With factory incentives, it’s a buyer’s market
Posted on 26 March 2009
Written by Melanie Winters
Engine manufacturers are offering some of the most aggressive, comprehensive retail promotions in recent memory.
They hope to sway buyers who may be on the fence about making big purchases in today’s economic climate.
Manufacturers are each taking a different approach — from extended warranties to cash rebates to low financing options. But regardless of the specifics, each program has the same goal. “By offering a strong incentive at the [boat] shows, we can capture buyers in the ‘shopping mode’ and convince them to buy now,” says Chris Berg, director of marketing for BRP, which makes Evinrude outboards.
The fact that the National Marine Manufacturers Association is relaxing its boat show policy and allowing exhibitors to include up to 50 percent of older model product in their displays is a clear sign there’s a lot of excess inventory on the market, says Michael Rickey, national sales manager for Honda Marine.
“And the overall job situation is shaky, so a lot of people are nervous about making big purchases,” says Rickey.
That’s not to say the market has dried up completely. “Despite the current economic conditions, there is still a segment of the population that will continue to go boating,” says Jim Morgenthaler, general manager of Tohatsu America Corp.
That’s where the promotions come in. Here’s a look at what the six major outboard manufacturers are offering to help buyers who might be on the fence:
As part of its Evinrude (www.evinrude.com) 100th anniversary sales event, BRP is offering a five-year warranty (three-year BRP factory warranty, plus an additional two-year BRP extended-service coverage) and low-interest financing for customers who buy any E-TEC outboard between Jan. 1 and April 15. The special financing applies to E-TECs packaged with boats or loose engines purchased for repowering.
In addition, customers who buy an eligible loose engine may select one of two other options: an I-Command digital gauge package with a retail value of $1,186, or a down payment rebate up to $300.
“We’ve designed our retail promotions to reduce the cost of ownership,” says Berg. “Consumers have always looked for added peace of mind in an outboard engine. They want to spend more time on the water and not worry about the maintenance of their engine. Our extended protection plans provide that peace of mind.”
Honda Marine (www.honda-marine.com) was offering repower financing rates as low as 4.99 percent for boat show season. The program, offered by Honda Financial Services, was available to boaters repowering with new, unregistered Honda outboards (2 hp to 225 hp) between Jan. 6 and March 2.
Buyers have the additional option of deferring payments for 90 days with zero interest for the first 60 days. Customers looking to finance complete boat, engine and trailer packages (including accessories) can do so at rates starting at 6.99 percent. Each purchase includes Honda’s standard “True 5” five-year, factory-backed, non-declining limited warranty.
Rickey says the financing deals provide more “pull-through” compared to the typical rates of 8 to 9 percent offered by most banks. “The idea is to get those Honda-powered boats out on the market and make it easier for people who want to buy them,” he says.
Mercury Marine (www.mercurymarine.com) is again offering its “5 & Drive” sales event. Consumers who purchase any qualifying Mercury outboard through April 15 from a participating Mercury dealer will receive an extended, limited, factory-backed, non-declining warranty for free. A buyer could save up to $2,420 on select models, according to the manufacturer.
“With the success of last year’s promotion, we elected to offer the same [program] for 2009, but have extended the length of the promotion,” says Randy Caruara, vice president of sales for Mercury.
The five-year warranty promotion applies to all 25- to 300-hp 4-strokes, including Verado and jetdrive outboards; all OptiMax engines, including Pro XS and jetdrive outboards; and all OptiMax jetdrive engines. The extra warranty extends to four years for all 150-hp 2-strokes, and three years for all 50- to 90-hp 2-strokes, including jetdrive outboards.
“We have a great deal of confidence in the durability of our 4-stroke OptiMax and Verado products,” says Caruara. “This offers the consumer peace of mind for five full years.”
Suzuki Marine (www.suzukimarine.com) launched its “Gimme 6!” promotion. Consumers buying a new Suzuki 4-stroke from 40 hp to 300 hp between Jan. 1 and March 31 will get Suzuki’s standard three-year limited warranty, plus three years of Suzuki Extended Protection at no extra charge. Or they can choose a cash rebate of up to $500. The extended warranty applies to repower and new boat engine purchases (non-commercial use only).
“[Gimme 6! is] a limited-time offer, but one with long-term benefits,” says Larry Vandiver, Suzuki marketing director. “It gives our customers confidence, provides extra value, plus it represents a sizeable savings. The three-year Suzuki Extended Protection Plan on a 300-horse outboard is worth over $1,500.”
Tohatsu America Corp. (www.tohatsu.com) is offering a five-year, factory-backed warranty on its 25- to 115-hp outboards. The company also announced a new two-year warranty on its Hi-Lex HC49 series control cables that are distributed exclusively through Tohatsu America Corp.
“These incentives were established in an effort to increase sales, keep up with the current competitive trends and to offer an incentive to consumers,” says Morgenthaler, who is convinced the downturn is cyclical and the economy will improve in the near future. “The positives are the incentive and warranty programs … and an overall focus on providing good customer service. …
“From a consumer standpoint, this is a great time to get into a new boat because there are some great deals available and extra incentives, such as extended warranties being offered,” Morgenthaler adds.
Yamaha (www.yamaha-motor.com) is launching two retail promotions. The first, Repower Now, offers two consumer options. The first is a credit that can be used toward Yamaha rigging components and/or dealer installation services available at the authorized dealership that sold the engine. The second option is Zero Zero financing. On approved credit, customers will be eligible for no finance charges and no payments until Jan. 1, 2010, when purchasing select outboards for repower from authorized dealers.
The second retail promotion, Two Ways to Save, offers either a 36-month Yamaha Extended Service contract or a consumer credit toward the purchase of goods and/or services at the dealership that sold the engine. Both promotions run Jan. 1 to March 31.
“These promotions are the most comprehensive we have ever offered, and they provide more options for the consumer than ever before,” says Dale Barnes, marketing division manager for Yamaha Marine Group.
He says both promotions apply to a longer list of eligible outboards — from 2.5 hp to 350 hp. He says Repower Now is unique because it offers no interest and no payments for 12 months. “Yamaha has never before offered a program like it,” he says.
See related articles:
Your route to repowering
Will hybrid propulsion gain traction in the U.S.?
Yanmar gets into the sterndrive game
These articles originally appeared in the April 2009 issue.