Happy New Year everyone. Let’s make one wish for a cure to the biggest problem in front of us this year: credit, or actually the lack of it.
Senator Dodd and friends bailed out the banking industry with some impressive checks, but they forgot to attach any strings to them. So the banks said “thank you” and promptly purchased their competitors. Meanwhile, the dealers, with inventories that are not moving, are now receiving letters from those same bankers and floorplan institutions, discussing the higher rates they must now pay for their inventory and how they must now look for other financing sources. Seems the bailed-out banks are now casting the dealers away for other investments.
Without wholesale dealer financing, most dealers see a very bleak future. The manufacturers need to recognize this chain of events before it reaches its conclusion. If a dealer can’t finance his own purchases, there won’t be an inventory to sell from. No sales, and there is little chance that dealers are going to order anything, so it might be very important for manufacturers to consider how they might support their dealer network with inventory financing.
Key Bank and Textron have both announced exiting the industry, leaving GE as the largest player in that field. Let’s hope someone steps up to support the dealers and get credit back into the sales game. Without available credit — retail and wholesale — the recreational marine industry is facing the most difficult years ahead.
Grant W. Westerson
Connecticut Marine Trades Association Inc.