CHICAGO, Ill., February 3, 2010 – The National Marine Manufacturers Association (NMMA), the recreational boating industry’s largest trade group, has called on President Obama to clarify his remarks in Nashua, New Hampshire yesterday which associated purchasing a boat with irresponsible spending. The President made this off-the-cuff remark at a town hall event announcing his new Small Business Lending Initiative. The President has already apologized to Las Vegas for similar comments he made in the same speech.
“The recreational boating industry is one of the last remaining American manufacturing businesses and net exporters, contributing nearly $30 billion in new sales and services to our nation’s economy each year, said NMMA president Thom Dammrich. “We don’t believe the President meant any harm by his comment, but we encourage the President to join us in celebrating the U.S. recreational boating industry and to stay focused on creating conditions for a strong business environment, including his own remarks.”
NMMA today sent a letter to the President encouraging him to visit a boat manufacturing plant and describing the U.S. boating industry. “Boats are made by middle-class Americans for middle-class Americans. By associating buying a boat with irresponsible spending, President Obama does a disservice to the very middle-class boat manufacturing communities across the U.S., such as Elkhart, Ind. We ask that he instead encourage Americans to spend responsibly and enact effective policies to get banks lending again so the American middle-class can get back on its feet,” said Dammrich.
The U.S. recreational boating industry creates more than 200,000 jobs in the United States, and has a total annual economic impact of $100 billion, including nearly $30 billion in new sales and services each year. Boating is a middle-class activity where 75 percent of boaters have an annual household income of less than $100,000, and 95 percent of boats are under 26 feet in length.
Recreational boating has been impacted by the distressed American economy, notably waning consumer confidence, tightened credit and banks’ unwillingness to support floorplan lending and the housing market crash. New powerboat sales decreased an estimated 28 percent in 2009 and 24 percent in 2008, leading to tremendous job loss and a decrease in boat manufacturing activity across the U.S.
NMMA’s letter to President Obama can be found here, or you can read the full letter below.
February 3, 2010
The White House
Washington, D.C. 20003
Dear Mr. President:
During your town hall event in Nashua, New Hampshire yesterday announcing your new, much-needed
Small Business Lending Initiative, you made a remark which unfortunately associated buying a
recreational boat with irresponsible spending. While we agree with you that consumers should always
make responsible buying decisions before making any significant purchase or investment, we take issue
with your characterization of boating as an extraneous or irresponsible purchase. As with your remarks
about Las Vegas, we hope you will take the opportunity to recognize that boating is a fun, family activity
that supports hundreds of thousands of American manufacturing and service jobs.
Indeed, the recreational boating industry is one of the last remaining American manufacturing
businesses and net exporters, with annual sales of nearly $30 billion and a total economic impact of
$100 billion. Boats are made by middle-class American workers for middle-class American consumers.
Our industry creates jobs for well over 200,000 Americans—workers in factories in Elkhart, Indiana;
Marion, South Carolina; Neodesha, Kansas; Fort Meyers, Florida and in hundreds of communities across
the United States. These are the very small businesses that your Administration is working to help.
By associating buying a boat with irresponsible spending, you send a very negative and unfortunate
signal to boatbuilding workers, marine dealers, marina owners, marine suppliers and the thousands of
marine industry employees in the United States.
We cannot overemphasize how important it is to fuel American middle class recovery and growth with
confidence and through responsible spending, rather than calling out an industry that is trying to work
alongside your Administration to support job growth and U.S. manufacturing. We sincerely hope you will
clarify your remarks and join us in celebrating a great American industry.
As you know, recreational boating has been severely impacted by the economic downturn. Low
consumer confidence, general economic uncertainty, and an unmitigated contraction of conventional
commercial lending has brought boatbuilding production to a near standstill and reduced overall
industry sales by nearly 30 percent. We estimate that more than 135,000 jobs in our industry have been
lost, but we are optimistic that economic growth will return and employees will be re-hired if the
Administration keeps focused on promoting a positive business environment.
In particular, we applaud your renewed focus on small business lending, which has greatly exacerbated
the impact of the downturn in our industry. While we are encouraged by your new Small Business
Lending Initiative and support your efforts to increase access to capital, we hope that you will begin to
pay particular attention to continued credit illiquidity in wholesale, or floorplan, financing. When a
retailer cannot access capital to purchase new inventory from manufacturers, those manufacturers are
forced to stop production, causing further painful labor reductions. Floorplan credit availability is key to
any meaningful economic recovery for these industries.
NMMA has worked with your Administration, including the Small Business Administration (SBA), the
Treasury Department and the Federal Reserve Board, as well as the Congress in trying to find solutions
to this ongoing problem. Your Small Business Lending Initiative should include specific efforts and
incentives to encourage community banks and other lenders to provide floorplan financing to marine
dealers at reasonable terms.
Additionally, in July of 2009, SBA launched the Dealer Floorplan Pilot Initiative (DFP), which is specifically
designed to address floorplan financing. This Initiative established a pilot 7(a) loan guaranty program
dedicated for lines of credit that provide floor plan financing and allows auto, boat, RV, trailer and
similar product dealers to acquire inventory. The SBA Floorplan Pilot Initiative has the potential to assist
a wide array of product dealers in establishing critical lines of credit with SBA approved banks to replace
lines that have either become unaffordable or have disappeared. However, after months of operation,
this program has received scant participation by national, regional, or community banks. We have
encouraged SBA to make specific changes to this program and to extend it to 3-5 years to encourage
more bank participation, and we hope these changes will be made soon.
Thank you for your continued efforts to improve the lending environment for businesses throughout the
United States. We stand ready to assist you in efforts to improve the business environment, and we
welcome you or members of you Administration to tour an American boatbuilding factory to see the
quality of jobs our industry provides to Americans across the country. We are happy to help coordinate
such a visit at any time.
Thomas J. Dammrich
About the National Marine Manufacturers Association (NMMA): NMMA is the leading association representing the recreational boating industry in North America. NMMA member companies produce more than 80 percent of the boats, engines, trailers, accessories and gear used by boaters and anglers throughout the U.S. and Canada. The association is dedicated to industry growth through programs in public policy advocacy, market statistics and research, product quality assurance and promotion of the boating lifestyle. For more information, visit www.nmma.org.