Recreational Boats Industry Profile
Definition of the Industry
The boat building industry comprises establishments primarily engaged in the manufacturing of boats. Boats are defined as watercraft suitable or intended for personal or recreational use.
The North American Industry Classification System (NAICS) code for this industry is 336612 — Boat Building and includes the following products and activities:
- Boats, manufacturing;
- Canoes and kayaks, manufacturing;
- Fibreglass boats, building;
- Fishing boats, building;
- Houseboats, building;
- Hydrofoil vessels (recreational type), manufacturing; and,
- Yachts, building (not done in shipyards).
|Economic Indicators||2004||2005||2006||2007||2008||% Change
|Source: Statistics Canada, Trade Data Online.
CAARG: Coompound Average Annual Growth Rate
Apparent Domestic Market = Shipments plus Imports minus Exports
Manufacturing Intensity Ratio (MIR) = Gross Domestic Product (GDP) divided by Shipments
Import Penetration = Imports divided by ADM
Export Orientation = Exports divided by Shipments
Domestic Market Share = Shipments minus Exports divided by ADM
|Apparent Domestic Market||571.6||617,0||900.5||970.2||842.1||-13.2%||10.2%|
|Gross Domestic Product||330.8||260.2||253.1||311.8||n.a.||n.a.||-2.0%|
|Manufacturing Intensity Ratio||48.0%||42.6%||33.5%||44.8%||n.a.||n.a.||-2.3%|
|Domestic Market Share||12.3%||1.3%||17.2%||10.0%||0.2%||n.a.||-64.8%|
Shipments and GDP fluctuated between 2004 and 2008, albeit in opposite directions. Shipments declined by 17.1 percent in 2008, from $696.2 million to $577.1 million. GDP rose from $253.1 million in 2006 to $311.8 million in 2007.
The trade deficit reached $265 million in 2008. The import penetration and export orientation figures reveal a mismatch between consumer preferences and domestic production, as nearly all of the apparent domestic market consisted of imports. Exports fell by 4.0 percent, from $599.3 million in 2007 to $575.5 million in 2008. Imports also fell by 3.8 percent to $840.5 million, and grew at an average annual rate of 13.8 percent between 2004 and 2008.
Because it produces what are generally considered luxury goods, the recreational boats industry may suffer from the consequences of lower disposable incomes and consumer confidence resulting from the current economic recession in Canada and its traditional export markets. Previous growth forecasts of between 4 to 5 percent per year now seem overly optimistic, given this expected slowdown in demand.
The Canadian dollar's recent depreciation may return U.S. demand to Canada. Exports plummeted and imports soared during the years that the Canadian dollar rose to par with that of the U.S. Firms responded to the Canadian currency appreciation by cutting prices (along with gross margins) and outsourcing their operations to the U.S. The domestic market, and the recreational boats industry's response, will determine whether the lower Canadian dollar can reverse the trade balance and contribute to output growth.
The recreational boats industry is regulated by the Canada Shipping Act (CSA) and the Canadian Environmental Protection Act (CEPA). The CSA establishes safety standards, while the CEPA administers guidelines for fuel emissions and the protection of marine habitats. Amendments to these regulations could alter the costs of doing business for manufacturers.
- Atlantic Marine Trades Association
- BC Marine Trades Association
- Mid-Canada Marine Dealers Association
- National Marine Manufacturers Association Canada
- Ontario Marine Operators Association
Boating Safety Promotion
Promotion of Sport
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