Minnesota’s watercraft economy is big business and continues to grow


In the United States, the 4th of July weekend is one of the busiest sailing weekends of the year, and this weekend will be no different, especially in Minnesota.

Hundreds, if not thousands, of boat, pontoon, canoe and kayak owners will float around Minnesota’s many lakes for fun in the sun.

The money these water-lovers spend each year on their watercraft ranks among the highest in the country, making the manufacture and sale of watercraft a key part of the state’s economy. For manufacturers and dealers knowing that Minnesotans have access to thousands of lakes and the Mississippi River, St. Croix River and Minnesota River are the state’s primary sales territory.

“Minnesota has such a deep history around recreational activities on the water,” said Grant Wildgrube, global product strategy manager at St. Peter-based Alumacraft, an aluminum boat manufacturer. “Fishing, hunting, water sports, as well as the calm that being on the lake can bring, are part of life for so many Minnesotans. There is an ingrained affinity for our water resources. and the great diversity across the state that exists in many families.”

In 2020, Minnesota ranked fifth in the nation in total marine spending, said Jennifer Thompson, senior vice president of boat and sports shows at the National Marine Manufacturers Association. Minnesota consumers spent $1.1 billion on powerboats and trailers for marine engines and accessories that year, a 14% increase in spending from 2019, said Thompson, also a Minnesota resident. .

“It really is a significant economic boon to the state,” Thompson said. “That’s really not the case for other states. It’s a big deal here.”

Marine industries supported by the outdoor lifestyle

Lake life in most corners of the state has historically contributed to Minnesota’s economy, according to county historical societies and the Land-O-Lakes Classic Boat Club. In 1889 Royal Moore started Moore Boatworks, later Minnetonka Boatworks, in Wayzata. The company’s mahogany-hulled boats could be seen for years on Lake Minnetonka.

And while Minnesota can’t take credit for inventing boats or fishing motors, companies in the state have been inventing improvements or new types for years, including the pontoon. It was the brainchild of Ambrose Weeres of Richmond, who was named “Mr. Pontoon” by the state legislature in 1991.

Ralph Samuelson, 100 years ago last month, invented water skiing on Lake Pepin. This led to several water ski manufacturing operations as the sport took off, including Nor-Craft Marine Division of Northwest Plastic in St. Paul and White Bear Water Ski Company.

Dave Saucier, a world-class water skier, made the first fiberglass water ski. The company he created became one of the biggest players in the industry in the early 1970s before the oil crisis and as a result skyrocketing resin costs drove it out of business.

And then there was Larson Boat Works and later Crestliner, which started in the 1920s in Little Falls and later became part of the late Irwin Jacobs’ industry consolidation into Genmar Holdings. This consolidation, in turn, was sold to others.

The economic impact of the Minnesota boating industry – between manufacturing and services – is always significant. In 2018, it was $3.1 billion, supporting 10,936 jobs and 690 maritime businesses, according to the maritime association. In Minneapolis specifically, the industry’s economic impact was $1.8 billion, supporting 308 businesses and sustaining 5,911 jobs.

“It’s one of the things that makes Minnesota unique,” Thompson said. “We are home to several American boat manufacturers headquartered here, and that supports thousands of jobs in our state.”

Boat businesses continue to thrive

Local brands continue to grow, including Wenonah Canoe in Winona; Alumacraft, which is owned by the Canadian company BRP; and pontoon maker Premier Marine in Wyoming, Minn., which was acquired last year by Elk River-based Envision Co..

Wenonah Canoe has about 70 people on its payroll, Alumacraft employs about 230 workers at its St. Peter site and is actively recruiting to fill 45 other positions, and at the time of the transaction, Premier Marine had more than 200 employees.

The U.S. boating industry has seen significant growth during the pandemic as people see the benefits of social distancing on the water, Thompson said. And with normal travel plans disrupted, people used stimulus checks or extra spending to splurge on personal watercraft, said Bill Kueper, vice president of Wenonah.

“The pandemic has caused a lot of people to paddle,” he said.

Demand for their products has forced state manufacturers to increase production, forcing some to the brink of capacity.

For Wenonah Canoe, the nation’s largest manufacturer of composite canoes and kayaks, demand was so high in 2020 and 2021 that the company emptied its inventory and had to suspend research and development plans while putting all its resources into production, which included transferring clerical workers into roles in factories, said Kueper, who was among the clerical workers who serviced production needs.

Alumacraft is expanding manufacturing capabilities to meet consumer demand, Wildgrube said, and Premier Marine is investing in a 150,000 square foot plant in Big Lake that will open by the end of the summer, Matt Homan said, general manager of the company.

Major Minnesota-based vehicle manufacturers that have added marine segments over the years are also seeing increased sales.

Minnesota Companies New to Industry Consolidators

Medina-based Polaris Inc. reported revenue of $211.5 million for its marine segment for the first quarter of 2022, an increase of 6% over 2021. Polaris acquired the company Boat Holdings based in Elkhart, Indiana, in 2018 for $805 million, acquiring personal watercraft with it. Bennington, Godfrey and Hurricane brands.

Eden Prairie-based Winnebago generated $126.5 million in revenue in its most recent quarter, a 637% increase from the same quarter in 2021, boosted by the company’s $255 million acquisition of dollars from the pontoon boat Barletta based in Bristol, India, last July. The company sold 1,655 boats for the last quarter. For the same three-month period in 2021, Winnebago’s marine segment earned $17.1 million from 83 boat sales.

Sales are starting to slow amid inflation after extraordinary growth over the past two years, but are still above pre-pandemic levels, Thompson said. In addition to meeting demand, boat and watercraft manufacturers are also facing setbacks in their supply chains.

Cold weather events in 2021 knocked out dozens of refineries in Texas, affecting liquid and solid resin material needs for Wenonah Canoe, which has more than 100 unique supply chains, Kueper said.

“We had to pivot and qualify alternative suppliers and ration ourselves,” he said.

Winnebago reported backlog for its marine segment was $245.4 million and remains at high levels “as low dealer inventories persist.”

It’s a common trend among manufacturers across the country, Thompson said, but companies are starting to see improvements in their supply chains, which has helped fill orders that are still in high demand.

“While there are certainly real economic challenges facing us all in many sectors, from rising interest rates to high inflation, we are really excited about the future of Premier Marine,” said Homan.

New Interest Offers Potential Opportunity

Interest in boating, nationally, is higher than before COVID, but well below a peak in 2020 and 2021, according to NMMA. In 2021, the number of first-time boat buyers topped 415,000, a 15-year high not seen since before the Great Recession, Thompson said.

That trend is evident in Minnesota, which ranked second in the United States for boat registrations in 2020 with 819,377, up 7% from 2019, Thompson said.

“During the pandemic, we’ve only seen that love for the outdoors grow,” Homan said. “Consumers just aren’t willing to sacrifice important time with their family, and boating is one of the best ways to be together.”

Many people in Minnesota own more than one boat or watercraft. According to the state Department of Natural Resources, in 2020 there were 591,546 adults in Minnesota with some type of licensed watercraft, motorized or non-motorized.

“Minnesota people love getting out on the water,” Thompson said. “It’s something we do and it’s become a massive industry here because of it.”


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