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A once-sunk industry floats again

The boat business sank during the recession, but it is starting to float again as new boat sales eclipse sales of more cost-conscious, pre-owned ones.

"I think the boating industry is seeing the light at the end of the tunnel," said Ryan Kloppe, a national marine sales manager at market researcher Statistical Surveys.

Gerald Marineau | The Wasington Post | Getty Images

But the industry is not out of the hole just yet. In 2005, the year Fountain Powerboats CEO John Walker refers to as "the golden days," there were 404,000 new boat registrations, according to Statistical Surveys. By 2010, registrations dropped to 184,766. Since that low, the registrations climbed each year, reaching 205,000 in 2013. Registrations are used as a proxy number for sales since all new boats must be legally registered.

"The new reality is this: there is kind of a little bit of a rebound in the marine industry, if you do year-by- year comparisons," said Kloppe. That said, there's plenty of room for improvement in order to return to pre-recession levels.

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One bright spot has been ski boats and pontoon boats, which have each seen a 12 percent gain in year-long registrations from the first fiscal quarter of 2013 to the first fiscal quarter of 2014. Those boats made up 16 percent of the latest new registration data for the entire industry.

The types of boats hit hardest by the recession were smaller stern/inboard fiberglass boats, which are mostly used for leisurely cruising; sailboats; and houseboats, all of which continued to decline in sales as of the first fiscal quarter in 2014.

"I will say that almost all forms of these boats that we are selling today are what we would call a 'dayboat.' They are something that you can go out for the day on the water and do multiple things on—there's a lot of versatility to those boats, and for those that are looking for recreational pursuits, like wakesurfing, they'll want to get behind a skiboat or some other towboat," Thom Dammrich, president of the National Marine Manufacturers Association said.

"I'm sure there is some truth to the affordability, but mainly with those boats, they're very versatile. You can pull, you can ski behind the pontoons, you can just pontoon around with your family," said Kloppe of dayboats' appeal.

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Matt Santomenna, who owns Race City Marine in Mooresville, N.C., was able to start and grow his company during the midst of the recession, helped by his focus on towboats.

"When I started in 2008 it was absolutely crashing at bottom. Dealers were going out of business and customers who had purchased their boats had no one to maintain them. That's how I got my foot in the door, I helped repair them when the customers had no one to turn to," Santomenna said.

Matt and Lynette Santomenna, the husband and wife team behind Race City Marine in Mooresville, N.C.
Kyle Dillard | Race City Marine.
Matt and Lynette Santomenna, the husband and wife team behind Race City Marine in Mooresville, N.C.

From there he went on to do more repairs, scored a deal to do warranty work for Nautique, and then finally became a full-fledged dealer for Nautique towboats, a category that includes the wakeboard boats and ski boats that are selling so well.

"From our perspective, the towboat industry is very strong. It's one of the strongest segments right now in the industry," he said. "We've continually grown each year. I expect 10 percent growth from last year, and we're expecting 10 percent growth for next year."

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While ski, pontoon and tow boats continue to grow within the recovering industry, optimism reigns among its constituents.

"In another couple years, as the housing market heals, new boat sales will respond to that," said Dammrich. "When we see that, you'll see the boating industry fully recover. We tend to lead on the way down and follow on the way up."

"I think we're going to continue to see new boat sales growing here for the next couple of years," he said.

-- By Bo McMillan, Special to CBNC.com