Interview with Ed Lofgren: Chairman of the Marine Retailers Association of America

The following is an excerpt from an interview with Ed Lofgren, chairman of the Marine Retailers Association of America. The interview may be seen in its entirety in the May 2009 issue of Soundings Trade Only.

Q. As the new chairman of MRAA, what are your goals for the association?

A. Certainly survival of this industry has got to be the paramount goal for the MRAA. The dealer body in this country is hard pressed by the financial hard times and particularly the lack of financing – retail and wholesale. If we are to survive as an industry and go forward, those problems have got to be remedied fairly quickly.

That’s probably the No. 1 goal, to have the MRAA play a real role in trying to affect some good, solid financing for the industry.

Q. GE recently announced interest rate hikes and other changes to its contracts with dealers. How will this affect the industry and what type of fallout do you expect to see?

A. I think it will impact the industry very significantly. It’s already launched a fall-out. Dealers are scrambling to see if they can find alternative sources of funding, which pretty much don’t exist. The lucky ones have relationships with their local piggy banks and in some instances those local piggy banks are better equipped to handle financing on a local basis for these people. But there’s not enough of those relationships and if GE does eventually exit from this business, I can see a big fall out. I can see anywhere between a 25 and 50 percent fall out for the dealerships in this country if GE should pull out and there’s no alternative sources of financing available.

We’ve even appealed to the government on various levels. MRAA has a letter going out to every congressman in the Senate and the House and basically asking them to pay attention to our industry. It’s a multi-billion dollar industry across this country and should we have widespread chaos and people exiting from the industry, it’ll devastate in terms of taxes, jobs, manufacturers, dealers will go out.

Q. At least one manufacturer has announced they are moving back the 2010 model year to September to allow dealers to sell their older models. Is this a good move and will it help clear out older inventory?

A. We’ve been preaching for years that we should have some kind of a fall start up instead of starting to produce inventory early in the year. Anything that pushes us back to September or even a little bit later for the start of the model year would certainly help. Absolutely. I think it’s a good move on the part of manufacturers to affect that right away if they can.

Q. Boat shows seem to be having mixed results this year, with many saying attendance is down, but the serious buyers are coming out. Are boat shows still lucrative and necessary for dealers? Do there need to be any changes to the formats of these shows?

A. Boat shows are absolutely necessary for a forum to exhibit and to sell, absolutely. You have to have good, well-organized, well-promoted boat shows. They’re not a thing of the past, as some dealers and manufacturers have seemed to indicate. They are very much a viable part of our industry and will continue to be.

Q. What do you think the dealer side of the industry will look like when we come out of the recession?

A. No question in my mind that it’s going to be somewhat reduced. The big question that remains is by what percentile. If you want me to make a guess, my guess would be we could have a significant outfall of about 25 percent. But, that’s only if we’re able to solve this financing issue. That’s the burning issue. If we’re able to solve that financing question, then I think we’ll get away with as little as a 25 percent fallout.

If we have good survival among dealerships I think you’ll see that the dealerships that remain are stronger as a result too. All of these efforts, like scrutinizing the expense side of the ledger, are going to help these dealerships to become stronger.

There’s a need for dealers to band together under the MRAA flag – there’s strength in numbers. We can help you survive.

Source: Trade Only Today

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