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WakeWorld Discussion Board » >> Boats, Accessories & Tow Vehicles Archive » Archive through March 18, 2009 » Layoffs at Mastercraft « Previous Next »
By Jeff (fogey) on Saturday, February 28, 2009 - 9:43 pm:    Edit Post Delete Post
East Tennessee's largest newspaper, the Knoxville News-Sentinel, had a story today about Mastercraft. The company laid off 110 workers "effective immediately," with no severance. Both production and admin jobs were cut. With this layoff and previous ones (for example, another 56 were let go last month), the work force will be down to 200, compared to 570 "last year."

John Dorton attributed the problem to a collapse in wholesale credit for dealer floorplan financing. He said there used to be five companies offering this service nationally, but now it's down to one. He said this "atomic bomb" hurts because about 80% of boat sales are to dealers who rely on this financing.

Dorton said the 2008 model was "a record year" for Mastercraft. They were building 20 boats a day (from the article, it appears he was talking about the period of 7/1/2007 through 6/30/2008). Dorton said production will be at five boats a day "starting Monday," which he says "still makes [Mastercraft] one of the industry's highest volume manufacturers; it's just terrible out there." Dorton said that MC "is hoping that warmer weather this spring will spur boat sales."

Note: The article didn't say anything about what another person in the industry told me -- the remaining employees are having their salaries cut 20% to 40%, "take it or leave it."

By Kevin Hoye (wakebrdr38) on Sunday, March 01, 2009 - 6:04 am:    Edit Post Delete Post
im not hating when i say this, but does it say much when you are producing 20 boats a day and they arent selling 20 boats a day? Doesnt really sound like bragging rights when those boats are now sitting in lots still in shrink wrap not being sold. (and yes I have seen lot fulls of MC's in shrink wrap that havent was a sad sight)
By A-dub (behindtheboat) on Sunday, March 01, 2009 - 8:14 am:    Edit Post Delete Post
Jacked up MSRP coming back to bite
By David "Pootie Tang" (colombiansurfer) on Sunday, March 01, 2009 - 8:36 am:    Edit Post Delete Post
One thing they never mention in all of these stories is the cost of supplies, materials and products. Are they going up in cost also making the boat makers raise there prices? Did fiberglass cost more this year than last year? What about the carpet? If they have stayed the same as last year, then yes, question why the price jack up. What are the presidents and CEO's of these company's doing to help there employees and plant? Are they taking pay cuts as well? I own my business and my prices on my products and services is 75-90% cheaper than any of my competitors. I rather make a little profit on one sale and be able to make 100 sales than make a large profit on one sale and never have another sale for months to come. I have so much work right now, they we cannot keep up and hiring every week new people. With all that said, the boat makers and dealers could do the same. I have personally seen what a dealer paid for a new boat from the factory and the dealer mark up is crazy! So that 25K payback everyone thinks is a good deal is crap. They are NOT losing money on that deal.
By AMO (amo) on Sunday, March 01, 2009 - 8:53 am:    Edit Post Delete Post
What are they paying for boats David? I know the folks where I live personally told me they try and make 15% pure profit on every sale. That seems low based on what you are saying. I would love to see what these boats really cost to build, before the boat company adds their markup to the dealer, and the dealer adds their ridiculous markup to you.
By Billy (woreout) on Sunday, March 01, 2009 - 8:57 am:    Edit Post Delete Post
All mfgs are hurting. Malibu has two plants for sale and has rumored Chapter 11. Times are tough for all, I hope everyone can make it for sure.
By Brett Yates (polarbill) on Sunday, March 01, 2009 - 9:00 am:    Edit Post Delete Post
Most would probably make between 20% and 30% gross profit on peak season current model boats. That is gross profit though. Start subtracting the additional costs and i would guess the dealers make 5-10% per boat. In th eeconomy right now though I would say they aren't doing much more than breaking even. When you add in all the flooring costs for past models sitting for a year plus, that is going to take some serious profit out of the equation.

(Message edited by polarbill on March 01, 2009)

By Kevin R Baugh (krbaugh) on Sunday, March 01, 2009 - 9:07 am:    Edit Post Delete Post
MAsterCraft and other boat companies are doing what they have to to survive.
MasterCraft is Also on a 2 week on and 2 week off schedule until things pick back up

Fiberglass Costs more correctly resin costs had huge increases along with Oil. Once they are up to the level they where when oil was 140 dollars a barrel they don't come back down near as fast. They may have dropped a bit this year. It works just like gas prices they shoot up very fast with every increase in the price of oil but they come down very slowly

David That 25K payback is not done by MasterCraft or the dealer. This is like an insurance policy sold by a 3rd party they are betting you will not be able to remember to do all the things that you have to do exactly when you have to do them.

What percent of Markup do you think are on boats?

By Jeff (fogey) on Sunday, March 01, 2009 - 9:29 am:    Edit Post Delete Post
"All mfgs are hurting . . . I hope everyone can make it."

My sentiments exactly. Including, I might add, the source of engines in all wakeboard boats, GM.

By AMO (amo) on Sunday, March 01, 2009 - 9:45 am:    Edit Post Delete Post
I figure, here in AZ for instance, at the end of '07 the MC dealership tried to sell me a new '08 X-star for $105,000!!! No joke. I laughed and walked out. If I would have bought the boat for that price I figure they would have marked that boat up between 80 and 100%. I'm guessing of course, but IMO that would be damn near doubling the price of what it costs to build the boat. Who knows, they might build them for cheaper than that, I would think they do. Problem was at the time people down here had more money than sense. I watched people walk in a boat or car dealership, no wheeling, no dealing, just "how much is it loaded? Ok, I'll pay that". They would whip out the check book and not think twice. Funny thing is, I still ended up paying $91,000 for my Star at a different dealership and I still think they made out really well, and that's fine. Ultimately, products are only worth what a market can and will bear for them. Basic law of supply and demand. Problem is, now the cost to build these great machines are still high and people can't afford, or won't pay what they cost, let alone the markups that go along with them. Dealers have to be getting killed. At best, they have to be living off of their "fat-stores from the last 2-3 years of that high powered economy.

I mean seriously, I can't imagine an X-Star costing more than $50,000 to build. I would be shocked!

By w.h.o. (oakley84) on Sunday, March 01, 2009 - 9:51 am:    Edit Post Delete Post
I have to agree with wakebrdr38, can't flood the market with 2008 models and then say you had a record year. Sounds like poor planning.
By Kevin R Baugh (krbaugh) on Sunday, March 01, 2009 - 9:53 am:    Edit Post Delete Post
With absolute certainty i can say that NO dealer is marking up boats at anywhere near 80 to 100% that is laughable. However I would agree that 105K for a wake boat is NUTS!


Excellent points!

By AMO (amo) on Sunday, March 01, 2009 - 10:00 am:    Edit Post Delete Post
So Kevin, you're insinuating that X-star's may cost more than $50,000 to build from the ground up? Stock of course, no options.

If that is the case, then it is worth what i paid for it. In the true sense of the word "worth". It costs X to build, then markup to the dealer X amount (company profit), then dealer marksup to consumer X amount (dealer profit). Am I simplifying this too much? It doesn't seem like I am. But please, correct me if I am wrong.

By Ken Land (bulletlines) on Sunday, March 01, 2009 - 10:08 am:    Edit Post Delete Post
Most of the boat dealers purchase the boats at 30% off MSRP. I would agree with a dealer making at least 15% net profit (probably closer to 20%), as they have to pay interest on floor inventory, pay commissions to sales, and I'm sure there is a cost per square foot of floor space a boat fills.

Ken Land
Bullet Lines

By Kevin R Baugh (krbaugh) on Sunday, March 01, 2009 - 10:14 am:    Edit Post Delete Post
" may cost more than $50,000 to build from the ground up"
What I am saying is the dealer is not paying 50k for that Xstar MSRP is most like 30% or so over dealer cost.

It sounds like the first dealer gave you MSRP on the boat that is not 80 to 100% over dealer cost

Now what it cost to build it that might be open for debate.

By Kevin R Baugh (krbaugh) on Sunday, March 01, 2009 - 10:16 am:    Edit Post Delete Post
Right on the money Ken!
By Jack Hinkes (jackeh) on Sunday, March 01, 2009 - 10:23 am:    Edit Post Delete Post
i am hoping that all these companies can turn themselves around.

i wouldn't want to see anyone not have a 2010 or a 2015 boat.

i hope they are around a long time to come.

By Kevin R Baugh (krbaugh) on Sunday, March 01, 2009 - 10:28 am:    Edit Post Delete Post
Absolutely! All of the companies have helped push the industry in term of style, quality etc
By Brit Rider (brit_rider) on Sunday, March 01, 2009 - 10:30 am:    Edit Post Delete Post
Jess said: "My sentiments exactly. Including, I might add, the source of engines in all wakeboard boats, GM"

This is a really interesting topic, I just wrote a paper on it and the Brunswick company who build many sports boat brands and own Mercruiser. If anyone is interested in seeing how Brunswick is doing and handling the current market issues they are welcome to a copy - its 2,800 rather fact filled yet boring words... ;)

By AMO (amo) on Sunday, March 01, 2009 - 10:39 am:    Edit Post Delete Post
Agreed Kevin, I did not write that first paragraph correctly. I meant the 80-100% was from the manufacturing cost of the boat, not from the dealer cost of the boat. My bad on not making myself clearer.
By AMO (amo) on Sunday, March 01, 2009 - 10:44 am:    Edit Post Delete Post
I think some companies will be fine. They will just have to build on a per order basis until this economy starts getting better. What I hope doesn't happen, is a sacrafice in quality with the higher end boats.
By  matt c (curtisco24) on Sunday, March 01, 2009 - 11:47 am:    Edit Post Delete Post
malibu took an extended Christmas break but there is no rumored ch. 11 that I have heard of.
By all eyez on me (ponte_06_x2) on Sunday, March 01, 2009 - 11:53 am:    Edit Post Delete Post
just out source the boat building to mexico or china. thats next
By David "Pootie Tang" (colombiansurfer) on Sunday, March 01, 2009 - 2:04 pm:    Edit Post Delete Post
I can understand the prices of some material going up, but to the point of making a wake boat boat cost 80K plus??? I know the dealers have to make a profit but any dealer will tell you that a lot of there profit comes from repairs and shop work they do. A recent well known boat dealer went out of business in my area. When I stopped by there the mechanic was in the building getting a few things out before closing the doors and I asked him about why this happened. He showed me the cost of a boat they bought from the factory at a price of about 38 - 39K, there cost, but the retail was around 65-67K. Been a while ago since this, so I am going with low figures that I remember. The same boat that I thought about getting they gave me a price of around 60K out the door. Now this is just one dealer and I am not saying all the dealers are like that, but the fact is that there is a nice mark up on these toys.

Like All Eyez said, they might outsourced to Mexico or China next. The dealers and builders need to come together collectively and agree on a fair price and not bounce all over the place. I can call right now 3 different MC dealers and ask about a boat with the same options from all 3 dealers and get 3 different prices. then if I tell them one is cheaper than the other, they will tell me there is no way it can be that cheap then start arguing who is a better dealer. I hate it for the sport and the fact that middle class people cannot enjoy one of these boats unless they can pay cash or have perfect credit scores, but that is the way it is. We got ourselves into this mess along with the banks and it is up to us to get ourselves out of it. No matter how bad it gets, I will still support my dealer.

By Michael Padula (michaelspsp) on Sunday, March 01, 2009 - 3:24 pm:    Edit Post Delete Post
they can go to mexico or china but the fact is how many people can pay $80k for a boat right now when peoples investments are worth half of what they were last year.....things wont be better for at least a year if are very lucky. things are going to get much worse for everyone
By Aaron D (aarond0083) on Sunday, March 01, 2009 - 4:36 pm:    Edit Post Delete Post
David, if their cost on a boat was roughly 40K and they are selling it to you for 60K, I don't see anything wrong with that. After you factor in the trailer, tax, title, etc they are making 15-20% on the sale. These boat dealerships aren't cheap to run and these guys have to make money.
By David "Pootie Tang" (colombiansurfer) on Sunday, March 01, 2009 - 5:15 pm:    Edit Post Delete Post
Aaron, I understand they have to make a profit and I am not against that. But they can help themselves and take some of the hit in order to move a boat. If they do take some of the hit the customer will do more business with that dealer when it come time for repairs or to purchase another boat. anything will help to keep the industry afloat. Look at all the dealers going out of business out west. the ones hat bought a boat from them now have to drive farther in order to get repairs done or look for a local guy. Then you have to worry if he covers warranty work. I am lucky that my dealer is only 30 minutes away. But for some, there "new" dealer is about 3 to 4 hours away.
By chuck j (wiz) (wake_eater) on Sunday, March 01, 2009 - 6:19 pm:    Edit Post Delete Post
another thing to think about is the number of boats they sell per year. the boat dealers aren't like car dealers. they don't sell a couple thousand a year. a great year would probably be anything over 75. so therefore, they have to make a decent profit.

imo, we're gonna see these companies with wakeboats priced at & around 100k have to rethink their strategy. the whole "name recognition" game can only go so far.

By Michael Padula (michaelspsp) on Monday, March 02, 2009 - 6:35 am:    Edit Post Delete Post
like everything else. they need to drop prices
By John Gardner (roverjohn) on Monday, March 02, 2009 - 6:48 am:    Edit Post Delete Post
Or sell direct to consumer.
By MattG (pierce_bronkite) on Monday, March 02, 2009 - 7:04 am:    Edit Post Delete Post
As much as I don't like the overpricing of MC's I still hate hearing news about any manufacturer hurting.
By all eyez on me (ponte_06_x2) on Monday, March 02, 2009 - 7:11 am:    Edit Post Delete Post
or a company having to get rid of people.
By Michael Padula (michaelspsp) on Monday, March 02, 2009 - 7:45 am:    Edit Post Delete Post
the Dow is below 7000 right now. it is bad for everyone and every business.... it will be 2 years before we get out of this mess
By Larzon (xsmini) on Monday, March 02, 2009 - 8:25 am:    Edit Post Delete Post
Malibu hasn't owned their buildings since 2006. They sold them, with a 50 year lease option. The people who own the buildings and land are selling them
By nu bu (05mobiuslsv) on Monday, March 02, 2009 - 8:47 am:    Edit Post Delete Post
Woreout is just trying to stir the pot like he always does in threads where MC and Malibu are involved. How did Malibu get involved in a thread about MC anyways? Oh ya another stupid rumor was brought up.
By alt (alteczen) on Monday, March 02, 2009 - 9:01 am:    Edit Post Delete Post
I can't speak for all dealers but I don't know of any that make 50% on a boat... that's absurd. If they are lucky they are getting 15-20%. But factor in costs to sell that one boat that people don't think about(this doesn't even account for all overhead costs like building, employees, benefits, etc):
- prep time
- flooring costs
- insurance fees for flooring that boat
- sales commissions
- putting fuel in the first tank so the buyer can run it the day he gets it
- employee time to process the sale and paperwork, register titles, etc. Most sales occur over weeks. Most don't come in and say I'll take it like they are buying a t-shirt
- customer satisfaction costs. For example: Guy buys boat, yanks hard on a seat because he forgot how it's "supposed" to open and breaks something. Do you charge him to fix it if it's a small fix? In most cases (not speaking for all) I'd say if it's a quick easy fix the dealer will take care of you.

Larger multi line dealers can do really well. But I'd say most of your small dealers that carry, promote, and support the wakeboard industry aren't retiring anytime soon off their wakeboard boat line sales.

Regardless, it's not good to hear news like this during these times. But it's necessary evil for the mfg to stay alive. I feel for the people who got laid off... But if the company doesn't the whole ship goes down so to speak.

We (as wakeboard enthusaists and community supporters) are in this together. I hope all manufacturers make it out of the thick as competition is good. It keeps Malibu vs MasterCraft vs CC vs ... upping their products year after year.

By Mike (surfdad46) on Monday, March 02, 2009 - 11:04 am:    Edit Post Delete Post
The hard costs of "building a boat" are only a portion of the costs of doing business, what about the millions in advertising, costs of insurance, employee costs etc... It may only cost 40k to build a boat but you have to cover all your other costs as well.The millions in advertising are especially relevant to Mastercraft, they are a massive marketing company.
By Michael Padula (michaelspsp) on Tuesday, March 03, 2009 - 7:01 am:    Edit Post Delete Post
yes, and what about promoting the industry? sponsoring contests and riders????
By Mike (surfdad46) on Tuesday, March 03, 2009 - 11:00 am:    Edit Post Delete Post
Yea, I would be willing to bet the people that think that Mastercraft and the dealers are smoking them are employees not employers. There are so many costs associated with running a business. These are the same people who expect a new board rack for free because there's "just bent!!", who do you think eats that??
By David Williams (wakeworld) on Tuesday, March 03, 2009 - 2:34 pm:    Edit Post Delete Post


All mfgs are hurting. Malibu has two plants for sale and has rumored Chapter 11. Times are tough for all, I hope everyone can make it for sure.

A simple inquiry to Malibu produced this: "We have been leasing our buildings back since 2007. The sale of the property is completely unrelated to Malibu. We have a long-term contract to lease the buildings no matter who owns them. Neither of our plants are shutting down and we are nowhere near chapter 11. We are building boats."

The building issue has been set straight several times before on this discussion board, so twisting that to mean something it doesn't is not being super honest.

By Erik (kinger) on Tuesday, March 03, 2009 - 2:59 pm:    Edit Post Delete Post
Yea because I'm sure a company is going to come out and say no we are almost to Ch 11 and we are in deep trouble. I don't know what anyones' situation is but that doesn't really sets the record straight.
By Andy G. (ottog1979) on Tuesday, March 03, 2009 - 3:12 pm:    Edit Post Delete Post
Erik, Dave is pointing out that several have used the Malibu PLANTS sale to infer something about Malibu's financial condition. Fact is, Malibu is not selling the plants. They are for sale, but NOT by Malibu. To construe something about Malibu because the plants are for sale is illogic.
By David Williams (wakeworld) on Tuesday, March 03, 2009 - 3:42 pm:    Edit Post Delete Post
Erik, maybe you read it too fast. I don't see anywhere in my post where I say I have "set the record straight" about anything other than the building issue.
By Michael Padula (michaelspsp) on Tuesday, March 03, 2009 - 3:47 pm:    Edit Post Delete Post
Mastercraft PRINTERS is filing chapter 11 . wrong mastercraft. well depends how you look at it. 3 years ago mastercraft INTERIORS filed chapter 11...
By Mike (ponyh8r) on Wednesday, March 04, 2009 - 3:06 pm:    Edit Post Delete Post
I like when people say that Mastercraft is over priced. Plain and simple supply and demand. Mastercraft charged steeper prices because they could, people were paying it. The market will adjust itself (as it already has) and you won't see a demand for the boats, and prices will fall.

I guess my point is, that if anyone is to blame for the overpriced wakeboats, it is us the consumer. We were willing to pay WAY too much for these things.

By A-dub (behindtheboat) on Thursday, March 05, 2009 - 8:30 am:    Edit Post Delete Post
IMO, depends on how you look at the supply and demand. If that's all you care about, and increasing your business is of course what you want to do, it is a good move. When all that demand is in my mind the wrong customer, or someone who is only getting a boat because of it's prestige and that they supposedly hold their value well, treating it like an investment, then you should not rely on that demand to be around very long, as they will move on to the next shiny thing or hobby.

My point is, in the attraction of more customers, they began to lose their real customers with the price increases.

By John Gardner (roverjohn) on Thursday, March 05, 2009 - 9:27 am:    Edit Post Delete Post
And, when dealers have that attitude they should expect consumers to go hammer them when the opportunity exists as it does now. That's why some of the "go support your local dealer" posts don't hold water when the same people claim dealers should charge "whatever the market will bear" when times are good. Just saying. Support the dealers that supported you when they could have bent you over but didn't. Let the gold chain crowd wither.
By andrew taft (taft) on Thursday, March 05, 2009 - 9:40 am:    Edit Post Delete Post
It is obvious now that Mastercraft is going to have a fun time trying to determine a pricing strategy for the short term. With a huge fall in demand, their boats won't sell at traditional prices (to a degree that will maintain past bottom lines). It's hard to say whether they will be able to ride out the recession without changing their prices. While the layoffs could be a signal that they are trying to hold onto their pricing scheme, 2009 will only get worse. Only so many layoffs are possible before they will really need to look at their positioning in the industry.

When the recession is over and things begin to recover, it will be interesting to see what they do then. Currently they're priced as a premium product. If they become more competitively priced then try to raise the price in a couple of years, the reactions they will create will be entertaining to say the least.

By Mike (ponyh8r) on Thursday, March 05, 2009 - 12:29 pm:    Edit Post Delete Post
Mastercraft is certainly caught between a rock and a hard place. A big selling point for them is resale value. So, do you alienate this strategy by dumping the prices and tanking the MC used market or do you cut in other places (such as quality) and hope they retain value? I would not want to have to make that decision.
By John Gardner (roverjohn) on Thursday, March 05, 2009 - 12:50 pm:    Edit Post Delete Post
Maybe I'm the oddball but I can't imagine ANYONE buys a boat and considers the resale price. I buy a boat to go boating, I buy T-bills or whatever if I want a ROI. Boats are consumable and depreciating assets just like a car they are not an investment. No wonder pricing strategy took the path it took if the majority was looking for a ROI when they went shopping for a boat. Jeez.
By Mike (ponyh8r) on Thursday, March 05, 2009 - 1:35 pm:    Edit Post Delete Post

I agree with what you are saying, however, most people never intend to keep their boats for the term of the loan. So for me, it is not a ROI but rather a depreciation value I am concerned with. For instance, if I spend 50K on boat X and it has a relatively bad resale, say in 3 years it is worth 30K, a net loss of 20K right? Meanwhile boat Y is $70K but in three years is worth $55. Then the net loss is $15K. It is a difference in how much depreciation for me. I know I will never make money owning a boat, but I also know me....and I won't keep it long enough to matter.

By John Gardner (roverjohn) on Thursday, March 05, 2009 - 2:16 pm:    Edit Post Delete Post
Mike, Your method of calculating costs relies on your ability to foretell the future. If you truly could do that you would never need to borrow money to buy anything. Your example also doesn't make any sense because you have not calculated the interest expense incurred during the term of ownership. If you counted that in you'd see that the 20k loss is actually less than the 15k loss because you'd pay so much less interest and contribute much more to equity. There are anomalies that might change that like super low interest or subsidized interest or zero down loans but since you can't predict the future any better than me why would you risk it just to have a little more bling? Most people who use your strategy do so because they want what they want and need an excuse to make decisions that is not in their best interest. I'm glad it works for you but the reality is that it won't work for most.
By dj (dizzyj) on Thursday, March 05, 2009 - 2:17 pm:    Edit Post Delete Post
seriously, in trouble? does anyone think that mastercraft couldnt sell xstars for 40k and not pull a profit? or 20k? there isnt anything different in these boats vs runabouts. fibreglass, check, carpet, check, guages, check. seriously, ballast tanks and "r&d" cost and additional 50k?!?

now dealers who have a lot of 07/08 on their lot might be in trouble, but I bet the boat manufacturers are fine.

By np3 (ponder86) on Thursday, March 05, 2009 - 3:00 pm:    Edit Post Delete Post
^^^ Really? Sorry but that statement is ridiculous.
By Nick Tomsyck (sidekicknicholas) on Thursday, March 05, 2009 - 3:24 pm:    Edit Post Delete Post
20k is too low, but I bet MC could sell a xstar (note - I said MC, not through a dealer... like factory direct) at 45/50k and make a profit.... only thing is that profit would be so small they would have to sell an assload to stay in business and as good of a deal as 45k for an xstar sounds I doubt they would have people lining up to get them... because that is still a lot of moeny.
By AMO (amo) on Friday, March 06, 2009 - 8:11 pm:    Edit Post Delete Post
I don't see how they can avoid chapter 11.
By David Williams (wakeworld) on Friday, March 06, 2009 - 8:32 pm:    Edit Post Delete Post
Care to tell us how you made that analysis?
By gangstar (joe_crawley) on Friday, March 06, 2009 - 8:48 pm:    Edit Post Delete Post
this thread hurts my head. One guy that has been on here for over 5 years thinks they can make an X star for $20k and another guy thinks boat resale value is irrelevant... ugggh
By Mike (surfdad46) on Friday, March 06, 2009 - 10:26 pm:    Edit Post Delete Post
How are they going to pay for all the "pro riders" the pro tour and the millions on advertising at 20k or even 40k for an x-star.What about their employees and insurance and rent and power.
By andrew taft (taft) on Friday, March 06, 2009 - 10:58 pm:    Edit Post Delete Post
If there is going to be an answer to the rumor, it'll happen in the next couple of months. This economy won't find a bottom til the summer maybe.
By Michael Padula (michaelspsp) on Saturday, March 07, 2009 - 5:05 am:    Edit Post Delete Post
everyone is laying off. do you people watch the news? unemployment over 8% and no sign its going to go anywhere but higher. and that does not include people who have been out of work for over 1 year or 6 months, cant remember which they said last night. everyone is in trouble. every boat, board, accessory, car, house builder/manufacturer. and some of the posts on this sight are so stupid, they are not worth replying to
By Karl De Looff (boarditup) on Saturday, March 07, 2009 - 6:24 am:    Edit Post Delete Post
As one of the old guys on the board, I remember the '70s and early '80s recessions. Yes, it will get worse. MasterCraft (Penske) is shrewd. I am sure they will have enough capital to make their next bond payments (although restructured). MasterCraft is the most recognized name in the boating business. That name and brand recognition is priceless (well, almost). They will survive, but there will be carnage with some suppliers and employees.

The classic saw about lower prices only gets so far. The low price king - Gekko - went under and has been resurrected by Fineline (Centurion). Brunswick (Bayliner) has also stopped producing boats - slo a low price is not a guarantee of sales.

Face it - we have a very expensive sport. It is economically sensitive. It will take time to come back. It will not be the same as in the early 2000's - ever.

On a personal basis. If you have the cash to spend, now is a good time for our sport. It needs the cash infusion. Gas prices will be lower this summer than last. Figure between $2 and $2.50, unless something happens in the Middle East or Mexico.

The best thing to do right now is invest. Stock prices are very low and the recovery - when it happens, will double your money in 2-3 years. Personally, I am buying biotech.

By Billy (woreout) on Saturday, March 07, 2009 - 6:53 am:    Edit Post Delete Post
Karl is right. Everyone should go out and spend whatever you can afford on our sport. No matter if your buying a new floating key chain for 3 bucks, or a new boat it all helps our sport.
The best thing is, when I'm out in the boat with my family or friends I don't even think about the state of our economy. Getting out on the water is a true form of therapy and stress relief for me. There is nothing better than to be out in the boat with my kids and watching the smiles on their face. Its priceless.
Have a great weekend .

By michaelspsp (michaelspsp) on Saturday, March 07, 2009 - 7:19 am:    Edit Post Delete Post
Billy, i couldnt have said it better! thats it in a nutshell
By AMO (amo) on Saturday, March 07, 2009 - 7:42 am:    Edit Post Delete Post
David, I wish I could tell you. All I know is that they quit paying their athletes, and they may be pulling out of every other sponsorship this year except the PWT. I will not reveal a source, so please don't ask. This is just a market correction. Dorton and Penske got greedy and this is what happens. Remember boys, Chapter 11 is restructuring, Chapter 7 is full on liquidation close the doors bankruptcy. I think Penske is going to put it up for sale, unless they seriously restructure. They're too good of a name to go away forever, if they even goes away at all. I wish them the best, I want to be able to order replacement parts for my X-star when I need them.
By David Williams (wakeworld) on Saturday, March 07, 2009 - 7:42 am:    Edit Post Delete Post
I talked to John Dorton, the CEO of MasterCraft, yesterday and he tells me that there are no plans for MasterCraft to file bankruptcy and that the Pro Wakeboard Tour sponsorship will be unaffected by the recent slowdown in business.
By AMO (amo) on Saturday, March 07, 2009 - 7:53 am:    Edit Post Delete Post
No offense David, but of course that's what he's going to tell you. You're the media.
By AMO (amo) on Saturday, March 07, 2009 - 8:06 am:    Edit Post Delete Post
He's not going to tell his wife what's really going on, if my source is correct, and I understand that's a big if. We'll all just have to wait and see how it shakes down. I truly hope the source is wrong.

With all due respect to all the readers and subscribers on this site, I urge those of you to not be so naive as to think that any wake company is altruistic in their behaviors toward the consumer. We all love the sport and our emotions play a huge role in how we view products and businesses. These companies, in the end, are in business to make money, period. Roger Penske isn't a multi, multi millionaire because of his altruism.

By JT (shwiezz) on Saturday, March 07, 2009 - 8:38 am:    Edit Post Delete Post
You hit the nail on the head! it is all about the family and friends! Being on the water is therapy. Well said!
Dam winter.......

By gangstar (joe_crawley) on Saturday, March 07, 2009 - 9:23 am:    Edit Post Delete Post
By David Williams (wakeworld) on Saturday, March 07, 2009 - 9:27 am:    Edit Post Delete Post
Just seems to me that if you're going to sling mud at a company (deserved or undeserved) and tout your "insider knowledge," you should at least have the stones to attach your real identity to your post.

It's real easy to be wrong and damage a company's reputation when nobody knows who you are. But put your own name and reputation on the line and I'm betting that you wouldn't be as eager to post your "insider info."

By Jay (jaysus) on Saturday, March 07, 2009 - 9:34 am:    Edit Post Delete Post
^^^^ bout time, well said Dave ^^^^ the "insider info/industry souce" thing is getting old quick.
By AMO (amo) on Saturday, March 07, 2009 - 10:12 am:    Edit Post Delete Post
Read it carefully boys, I'm not slinging mud. I want MC to succeed. I am just creating conversation. This site is filled with all kinds of conversationalists. Trust me, I want my source to be wrong. I am simply reporting what I heard, just like you were reporting what you heard from Mr. Dorton. Unfortunately in this day and age I don't think any of us should put all our stock into what a CEO says. Know what I mean.

And gangstar, being on this planet 8 more years than you, I should know more.

David, I don't know you and you don't know me. What ever damage Mastercraft has done to their reputation they have done on their own. Don't be so arrogant to think this site and it's bloggers have the power to bring down a company like Mastercraft. I am reporting what I am told, kind of like you reporting Dorton saying that MC is solid. Who says you're right. What, just because you run this site? Give me a break man. I live in and deal with a media world far more complex than this. This is peanuts. I appreciate everyone's comments on this site, and because of this appreciation I know this is a forum where people discuss and debate without having to explain who they are on a daily basis. Just because I say something "controversial" that automatically means that I don't have stones because I won't put my "real" name to it. Get off the playground man. Are you going to tell me my mom wears combat boots next. Of course I post in anonymity, I'm not stupid. I have the "stones to tell you that a) you're naive to think that Dorton is telling the truth, and b) my source and myself may be wrong about this. I know I am asking you to take me and my source as a credible one, and that's a lot to ask. I can understand your reaction, but we're just talking here not actually shutting Mastercraft's doors. Actually knowing who I am isn't going to change your mind, and knowing my source is just going to get me in trouble to some degree. Do you have the "stones" to admit you may be wrong about what Mr. Dorton said?

By TK (swab791) on Saturday, March 07, 2009 - 10:30 am:    Edit Post Delete Post

I am gonna love when all the economic crap is behind us and the the RUMOR CONTROL FREAKS eat there words

" I have a friend of a friend who heard that Ferris is really sick and will need a kidney transplant" Reveal your source!!!
Or stop spreading rumors!!!

By Brit Rider (brit_rider) on Saturday, March 07, 2009 - 10:35 am:    Edit Post Delete Post
AMO, do you have many leather bound books? Your apartment smell like rich mahogany at all?
By David Williams (wakeworld) on Saturday, March 07, 2009 - 10:36 am:    Edit Post Delete Post
Nobody said I was right and nobody said you were wrong. That's not the point. Look up the word 'accountability.' Notice I included my name and my sources name with my statement so that those that read what I report can digest it accordingly. That's what reporting is. That's not what you're doing.

It doesn't look like I'm going to have success in making you understand the difference. I just hope that someone doesn't decide to do the same unaccountable mud-slinging to your name and reputation some day.

By GettingOlder (magellan) on Saturday, March 07, 2009 - 10:37 am:    Edit Post Delete Post
This one time, at band camp..
By AMO (amo) on Saturday, March 07, 2009 - 10:50 am:    Edit Post Delete Post
I don't believe what Mr Obama believes. No need for "transparency" here. No need for name calling TK. You're "almost 40", act like it. It's unreal to me how seriously people take this site. Time for a winter hobby fellas. Dudes, winter is almost over everything will be fine in a month or two. Go to the gym, go work one out, whatever, just go relieve some tension.

ONCE AGAIN, use your eyes to R-E-A-D. We are NOT, I AM NOT creating policy for Mr. Penske or Dorton, I am just simply creating conversation.

We'll all see how it shakes down. If I am wrong, which I hope I am, I will gladly eat my words in front of all of you. I am man enough to admit when I am wrong. And if I am right, I promise I won't say I told you so, because that would be a sad day for everyone if I am right.

Once again, Chapter 11 is restructuring, NOT liquidation. They are NOT going out of business and liquidating from what I am told, just POSSIBLY restructuring.

Damn people, you act like some one ran over your dog and smiled at you while they did it. Chill out and curb the testosterone.

By David Williams (wakeworld) on Saturday, March 07, 2009 - 10:56 am:    Edit Post Delete Post


It doesn't look like I'm going to have success in making you understand the difference.

Ding, ding, ding, ding, ding!! We have a winner!!


man enough to admit when I am wrong

Wow, it takes a big anonymous man to admit that he's anonymously wrong! I can't wait to pat you on your anonymous back!!

By AMO (amo) on Saturday, March 07, 2009 - 11:09 am:    Edit Post Delete Post
David, I play professional sports for a living, I am used to having my name mud slang all over the TV and publications. That's why what everyone is saying doesn't bother me. It IS a rumor that is all, you are all correct. If I got pissed off at every rumor spread about me, I wouldn't be able to do my job. You have your truth, I have my truth. But we will all have to sit and wait for the real truth. There are two people on this planet that know the real truth, Penske and Dorton. You don't have to believe me at all. It isn't my job to "report" David. That is your job, and you do a good job of it from what I can see. Just don't be naive to think Dorton was showing you all of his cards. I majored in broadcast journalism, I feel I have a good understanding of reporting and the media.

As for me attaching my real identity, I think you can understand why I don't feel the need to be known anymore than I already am. Which honestly, to you, isn't a lot. You wouldn't know me, but that doesn't mean someone else on this site wouldn't either. I dig the anonymity and so does my source. There are plenty of resourceful people on this site who are very smart. If you wanted to figure out who I am I'm sure you could.

By pete c (saceone) on Saturday, March 07, 2009 - 11:22 am:    Edit Post Delete Post
you're a pro $h1et d1i$turber man, that sounds like a dream job for DanDulong. Hook him up!

from montreal with love <3

By AMO (amo) on Saturday, March 07, 2009 - 11:26 am:    Edit Post Delete Post
Why would I reveal my source and myself? If i am wrong either way it doesn't matter whether you know me or you don't. Obviously you want to know who i am to figure out whether I am credible or not. I can totally understand that. Unless you can figure it out and then figure out my source it doesn't matter. I am irrelevant, the source is the big thing. I am simply trying to create conversation, not sling mud about a company that I bought a $91,000 boat from, and who I want to see succeed. I am as invested in MC doing well as the next MC owner.

You talked to Dorton, you got the low down from him, I don't trust CEO's. We are at a stand still. This is a disagreement, nothing more.

Let's all go back to being shiny happy people.

By jb (john211) on Saturday, March 07, 2009 - 11:28 am:    Edit Post Delete Post
"If you wanted to figure out who I am I'm sure you could." - AMO

... hmm ... is that a plea to be outed?

"Someone who is up in FL should start putting the feelers out to Blake Dalbech at Forest Lake motor sports, Mark at Son watersports, Andy at Midwest MC,..." - AMO

"Corey [at Midwest MC], it will be on the market September 1st. If he wants to look at it before that, I'll arrange it. I'll give you my contact info when I come pick up my boat from storage in May, or you can get my number from Dan the man Laughlin. Unfortunately, he won't be able to see the house until May. Hope that is ok. I'll sell it with the furniture if he wants it. The dock and the lifts are included as well." AMO

By AMO (amo) on Saturday, March 07, 2009 - 11:38 am:    Edit Post Delete Post
There you go JB! Good job.
By AMO (amo) on Saturday, March 07, 2009 - 11:45 am:    Edit Post Delete Post
No, no plea. But everyone is so intrigued. I don't care if you guys find out. I'm irrelevant, I told you. It's my source I won't give up. It's like saying to a reporter, "off the record", but everything on this site is obviously on the record. My source is a high up at a wake company and I can't have his reputation put on the line, if this is not true. I could care less about me. I am just a humble wake consumer.
By AMO (amo) on Saturday, March 07, 2009 - 11:46 am:    Edit Post Delete Post
I feel like I might be at GITMO during the Bush years. When does the water boarding torture start?
By GettingOlder (magellan) on Saturday, March 07, 2009 - 12:02 pm:    Edit Post Delete Post
When you are a part of flying a plane into a building and killing innocent Americans.

Water boarding is a walk in the park to what they should have received.

OK, back to the world coming to an end!

By AMO (amo) on Saturday, March 07, 2009 - 12:04 pm:    Edit Post Delete Post
^^^^^Totally agree.
By gangstar (joe_crawley) on Saturday, March 07, 2009 - 1:22 pm:    Edit Post Delete Post
How bout a hint- what professional sport do you play? By the way I consider myself a professional amateur wakeshuffler with some sick maneuvers.
By jb (john211) on Saturday, March 07, 2009 - 1:34 pm:    Edit Post Delete Post
yea, AMO, you were the fuel for the fire on this thread and it is definitely not the same without you. letís count the clues, AZ now, MN in may but selling home in Sept, pricey things all which are claimed to be paid for, but up for sale, 34. Would it make sense, spring ball, traded Twin, career winding down?
By AMO (amo) on Saturday, March 07, 2009 - 2:17 pm:    Edit Post Delete Post
Man you're good JB, I like you.

Gangstar, what is wakeshuffling?

Seriously fellas, I didn't mean for all of this to get out of hand like this. I didn't think David would even take me seriously. I just got back into the wake game after a 14 year break because of a professional sports career that is still ongoing. My last board before '07 was a Skurfer Rage. Ahhhhh, the good ole days riding in the dirty delta. Like I said before guys, I am irrelevant to the wake community. I'm just concerned with MC because I own one. I admit I'm a little upset with the way they have run things in Vonore over the last year or two. If anyone has any other info, other than what Mr. Dorton said to David, or what I have heard about restructuring I am all ears.

On another note, I am very blessed to be in the position that I am in and that does come with some perks, just as I am sure that many people on this site know a lot more people in the wake community than I do and get even more perks. I've had the opportunity to meet some people high up at certain wake companies, and I am very thankful to those people for being so good to me.

On an even cooler note, I just felt my first born kick in my wife's stomach. The coolest thing of all time.

By Karl De Looff (boarditup) on Saturday, March 07, 2009 - 4:09 pm:    Edit Post Delete Post
Keep in mind that debt and an organization can be restructured without bankruptcy. Any company with both debt and a structure that was based on a greater amount of sales than projected in the near and intermediate future would be foolish not to attempt to restructure both.

So, the "rumor" of restructuring is likely true. However, the "rumor" of bankruptcy is likely false. Given how well Penske typically runs his businesses, he will weather a downturn unless it lasts a long time. Given the pattern of former recessions, the company with the best product at the time of recovery reaps the benefit of pent-up demand. The leaders of MasterCraft know this and will position the company to take advantage of the recovery.

I do not have any special knowledge or sources although I have owned two MC boats.

By gangstar (joe_crawley) on Saturday, March 07, 2009 - 8:53 pm:    Edit Post Delete Post
AMO no hard feelings, hope spring is going well for you. It's just so many people come on hear and claim sources and spread rumors behind anonymity while most of the users of this site actually have identities and (not coincidentally) some valuable insight.

The good news is we'll know by this summer- if MC files for protection, you weren't a chump. If they don't...

By AMO (amo) on Saturday, March 07, 2009 - 10:00 pm:    Edit Post Delete Post
Karl, you sound like you definitely know more than I do. I was told restructuring (possible Chap 11), not full on Bankruptcy.

I don't know about you Karl, but I'm wondering when this stimulus plan is going to get credit flowing again into the dealers. They are the ones that are really getting hammered right now.

Gangstar, no hard feelings taken at all, if MC doesn't file my source was wrong and they were able to restructure without claiming Chap 11. It's happened before (me being wrong) and it will happen again, I'm sure of it.

You still didn't tell me what wake shuffling is

By michaelspsp (michaelspsp) on Sunday, March 08, 2009 - 7:01 am:    Edit Post Delete Post
AMO, i too am on my second MC. The MC dealer in NJ screwed me. she was sooo bad, MC pulled out of her dealership in 2006. i bought a 2005 x-2 from her (which was the x-star and now is the x-1, which was a hint about how mc does things).she never returned phone calls and never registered or titled my boat, and she had all my paperwork while she was the MC dealer. that fall MC had an ad campaign stating, get the x-2 for $39K. 10 months earlier i paid $53k for a fully loaded w mcx. so now MC screwed me. I bought a used 04 x-star from a guy who worked for the dealer in May 2006. i was told by the dealer, we can help you sell your x-2 no problem. well i ended up w 2 boat payments for 12 months. couldnt sell it because everyone said i can get a new one for $39k, which they couldnt. when i finally did sell the x-2 for much less than i thought i would when i bought it, she sent me the certificate of origin, filled out! if it was blank, i could have passed it on to the new owner no problem. i called mc, they said since she was no longer a mc dealer, i had to work it out w her! they couldnt produce another one. i didnt want to title the boat cuz i would have to pay taxes on a boat i just sold. well , the guy who bought my boat couldnt title it w/o getting a title from me so i had to eat it, again. ok, now that is out, i do love the MC boats, i do not like the MC upper MGMT. the problem w saying MC is going out of business or chapter 11 is that it can cause people not to buy a MC. that doesnt effect the upper MGMT, they will still make their big salaries, it does cause the guys who build the boats to get laid off. Ballys total fitness has been doing financial restructuring for over 10 years. Trump does it all the time. Many companies do as Karl said very well, i might add. its part of every day business for many companies. so saying "i cant see how they can avoid Chapter 11" isnt right. what do you personally know about their financials? you say you dont believe Dorton but you believe your source who you wont name. why is your source anymore trust worthy than Dorton? yes we can have great conversations on this site, but that is about rope length, weighing an x-star, best wakeboard etc, not about the financial stability of a company unless you show us all their financials...otherwise that is pure speculation on FACTS you and the rest of us dont have.
By AMO (amo) on Sunday, March 08, 2009 - 7:31 am:    Edit Post Delete Post
Michael, you are totally right. This thread is dead in my eyes. Like I said before, who am I? I am a nobody in the wake community, call me a chump, tell me I can't say certain things or speculate on certain things. No big deal.

People aren't buying boats because of what I am saying. That is ridiculous. People aren't buying boats because they are overpriced for this market and there is no credit flowing to the consumer for houses let alone "toys". No credit to some dealers for that matter.

Thread Dead. I'm out...........until Gangstar tells me what wakeshuffling is.

By WakeMikey (wakemikey) on Sunday, March 08, 2009 - 7:38 am:    Edit Post Delete Post
Boats are just like houses. Everyone wants a McMasion instead of a boat they can afford. People are finally realizing they are extended far beyond their means.
By michaelspsp (michaelspsp) on Sunday, March 08, 2009 - 7:42 am:    Edit Post Delete Post
people with money continue to buy. where i live a see a lot of new cars on the road. GM? Ford? Dodge? NOPE. BMW and mercedes. if someone started a rumor saying Mercedes was going chapter 11, more BMWs would be bought.... enough said.
By Jeff Walker (surfdad) on Sunday, March 08, 2009 - 7:44 am:    Edit Post Delete Post
I do believe this is some factual information:

The HSBC Investor High Yield Fixed Income Fund portfolio holds some of the MCBC Holdings, Inc junk bonds. MCBC Holdings, Inc is the parent company of Mastercraft Boats, LLC. The bonds held in this fund are paying 9.09%, mature 10/15/2014, and are callable on 10/15/09 at 103. HSBC indicates the bonds have a variable rate and are valued at 80% of face.

HTML of HSBC Investor High Yield Fixed Income Portfolio, July 2008:

Form the aforementioned report:

MCBC Holdings, Inc. 9.09%, 10/15/14, Callable 10/15/09 @ 103.00 (a)(b) 25,000 20,000

Overview of the original issuance of the bonds:

The overview of the issuance. This was from the period when Mastercraft was owned by US Equity Partners, the LBO firm run by Bruse Wassrstein, that sold MC to Charlesbank and Penske:

MASTERCRAFT BOAT CO., the maker of Saltwater and Maristar brand watercrafts owned by Bruce Wasserstein, plans to sell $105 million of floating-rate notes due in 2014. The company is marketing the notes to pay interest of 625 to 650 basis points more than London interbank offered rate. The debt will include a so-called poison put that would allow investors to sell the bonds back at 101 cents on the dollar if there is a change of control at the Vonore, Tennessee-based company. MCBC Holdings Inc. is issuing the debt. Jefferies & Co. is managing the offering. The deal is expected to price today.

I would think the call provision is what the rumor is all about.

By shane (auto) on Wednesday, March 11, 2009 - 7:43 am:    Edit Post Delete Post
If it comes down to believing the "press" a CEO of a major company is putting out or someone who comes across as knowledgeable and intelligent, I am going to go with AMO. You see it everyday on CNBC, the CEO comes on, yes everything is going fine, next week up. CEO is just another figurehead relaying what the equity investors PR team sanitized for him to say.
By Luke McCombs (wakemanlm) on Friday, March 13, 2009 - 9:01 am:    Edit Post Delete Post
I hate to say this but I know for a fact that mastercraft and malibu are in deep trouble. Its no secret in and around Knoxville. Its not going to stop me from Buying a boat though. I have a SAN210 now and have narrowed it down to another 210 or an X-45.... best wakes out there. The X-stars beam is too wide Much like my MB tomcat was.
By Nick Tomsyck (sidekicknicholas) on Friday, March 13, 2009 - 9:09 am:    Edit Post Delete Post
AMO is Kenny Powers.
Quote: " I play professional sports for a living, I am used to having my name mud slang all over the TV and publications. That's why what everyone is saying doesn't bother me."

Kenny F'n Powers.

By  matt c (curtisco24) on Friday, March 13, 2009 - 9:14 am:    Edit Post Delete Post
malibu has slowed production but they are not in deep trouble.
By Billy (woreout) on Friday, March 13, 2009 - 9:31 am:    Edit Post Delete Post
Who the hell is Kenny Powers?
And Luke the X45 is 2 inches wider than an XStar.

(Message edited by woreout on March 13, 2009)

By Hate N Pain (hatepain) on Friday, March 13, 2009 - 9:41 am:    Edit Post Delete Post
This is Kenny Powers...
By gangstar (joe_crawley) on Friday, March 13, 2009 - 9:43 am:    Edit Post Delete Post
I also laughed at that Billy, and the 210 is only 2" narrower than the star, WTF? Luke we need to get you into an X1
By Nick Tomsyck (sidekicknicholas) on Friday, March 13, 2009 - 9:58 am:    Edit Post Delete Post
Eastbound and Down (Kenny Powers).... its on HBO Sundays @ 9:30. It is awesome.

oh and Billy, want to buy me a plane ticket... spring break starts today for me.... thanks.

By Billy (woreout) on Friday, March 13, 2009 - 10:16 am:    Edit Post Delete Post
No but you can stay for free
By Nick Tomsyck (sidekicknicholas) on Friday, March 13, 2009 - 10:19 am:    Edit Post Delete Post
ha... I want to but I hate that drive, just doesn't seem that 48 hours of driving would be worth staying for like 120 hrs of staying there... I would fly but I'm pretty broke. Thanks for the offer though.
By Luke McCombs (wakemanlm) on Friday, March 13, 2009 - 10:44 am:    Edit Post Delete Post
actually when you account for the displacement of the cube on the back of the star it actually has more surface area. So I guess I Should have clarified that. I was at the factory the other day and we surfed a 45 with factory ballast and it looked pretty good. I dont think it is as good as the nautique surf wake with factory ballast though. The deals that Mastercraft are now are unbelievable though. The sales structure seems to be killing the MC dealers though.

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