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ContinuousWave Whaler Moderated Discussion Areas ContinuousWave: The Whaler GAM or General Area Brunswick's CEO Still Teasing Us on Project-X
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Author | Topic: Brunswick's CEO Still Teasing Us on Project-X |
jimh |
posted 08-07-2003 11:04 PM ET (US)
The marine press has been filled with comments, innuendo--even test drives--of the Project-X engine, but the appearance of it on the market is now apparently driven back to 2004 at the earliest .Buried in the most recent webcast from Brunswick CEO George Buckley were some interesting comments about the Project-X high performance 4-stroke engine. Amid all the financials and earnings minutia, Buckley did report this annecdote. While at a dealer meeting, Buckley tells of a representative of an OEM Bass Boat company who had a chance to test drive the new engine. "Do you guys know what you've got here," was the rhetorical question he posed to Buckley. Apparently the inference is the test drive was very impressive. Buckley also emphasized the overall goal of the "project-X" engine from its very beginning: to be the Ferrari or Porsche of outboards. By the way, to hear the webcast you apparently must use a Windows browser and operating system. No amount of fiddling will let me hear it on my Macintosh OS X machine. You also must accept cookies or you don't get very far into the process. I guess Brunswick thinks all the financial guys will be running Windows anyways. Sometimes when I post these notices I get accused of being a Mercury cheerleader. I can tell you this: being able to listen to the CEO and the CFO of the company that owns both Mercury and Boston Whaler is, to me, a very handle resource. (Even if I have to use a Windows machine to do it.) If the CEO and CFO of Yamaha or Honda or Bombardier made periodic webcasts and answered questions, I'd go listen to them, too. And I would report what I heard, as I am here. But those other outboard makers don't put the CEO of their parent companies on-line four times year to let him make his case with Wall Street analysts, so I can't report those non-events. Back to the webcast, Buckley again blamed some of the margin loss in the domestic outboard market on the "huge" shipment of Japanese product by boat, timed to beat the dock worker's strike on the west coast. This giant bulge is making its way through distribution and into the market place, forcing pricing down. For the consumer, that may be good news. This may be an excellent time to buy a new outboard. Retailers don't have much upward price flexibility, and there is plenty of product in the channel in some Japanese brands. From an investor point of view, Mercury has done a good job of holding their inventory and supply down to match the (declining) market. Finally, when the big Project-X engine does appear, Buckley predicts it will be a "sell-out". Hear it for yourself at: http://www.brunswick.com/ (Click Investor Info) |
lhg |
posted 08-08-2003 03:32 PM ET (US)
Jim: The outboard engine "dumping" Buckley was talking about is from Suzuki. Even here I have noticed an increase in Suzuki engine shopping talk for Whalers as this works it's way into the market. MBA's call this practice the theory of "Unsustainable Pricing in a Hyper-Competitive Market" (to gain market share). It seems to be working. Until recently, gold painted Suzuki 2-strokes have been a non-force in the US outboard market. Now, they are really pushing the black 4-strokes, which are excellent, evidently. I'm sure Mercury is really bugged about the black paint rip-off. It seems an un-spoken rule in the outboard industry not to copy someone else's paint colors has been broken by Suzuki. Just this week, my Mercury Dealer told me the new 250 HP 4-stroke is due out end of this month. Maybe that has been pushed back again? |
jimh |
posted 08-09-2003 11:50 PM ET (US)
Regarding competition like that from Suzuki, CEO Buckley commented" "Price is not a competitive weapon...cost is a competitive weapon." |
acseatsri |
posted 08-10-2003 01:08 AM ET (US)
"MBA's call this practice the theory of "Unsustainable Pricing in a Hyper-Competitive Market" (to gain market share). It seems to be working." In the world of finance, we like to call it "deflation". Don't count on it being unsustainable. Just look at what's happening with our automakers. The discounts and financing continue to get ever larger to move inventory. Consumers are now conditioned like Pavlov's dog to demand ever bigger deals and incentives to sign on the bottom line. |
jimh |
posted 08-10-2003 01:13 PM ET (US)
Economic Theory is an interesting study. Let's say that the cost to make a 90-HP outboard for both Suzuki and Mercury is $5,000. If competition drives the price down to, say, $2,000. Mercury could drive Suzuki out of business by advertising "FREE" engines. Customers would come to Mercury for their free engine, and Mercury could give them a $2,000 voucher to go buy a Suzuki. Suzuki would lose $3,000 on each engine they sold. Mercury would only lose $2,000 on their "free" engines. Or so the economic theory goes. |
kgregg |
posted 08-12-2003 01:18 PM ET (US)
from Aug 10 SunSpot.net [Removed copyrighted article that was posted here; we prefer to not violate the copyright of others and hope that they respect ours. Please follow the link to read article.] |
tbyrne |
posted 08-12-2003 01:29 PM ET (US)
And Yamaha is always getting bashed for "vapor ware"? I know the engine will be on the market soon enough and that they are delaying to be sure to get it right, but I can't help thinking that if Yamaha had marketed a "new and improved" motor with such an extended whisper campaign, everyone would be grousing the way they did when Yamaha kept delaying the introduction of their six cylinder four-stroke. |
lhg |
posted 08-12-2003 04:44 PM ET (US)
Did I read that right? A measly 2.6 liter in-line-6 4-stroke (HP unknown) blows away a 225HP 3.1 liter V-Max two stroke EFI? Or was the Yamaha 225 a 3.3 liter V-Max HPDI? |
JBCornwell |
posted 08-12-2003 04:50 PM ET (US)
Hmmm. I'm not teased, I'm bored. Red sky at night. . . |
PSW |
posted 08-12-2003 06:50 PM ET (US)
The big boat builders like Tiara Pursuit are definately thinking these big outboards will be a hit. I talked to the local dealer and asked how the new 3370 and 3070 was going to be powered since the inboard version uses atleast 600 horsepower and he said they have some options. I asked if he was aware of the new Yamaha 300 and the Merc Project X and he said that he was aware of both and so was pursuit. Should be pretty interesting to see that set up when they come out. I am heading down to the water on Thursday to check out the new 3100 offshore that utilizes the the vacuum pressure resin sytem for reducing weight and improving quality. You have to love technology. Maybe I will go in my classic Montauk with old 2 stroke Mercury 115.
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BillB |
posted 08-12-2003 06:58 PM ET (US)
See JB? That's how you get bored enough to post to "Forum or against 'em" ;) Bill |
jimh |
posted 08-12-2003 08:02 PM ET (US)
[Removed copyrighted material; see above--jimh] |
Peter |
posted 08-12-2003 08:46 PM ET (US)
One of the other notable things buried in the webcast: Buckley said something to the effect that more outboard production would be moved offshore -- to China I believe. So much for "Made in America". Unfortunately, I think Mercury has no choice but to do it to remain competitive. That leads me to think, if Mercury had substantial production already in China and rushed a shipment of outboards produced in China into the US to beat the dock worker's strike of unknowable length, would Mercury have been accused of "dumping"? One comment on the use of color. As far as I know, Mercury does not hold the exclusive right to use the color black for outboard engines. Most manufacturers have probably stayed away from black for functional reasons -- it gets pretty damn hot in the summer sun. However, the use of the color black is likely becoming more popular in an attempt to hide or otherwise obscure the bulk of the 4-strokes. Regarding the economic theory, I think most businessmen would call that "destructive competition". |
jimh |
posted 08-13-2003 01:01 AM ET (US)
Yes, I recall some mention of "Asian partners" in connection with production of outboards in certain power ranges. It is fun to read between the lines on these presentations. Good link to that article on the "hush-hush" test ride. |
jimh |
posted 09-11-2003 02:55 AM ET (US)
Mercury is still teasing us with sightings of the Project-X outboards. This homegrown article shows CEO George Buckley inspecting the assembly line that (will) make the new engine. http://www.mercurymarine.com/8226project_x_makes_huge_waves_no_noise_in_new_orleans |
lhg |
posted 09-11-2003 03:24 PM ET (US)
These are starting to sound like perfect twin power for a 25 Outrage/Revenge! I never thought the 200 EFI's could be improved upon, but I might be wrong. Time to start saving. |
Eric |
posted 09-12-2003 08:59 PM ET (US)
It will be interesting to see how this new technology weighs in (literally). More to the point: will the engines be light enough to power older boats that don't have as high of a transom weight capacity? If they're doing as has been speculated, making a lighter, smaller displacement engine with forced induction, that could be a distinct possibility. I suspect that there's a lot of owners of older boats that would love to run a 4 stroke if the weight factor could be addressed. |
lhg |
posted 09-12-2003 09:33 PM ET (US)
From what I have READ (I'm only the messenger here) the 200-250 HP engines will be relatively light, probably a hundred pounds or so less than the current crop of 225 4-strokes. This would put them in the range of the Optimax engines, where a 225 weighs about 500# against the 600# of the 4-strokes. So this would mean the 250HP version would weigh less than Honda's 115/130's! This should be quite attractive. I'll bet they're premium priced, however. The in-line six configuration seems to make some sense in According to JinH's link on another thread, the engines will be built in Fon du Lac WI, Mercury's "hometown". |
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