CONTINUOUSWAVE

Perhaps related to the recent surge in demand for boats and outboard engines in general, there is some talk of BRP returning to the manufacturing of outboard engines, and with a new twist.

The legacy E-TEC engines (often called "G1" but never actually branded with that designator) would be re-launched under the JOHNSON branding.

The newer E-TEC G2 engines would be re-launched under the EVINRUDE branding.

An existing Evinrude dealer would be able to sell both Johnson and Evinrude branded E-TEC engines.

This rumor sounds quite wild, but stranger things than this have happened.

I hope that’s true.

I thought [BRP] were going re-tool their manufacturing facility.

Also, [a BRP outboard engine] might have to come in at a low-ball price to get folks that are hesitant to buy.

The re-tooling was for "Project Ghost". Maybe Project Ghost turns out to be making Johnson outboard engines.

It is just a rumor, but my source is usually well-informed.

If BRP held on to the ETEC tooling then it is conceivable. To re-start from scratch would be a monumental task.

Where is the objective quantifiable evidence for such wild speculation?

Wild speculation requires no evidence. I just heard the rumor. Feel free to ignore the rumor.

Fred Kiekafer expertly analyzes why the return of Evinrude is highly unlikely. Covid or not, BRP can’t overcome government regulation skewed against two stroke technology.

https://www.speedonthewater.com/what-re ... nrude/amp/

Mambo Minnow wrote:Fred Kiekafer expertly analyzes why the return of Evinrude is highly unlikely.

Based on that fellow's last name (which correctly spelled is Fred Kiekhaefer), I infer some preternatural bias against Evinrude.

Mercury had far more difficulty complying with EPA regulations than BRP did. Mercury's supercharged VERADO was hardly a solution to EPA compliance, and the demise of the use of supercharging in the current line of Mercury outboard engines is certainly evidence that they took a wrong turn in 2004 when they went with supercharging. Supercharging was fuel-inefficient and not very EPA compliant, and that is why you don't see any supercharging in all the new FOURSTROKE engines from Mercury. I think they are down to one or two supercharged VERADO in-line six-cylinder engines designated as race models. Their licensing of the Orbital Combustion Process for OptiMax has also gone away. The OptiMax was such a poor solution that Boston Whaler refused to sell them.

The Kiekhaefer fellow seems to ignore that BRP E-TEC engines were the cleanest, most EPA compliant outboards--and really most environmentally friendly as there was no dirty lubricating oil to dispose of. I don't find his analysis fits your description of "expert."

The topic "what really killed the E-TEC" is a fertile field for discussion, but the real answer is to be found in the bottom line, the profit being generated. If hundreds of millions in plant and facilities, and hundreds of employees are not generating return on investment, and the market trend is downward, and there is a spectre of a global pandemic and economic downturn, a dispassionate board of directors might pull the plug.

Exactly who knew or who predicted in April 2020 that sales of recreational boats and outboard engines would have unprecedented demand. I don't think anyone saw this boating boom coming in Spring 2020.

Mambo Minnow wrote:Fred Kiekafer expertly analyzes why the return of Evinrude is highly unlikely. Covid or not, BRP can’t overcome government regulation skewed against two stroke technology.

E-TEC is only dead in the marine setting and lives on in the snowmobile market where the focus on emission standards is also an ever increasing hurdle. In fact, the E-TEC engine is the sales leader in the snowmobile market where SkiDoo (owned by BRP) is the market share leader with a near 50% market share, with the other 3 brands sharing the other 50% market share. Of this, the Etec 600 and 850 motors represent the lions share of the SkiDoo sales, so to say Evinrude was mothballed due to emissions is shortsighted. To quote George Broughton from a 2018 article I shared on CW regarding E-TEC in the snowmobile market, "The goodness isn’t all wrung out of the grapes just yet." This was after the G2 snowmobile engines were released and the vision with E-TEC technology is in the development pipeline going forward due to its ability to meet the stringent emissions standards.

With Evinrude, my feeling is the demise of direc-injection (DI) two-stroke engines started in the late 1990s with Ficht technology that was adapted and rushed to market only to have an enormous impact on the perception of DI two-stroke technology. This continued into 2000 until the launch of the 2003-2004 Evinrude models under BRP where "Ficht" was intentionally removed from the product line. Evinrude then went on to redesign the engines, branded as E-TEC, but the tides were against Evinrude as Mercury, Suzuki, Yamaha, and Honda were offering competitive four-stroke engines that were quieter, and people flocked to this technology as being the future of outboards.

My feeling is if BPR reenters the outboard market with E-TEC technology it would not end well for them. The loyal dealers were burned twice, once with the bankruptcy of Evinrude (OMC) and then with Evinrude (BRP) pulling the rug out from under them and shuttering the Evinrude brand. Dealers were faced with live-or-die decisions to take on a replacement brand and invest heavily in training, tools, inventory and more to re-establish themselves as an outboard dealership and I highly doubt many of them would want to re-engage with Evinrude after such treatment.

It's a shame since the E-TEC G2 offering is a wonderful engine, but unless BRP are going to undercut the market leaders to make it an attractive value over the entrenched four-stroke offerings, BRP wouldn't stand a chance. I just don't see any upside after the missteps already made.

D-

The E-TEC engines seemed to be priced on the high side. I was never able to find what i considered a good price for an E-TEC within a reasonable distance from my house.

The perception that you have to get a four-stroke engine to go on Lake Tahoe or some of the other lakes in California also hurt Evinrude.

Just my opinion

Return to some limited production of just certain models seems possible. For example, the original three-cylinder E-TEC 90-HP and the 2.7-liter V6 150-HP for the legacy E-TEC, and the most recent E-TEC G2 115-HP and 140-HP models seem like possible renewed models. Those engines are attractive due to their lighter weight compared to competitors’ engines.

DT’ reminds us all that the E-TEC engines live on in other power sport products. In the SKI-DOO sleds they produce amazing power output per liter displacement.

Duckmanreno wrote:The perception that you have to get a four-stroke engine to go on Lake Tahoe or some of the other lakes in California also hurt Evinrude.

Yet the FACT that Mercury could not sell VERADO engines in California due to non-compliance with emissions is not considered as "hurting" Mercury?

The real FACT was the E-TEC was more compliant that any four-stroke. But a badly misinformed public has always been a problem, and today there is no better and faster way to misinformation than on-line.

jimh wrote:

Duckmanreno wrote:The perception that you have to get a four-stroke engine to go on Lake Tahoe or some of the other lakes in California also hurt Evinrude.

Yet the FACT that Mercury could not sell VERADO engines in California due to non-compliance with emissions is not considered as "hurting" Mercury?

The real FACT was the E-TEC was more compliant that any four-stroke. But a badly misinformed public has always been a problem, and today there is no better and faster way to misinformation than on-line.

I learn something every day here. I did not realize the VERADO could not be sold in California. I should have known that.
I am aware that the E-TEC was more compliant then the four strokes.

Duckmanreno wrote:I learn something every day here. I did not realize the VERADO could not be sold in California. I should have known that.

Yes, at one point Mercury had to lower the VERADO to be certified as only a Two-Star Compliant engine. Here is the text of c. 2006 article from IBI Magazine attributed to Michael Verdon, with portions highlighted:

Verado CARB rating change leaves unanswered questions
By IBI Magazine/Michael Verdon

Mercury Marine has recently made technical changes to Verado outboards shipped to US dealers by increasing its fuel efficiency in order to counter the rising price of fuel in the US. It began to ship the more fuel-efficient engines last month. But the increased efficiency, according to Mercury officials, has also meant an increase in hydrocarbon/NOX emissions levels. The higher emission levels has also prompted Mercury to downgrade Verado from the California Air Resources Board (CARB) Three Star designation to the "very low emissions" Two Star....

...The company will be allowed to sell the Two Star Verado in volume until January 1, 2008....

To be clear, after the Three-Star minimum went into effect in c.2009, a new engine rated as Two-Star compliant could still actually be sold in California, but only if the manufacturer was also selling enough engines rated as better than Three-Star compliant to bring their corporate engine sales mix total emission reduction to meet the Three-Star level. So in effect, a Two-Star compliant engine like a VERADO (at that time) could only be sold by Mercury in California to the extent that Mercury could keep their total outboard engine product mix sales in California compliant with the requirements of Three-Star reduction in emissions. All the emission regulations work that same way. There is a BASE level of emissions, and over the course of a long period of phasing in more and more restrictions, the total emission from all the new engines sold by a company would have to remain compliant with the required level of reduction in emissions. That meant that only by selling many engines whose emission output was lower than Three-Star, could Mercury then sell one Two-Star engine. Also, I think the horsepower mix was included, as a 300-HP Two-Star rated engine would put out a lot more of the regulated emission than could be compensated for by one 25-HP Three-Star engine. The practical effect was to put a lid on sales of VERADO engines in California as long as the VERADO remained at the Two-Star certification level.

I don't think Mercury really was very worried about VERADO sales in California. In the early days of VERADO about 99-percent of them were sold within 50-miles of Ft. Lauderdale, Florida, based on sighting reported by a website participant who saw them "everywhere" in that region, while in the Great Lakes it took me about eight years before I saw the first one actually on a boat and underway.

Since the sub-topic of Lake Tahoe and E-TEC engines came up in this thread, I did a two-second google search and came up with the following regarding how detailed the Lake Tahoe folks are in what's allowed on their lake: https://www.trpa.org/programs/watercraft/

hauptjm wrote:Since the sub-topic of Lake Tahoe and E-TEC engines came up in this thread, I did a two-second google search and came up with the following regarding how detailed the Lake Tahoe folks are in what's allowed on their lake: https://www.trpa.org/programs/watercraft/

Straight from the Tahoe Regional Planning Agency.

Outboard Engines:

ALL Four-Stroke Makes and Models such as:
- Honda
- Mercury
- Yamaha
- Johnson
- Suzuki
- Nissan

Direct Fuel-Injected (DFI) Two-Stroke Makes and Models such as:
- Evinrude E-TEC Direct Injection Engines
- Mercury Opti Max Direct Injection
- Yamaha High Pressure Direct Injection

D-

As demonstrated above, I do not believe there was any reasonable basis for an owner of an E-TEC to believe that the engine would be restricted in its use on Lake Tahoe, other than perhaps listening to dock talk from uninformed other boaters. The E-TEC engine was globally recognized for its outstanding achievement in reduction of emissions, so it would be hard to imagine that the residents of California were completely in the dark on that.

Great BRP statistics if you own a snow mobile, but I’m in Florida and this is a boating site.

I never mentioned Mercury, I’ve owned both Mercury’s and Evinrudes for the record.

Bottom line: Both E-Tec and Optimax were doomed due to Goverment environmental regulation.

If BRP held on to the ETEC tooling then it is conceivable. To re-start from scratch would be a monumental task.
Top

There is an anecdote that the Seiko management at one point had determined that with the development of quartz movements reaching maturity, all-mechanical watches were passé. They ordered the tooling for automatics to be destroyed.

But some employees disobeyed orders and stored the equipment. Of course, as everyone now knows, the automatic watch made a big comeback. Seiko sells huge quantities of them, in addition to quartz models.

I now have further information from a well-informed source that the production plant in Wisconsin that was making Evinrude E-TEC outboard engines has been re-configured for a different product. With that news, I now have no doubts that Evinrude E-TEC outboard engines are not going to return to production at any time in the near future.

I don't have any information about what the new product that will be made at the old E-TEC plant. Maybe it will be the previously touted Project Ghost or Project M.

Sad news. But perhaps they will store the tooling for another go at it in the future.

I don't have any information about what the new product that will be made at the old E-TEC plant. Maybe it will be the previously touted Project Ghost or Project M.

From the descriptions BRP has offered, I am having a hard time seeing how this "revolutionary" concept is different from inboard/outboards.

Evinrude went from having market share to insignificant and then out of business for outboards. I can't see any new product launch that would allow them long term success in the marine market at this point, unless they lauched a 4 stroke, but the competitors will do everything to squeeze them out.
R&D costs for a cleansheet powerhead are stratospheric compared to the new boat transoms they would have access to, not to mention all the dealers they now have soured relationships with having pulled the rug out from under them.

My 2006 Etec 250 still runs great and I feel it was a great purchase and would buy again, but I'm a super small sliver of the market.

D-

In addition to the supply chain interruptions and substantial increase in demand for boats and outboard motors during the pandemic period, I'm convinced that Evinrude's departure from the market was a significant contributor to the shortage of loose engines for repowering. I think it is feasible for BRP to re-enter the outboard market with their best selling products. The one large barrier to that may be that they no longer have dedicated transoms to supply engines to, having negotiated those away during their departure.

andygere wrote:In addition to the supply chain interruptions and substantial increase in demand for boats and outboard motors during the pandemic period, I'm convinced that Evinrude's departure from the market was a significant contributor to the shortage of loose engines for repowering. I think it is feasible for BRP to re-enter the outboard market with their best selling products. The one large barrier to that may be that they no longer have dedicated transoms to supply engines to, having negotiated those away during their departure.

Evinrude sales were already in the tank and a small percentage of the overall market. Their departure from the market doesn't explainty backorders of 52-56 weeks for some Merc and Yamaha models. The uptick in boat sales surley explains the backorder since outboard companies have more incentive to sell a motor destined for a new boat transom than repowers.

D-

I have curiosity about how intra-company sales of outboard engines to boat divisions are handled.

For example, Boston Whaler sells a boat with triple 300-HP FOURSTROKE Mercury engines. Let us assume the retail price of an engine is $33,000. We also assume that Mercury would sell these engines to an authorized dealer at a discount; for this example let us say at about 15-percent off list price, or $28,000. We also assume that the actual cost-of-goods-sold (CGS) for Mercury to make the engine includes an ample profit margin; let’s say 20-percent margin, so the CGS for the engine would then be about $22,400.

How does Brunswick handle the sale of three engines to Boston Whaler?

Which division of Brunswick gets to report the profit produced by the sale?

I am sure the sales manager at Mercury wants to show a profit on every engine they sell, but what price is put on the sale to a captive transom like Boston Whaler?

With creative accounting you could make the engine division more profitable or you could make the boat builder more profitable.

Who wins? Brunswick eventually has sold $99,000 of engines at their MSRP, but among Mercury, Boston Whaler, and the boat dealer, who gets to report the profit?

Jim, in the past I was involved in financing automobile and heavy truck dealers, and lots of other dealers/sellers of other products, in my experience the dealer made a small margin, maybe 10%. The manufacturers made the real profit margins. In addition, there was always an up front standard margin, then lots of behind the scenes volume discounts to big dealers or special discounts for fleet type sales.

Fleet sales prices to a rental car business were well below the cost paid by a local car dealer. On a Cadillac or Lincoln, the rental car companies got a 20-30% discount while a dealer was getting 10%, so selling cars after renting them for 6 months was very profitable.

The sale price for mercury outboards internally is likely a moving target for dealers, these days with a shortage of outboards, the markups at all levels are likely at the high end, whatever they are?

What I find interesting is the BRP 2022 financial guidence details the marine segment is estimated up 18-23%, this fiscal year, for an estimated $420.9M in revenue (FY22 year). This is amazing considering the wind down of Evinrude operations was back in 2020, so there's little to no contribution from Evinrude production in these numbers, but maybe some parts revenue. BRP retail boat sales carried that number with an increase 71% on the quarter closing Apr 30 2021 (Q1FY2022).

This hints towards how insinificant Evinrude was to BRP as a revenue source and profit generator.

D-

Maybe what Evinrude needed was for employees to buy out the company from BRP with some creative financing.

Now we wait to see what product is going to come out of the very modern assembly plant in Sturtevant, WIsconsin.