Mar. 10, 2008 – Introductory models take market lead

By Jeff Hemmel
Contributing writer
Not that many years ago, numerous industry insiders predicted an affordable four-stroke would be the Holy Grail for PWC manufacturers. Some argued it simply couldn’t be done. Yamaha, however, proved otherwise. A year later Sea-Doo followed and the revolution was under way. Economical four-strokes arrived en masse and quickly became some of the best selling models on the market.
Powersports Business recently took a closer look at the existing crop of introductory candidates, Kawasaki’s bold move into the market, and whether these models are still as affordable as they once seemed.

Chart toppers
While many would argue the innovation is over and little new is happening at the low end of the market, this is a category that remains one of the hottest in the overall market. In 2007, Yamaha placed not one, but two of its affordable VX models into the overall top five in retail sales. The original inexpensive four-stroke model, the now four-craft deep VX line, is rapidly showing its maturity. From the rental-targeted base model VX ($7,399), Yamaha now features the Sport ($7,599), Deluxe ($7,999) and Cruiser ($8,399) in the VX lineage, each offering a step up the scale in terms of features and amenities. It was the Deluxe that was 2006’s top seller. Last year, the Cruiser took center stage.
All four Yamaha models continue to be powered by the same 1052cc engine rated at an even 110 horsepower. It powers the VX line to a 55 mph top speed and reaches the magic 30 mph mark in about three seconds. The best-selling Deluxe features reverse, rearview mirrors and an RPM-limiting mode activated by a remote fob. The latter also acts as a theft-prevention device. The Cruiser, added last year, brings the cushy touring seat from the FX line to the entry-level market.
Sea-Doo, meanwhile, continues to offer two low-price models, the GTI ($7,799) and GTI SE 130 ($8,699). Both distinguish themselves with old-school handling, relying on a flatter deadrise hull to slide through a corner when desired, yet still hook up with precision when necessary. The base model, lacking a speedometer, comes in below $8,000 and features Sea-Doo’s familiar O.P.A.S. off-throttle, off-power steering assistance and an extra, “Learning Key” lanyard for limiting RPM. The SE adds mirrors, boarding ladder, ski tow eye, lakewater temp sensor and a contoured, stitched seat, as well as premium footwell mats. Both Sea-Doo models also offer reverse. Performance is on par with the Yamaha offerings in the class, with a 55 mph top speed and three second 0-30 acceleration time.

New kid on the block
Where’s Kawasaki? Until now, the Big Green has merely dabbled in the intro game. For 2008, however, the company has the potential to gain dramatic market share. Unlike Yamaha and Sea-Doo, which developed a detuned four-stroke engine and put it into a new, user-friendly hull, Kawasaki has opted for good old-fashioned, trickle-down economics. Its former player in this arena, the STX-12F, already had its price reduced to compete in this end of the market. For ’08, however, the company went farther up the food chain, taking the one-time flagship STX-15F and slashing $1,400 off the asking price. Now listed at a mere $8,099, the 15F will no doubt test the waters for a higher performance intro offering, featuring the performance of a 160hp engine (a 62 mph top speed and sub 2.0-second 0-30 mph acceleration), the handling of a one-time racer and a full complement of features. And it will do it at a price that is lower than both competitors’ most fully featured model.
“The STX-15F is a strong model, and it gives the customer top-level performance at an entry-level price,” Kawasaki’s Patrick Kelley said following news of the price cut. “So yes, we think it should do very well in 2008 against the competition in its league.”
And continue to add to the strength of the introductory market. “The addition of another boat to the value-oriented and first-time buyer segment further confirms the importance of this segment in the market place,” said Bryan Seti, head of marketing for Yamaha Watercraft Group. “This is a large group — consisting of buyers at one end of the spectrum who are buying our VX series for $7,399 and buyers at the other end who are willing to pay $1,000-$1,500 more for a boat with additional features and performance. I think the trend here, which you’ve seen Yamaha perpetuate with the addition of the VX Cruiser, is that this market segment is larger than we might once have thought, and it might be starting to bleed into the more mid-range buyer group looking for more features.”

Still a deal?
That final comment brings up an interesting dilemma. As the intro models continue to offer more and more for the money, the midrange models might struggle to find their place in the family hierarchy. Off the record, several OEM sources indicate they might very well replace the current midrange models in coming years.
It also begs a question: Have the intro models, once clear bargains, gone too far up the price scale? When it debuted, the Yamaha VX could be had for $6,999. Now, it costs into the mid $7,000 range just to enter the market, $8,000 or more to get a well-outfitted model. An inevitable comparison to the snowmobile market brings up the fact that base sleds can be had for as little as $6,000.
Manufacturers will rightly point out that it costs more to produce a PWC. One key reason is the engine. “We need more horsepower versus a snowmobile to deliver the same fun factor,” explains Sea-Doo’s Louis Levesque. “Also, snowmobiles still use two-stroke technology in their point of entry models, we don’t anymore due to CARB/EPA.” Snowmobiles and ATV also minimize cost with simple framing; PWC use fiberglass and other materials to ensure flotation and meet industry guidelines. A little perspective, however, also goes a long way. Today’s entry-level models offer all the features of the premier craft of a decade earlier, plus a great deal more. Horsepower and four-stroke technology is obvious, but consumers also benefit from things like off-throttle steering solutions, rev-limiting systems, advanced instrumentation, even precision reverse mechanisms that make for easier handling around the dock and launch ramp. And yet, the price of these impressive introductory models — not even adjusted for inflation — is still comparable to what customers paid a decade ago. “For the same type of horsepower, the price is pretty much the same versus 1998,” continued Levesque. “A 1998 GTX Limited with 130HP was $7700, and a 2008 GTI with 130HP is $7799. This is a major achievement to keep 2008 pricing in line with 1998 for the same type of horsepower but with more features.”
The intro models continue to be just what the manufacturers intended — some of the best deals on the market.