Brunswick shows off autonomous, electric boats
Brunswick (BC) showcased some of its new boats and power technology at their media day. A recent report projects significant growth in the electric boat market, which could reach $7.7 billion by 2030. Yahoo Finance Senior Reporter Pras Subramanian spoke with David Foulkes, Brunswick's CEO, all about the new developments in boating technology and how inflation is impacting the boating industry. Foulkes expounds by explaining how the company has a "very resilient consumer base," and that the "electrification" of everything is well underway due to changing tastes and government regulations.
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Video Transcript
PRAS SUBRAMANIAN: We're in the Chelsea Piers area near off the water here in Manhattan. Brunswick, the largest maker of pleasure boats in the world having their media day here. But we're on a special boat right now. Dave Foulkes, CEO of Brunswick joins me now.
So Dave, a lot of things going on, a lot of boats on display, but we're on a special boat here. It's autonomous. Tell me about it.
DAVID FOULKES: It is. It's a Boston Whaler-- it's one of our best brands, premium brands-- 405 Conquest, but has a lot of technology on board this one. And as you mentioned, a development system that allows you to dock the boat autonomously, which is familiar technology for cars but new technology for boats. So we're very excited about it.
PRAS SUBRAMANIAN: Yeah, so basically from my understanding, it can auto dock it for you. Right now we're using a technology called skyhook where it's using the motors and GPS, right, to keep us in place?
DAVID FOULKES: Yeah, frequently you want to hold a boat in position. Because of waves, and wind, and current, it takes quite a bit of effort. So the skyhook system takes all of that away-- all of that effort away.
It uses GPS system and maneuvers the engines to hold the boat exactly in position. Not just in the same position, but the same orientation as well. So it takes a lot of stress out of that particular maneuver.
PRAS SUBRAMANIAN: So Brunswick, we're not just here for the fun on the water. Brunswick had its investor day yesterday talking about the future of the brand. A big part of that is electrification. And not just electric boats which we'll get into, but also stuff like house power. So talk to me about that exactly.
DAVID FOULKES: Yeah, we can use electrification for propulsion on smaller boats. But on a big boat like this requires quite a lot of power, it's much tougher to do. But there's another engine on a boat that not many people know about called generator. And that powers all of the systems other than propulsion, so all of the air conditioning systems, all of the environmental control systems, the entertainment systems on the boat, the electronics.
And in this boat instead of having a diesel-powered generator, we have a large capacity lithium ion battery pack, about 20 or so kilowatt hours, that powers everything on the boat. And you can see right now it's very quiet, there's no vibration, no fumes, no emissions. And this particular pack has another eight hours of power left. And when the power runs down, you switch on the main propulsion engines and it charges it back up again. So much more efficient and environmentally friendly.
PRAS SUBRAMANIAN: Now you mentioned these smaller boats that will be electric powered that we saw some. There's a Veer boat out here that got its electric motor, the Avator series electric-- sorry, electric outboard motors. We've got a taste of that in Wisconsin recently, which we'll see that coming up soon. But talk to me about the, kind of, the business opportunity that electrification offers. I know it's very early innings here, but what does that mean to you exactly?
DAVID FOULKES: It is early innings, but everybody sees electrification all around them, particularly in passenger vehicles. And it's coming into-- marine is a bit more of a challenging environment for electrification. Partly that's obvious. But partly, boats a much more weight sensitive for the batteries. They require more power.
But we can electrify small boats. We've just introduced a whole series of new small electric outboards, as you said, called Avator designed to power small boats. We only launched them in April. We've already sold 2,000, which is a big number for marine space.
They're popular in the US, but particularly in Europe, where there are a lot of regulated lakes that don't allow combustion engines anymore. So this is an important market for us to get into. And as the technology evolves, we'll move electrification into bigger and bigger products.
PRAS SUBRAMANIAN: You mentioned that the-- it's not just what the customer wants. It's also what governments want, so that's kind of a big mover in that space. Talking about the future of boating here, you know, there's a man riding around in an electric foil of some sort. Looks like he's from the future.
It's really cool stuff, but I know that you guys are getting into this, sort of, very recreational type of, you know, few hours here and there, hop on the board, have fun. Is it the future? Is it e-fuels? Is it that? What are we talking about here?
DAVID FOULKES: Yeah, we see a multi-fuel future for boats. Boats are a bit more like aircraft or commercial vehicles, you can't electrify everything. That doesn't mean you can't make it more efficient and more sustainable. You can certainly make our engines more efficient. And we're very interested in things like e-fuels and alternative fuels for some of the bigger boats.
But part of our job-- we're the biggest company in the industry-- is to just get people on the water in a sustainable way. So we provide-- we have multiple brands with multiple price points to get people out on the water. This is one of our bigger boats. We make very small boats, including the electric ones.
And running around, as you said right now, is an e-foil, which is like a surfboard except it's got a foiling element underneath it and it's electrically powered. So a lot of people like wake sports right now or windsurfing, this is an electrified alternative. This guy going around us can go for three or four hours on that thing. It is super fun, very exciting, and yet another way to get people out on the water.
PRAS SUBRAMANIAN: So, you know, boating is what? I think a 50 billion industry in the US recreational boating. How big of a sliver is that e-foil that's circling around us.
DAVID FOULKES: You know, that market is still pretty nascent. We're excited because we have one of the best brands in the market. It's probably about $100 million market right now, but we think there's a lot of opportunity for growth in that market.
A lot of people are not even exposed to this so far. You saw one, you'd be taken aback. As soon as that gets more exposure, I would expect the market to grow pretty quickly.
PRAS SUBRAMANIAN: So talking about stuff like that, that e-foil technology and what people are looking into, you have your pulse on the consumer. Spending on boats is a very discretionary purchase here. But people love it, but it's not-- you don't necessarily need it.
But you offer a number of products across a number of price points, including that e-foil and this lovely Boston Whaler. What is the consumer telling you-- the boating consumer telling you these days? Are things the same, getting better, or getting worse?
DAVID FOULKES: Well, you'd have to say that consumers everywhere are under more pressure at the moment than they were three or four years ago. Certainly the cumulative impact of inflation and the interest rates, if you're financing a product like this, that certainly has an impact. But we survey boaters a lot and understand what they're thinking.
80% of boaters say boating is part of their lifestyle. They'll always be in it. They'll never change. More than 90% of boaters say that they will be in boating at least for the next five years.
So we have a very resilient consumer base. Of course, some of them are under pressure and we can help with that. We can offer some discounts or promotions maybe to help them into the product, which we certainly will do. But fundamentally, it is a great lifestyle product and a very resilient marketplace.
PRAS SUBRAMANIAN: So real quick, what's your favorite boat that you have out here? Real quick, real quick, is it the--
DAVID FOULKES: Oh, this is my favorite boat that I have. It's a beautiful boat, multipurpose boat. The Boston Whaler brand is such a strong brand and it really attracts great technology, I think. Boat this size with this capability, you can just load it up with that value-add technology and bring it to market in a way that people really appreciate.
