The Northpoint Navigator is pleased to introduce a new column, Canadian Corner, co-authored by Northpoint Canada’s Executive Vice President/GM Chris Cook and Vice President Business Development Chantal Robin. In this inaugural column, Chris and Chantal provide an important overview of the latest issues and developments within the Canadian marine industry.
In November 2023, an exciting new marine industry association was established – the Canadian Marine Retailers Association. This new organization effectively unites all provincial marine trade associations to provide a strong national voice on key federal issues facing the boating industry. The group includes representation from Boating Atlantic, Nautisme Quebec, Boating Ontario, Mid Canada Marine & Powersports Dealer Association and Boating BC.
Northpoint is very proud to engage as an associate member of many of these outstanding associations, and we strongly support the collective effort of the newly launched CMRA.
According to the CMRA, top priorities for the coalition include access to water; repealing the luxury tax; advocating for critical investments to upgrade waterway infrastructure; dedicating additional resources to identify and combat aquatic invasive species; and supporting research and development for the reduction of carbon footprints in the marine industry.
Of special interest regarding the current luxury tax status, two national Canadian surveys were conducted on this topic, the first from the period of May 2021 to May 2022. A second survey was conducted in the Fall of 2023 including the participation of all provincial marine trade associations which resulted in a field of 32 Canadian retail respondents. Retailers were asked to report lost sales due to the luxury tax and to document business decisions involving inventory replenishment where concerns about product potentially sitting idle on floorplans impacted purchasing decisions.
KEY FINDINGS
• Before the luxury tax officially began, the Canadian Revenue Agency estimated it would collect $52 million in taxes in the first 24 months, but at the 21-month mark, only $12 million had been collected due to waning sales.
• Retailers collectively estimated lost sales of $211 million.
• Retailers reported zero net gains in sales under the $250,000 luxury tax threshold.
• A notable 81% decline in dealer willingness to assume inventory risk was documented.
• One more significant survey result: retailers reported an average loss of 2.34 jobs.
TWO INSIGHTFUL QUOTES FROM SURVEY PARTICIPANTS
“Customers will not pay the tax and dealers are not buying the inventory.” And … “The 1991 US luxury tax failed and was repealed, and we are watching history repeat itself in Canada.”
Northpoint Canada continues to actively monitor these current conditions and to maintain a strong presence throughout our marine market. We strongly support the efforts and interests of our valued retail and manufacturing/OEM customers, evidenced by the latest results of our own 2023 customer satisfaction survey which noted 97% of our Canadian customers believe Northpoint’s Canadian team “exceeds expectations in both service and offerings.”
We very much appreciate the opportunity to participate in the Northpoint Navigator and to share important Canadian marine news. As always, we welcome feedback and remain on standby to assist and support our customers however needed.
