Brunswick CEO on Consumer Spending, Tariffs, and Boating Outlook

Third Quarter Performance

• 📈 Brunswick reported a strong third quarter with sales rising nearly 8% across all business units.
• ✅ All four reporting segments exceeded guidance and consensus for both top-line and bottom-line results.
• 💡 The company observed a stabilization in the consumer market, particularly noting strength in buyers of premium boats.

Tariff Impact and Mitigation

• ⚠️ Tariffs are estimated to have a full-year impact of approximately $75 million on Brunswick's business, primarily from China-based tariffs.
• 🛠️ Brunswick is actively working to reduce tariff exposure by decreasing content purchased from China and increasing domestic sourcing and vertical integration.
• 🇺🇸 As a US manufacturer with facilities in 21 states, Brunswick is well-positioned to handle persistent tariffs, potentially gaining an advantage over competitors facing import tariffs.

Consumer Spending and Gasoline Prices

• 🧐 While some cracks were initially anticipated in consumer spending, the market has stabilized, with even value boat purchases showing signs of improvement.
• ⛽ Lower gasoline prices are generally helpful, but Brunswick only sees a material change in boating behavior if prices consistently exceed $5 per gallon.
• 📉 Current gasoline prices are stable and historically low, not acting as an inhibitor to boating activities.

Manufacturing and Competitive Landscape

• 🏭 Approximately 75% of Brunswick's products are manufactured in the US, with a similar percentage of its supply base being domestic.
• ⚙️ The Mercury Marine business, which manufactures engines in the US, benefits from import tariffs on its Japanese competitors.
• 🎯 Brunswick is considered foundationally well-placed to navigate various business environments, including those with ongoing tariff impacts.