Prime Time for Electrifying the Waterways
Now, the EV revolution is unfolding on the waterways, but the lessons of the crowded roadways have been learned. This time, it’s not about cash burn. It’s smarter, if you know where to look.
The recreational boat market is worth nearly
$19 billion today, and it’s projected to reach nearly $26 billion by 2028—in just four-and-a-half years. That’s an astounding growth rate, and it’s all because of a push to go electric, including the adoption of emissions-free transportation and government policies that are hyper-advantageous to this segment.
The smart and first-mover advantage goes to
Vision Marine Technologies (NASDAQ:VMAR), with its proprietary E-Motion powertrain outboard motor that
can turn any speedboat into the fastest electric version in its class on the market.
The cash-burn is not there because VMAR is selling directly to OEMs (original equipment manufacturers). It’s not trying to build boats. It’s making smart partnerships with battery makers and engineers and tapping into a boat-building market that has to do only one thing to make this viral: Fit an award-winning electric motor on the back, instead of a noisy, polluting and expensively maintained gasoline-powered outboard.
Nor is it just about speedboats, either. VMAR’s E-Motion fully electric outboard engine technology can be used on pontoons—a recreational trend worldwide.
VMAR is also gearing up to flip the massive boat rental market into an electric bonanza.
It’s time to find a new niche in the EV segment, and these innovators and first-movers have a very clear advantage.
The Electric Boat Motor That Changes Everything
In partnership with VMAR, veteran boat maker Four Winns unveiled the new
H2e Bowrider speed boat at the Paris Boat Show in December, and then made its official debut in February in Miami, with deliveries to start this summer.
The speedboat showcases VMAR’s E-Motion 180 HP electric outboard motor with proprietary powertrain technology. That motor makes the H2e Bowrider the first all-electric series production bowrider on the market.
And VMAR’s E-Motion is the first fully electric, production-ready, high-performance 180 HP outboard motor on the market, as well.
The powertrain can provide a consistent 180 HP of pure electric power, with cutting-edge high voltage power when you need it most, and a completely scalable power bank.
The proprietary technology is end-to-end: It includes the batteries, the engine, and the software, making it the only turn-key solution for boat manufacturers in its class.
The E-Motion outboard motor can fully charge overnight with no additional infrastructure and boasts the highest horsepower engine in its class. And from a price perspective, it out-competes everyone else, which should help it to capture new market share.
The bigger picture here is that VMAR’s technology system can turn any boat instantly into an electric boat.
This month,
Vision Marine (NASDAQ:VMAR)is busy equipping a pontoon with electric propulsion and solar panels for the longest known electric boat run in America (and possibly in the world).
VMAR’s Zenith pontoonwith set off in Virginia on a 1,050-nautical-mile journey to Miami, Florida, to showcase the capabilities of sustainable electric power.
VMAR has also secured a manufacture & supply agreement with McLaren Engineering, a wholly owned subsidiary of Linamar Corp. That means reliable production, at scale.
McLaren’s role in this means protection against supply chain bottlenecks, with more than 90% of components sourced in North America and a production capacity of up to 18,000 E-Motion outboard motors annually.
Last September, right out of the gate, VMAR received an initial purchase order from the North America’s Limestone Boat Company for $2 million worth (25 units) of E-Motion 180E outboard motors and powertrain systems. Limestone is now moving into scheduled production, with a delivery target to dealers set to begin in 2024.
Vision Marine is expecting its first revenues from powertrain this year.
While it’s been all about build-out and launch over the past couple of years, VMAR is positioned to be free-cash-flow positive next year--a rarity in an EV segment where car manufacturers have largely run out of money to keep manufacturing and where profitability remains highly elusive.
The $18B Global Boat Rental Market, Ripe for Electrification
The global boat rental market (across all boat types) was valued at
$18.2 billion in 2021, and is projected to reach $31.2 billion by 2031, growing at a CAGR of 5.7% from 2022 to 2031. It’s a huge market that is about to go electric.
And it’s not just about the environment … Electric boats are considered a better experience all around, from the noise-less enjoyment to the
ease of maintenanceand lower operating costs in the longer-term.
And, again, VMAR has a first-mover advantage.
VMAR’s flagship Newport Beach business managed to serve 300,000 clients in the first three years, annualizing $4 million in revenues with a 35% profit margin. In March, the company opened its second electric boat rental operation in Portside Ventura Harbor, California. Later this year, VMAR will roll out a third fully owned electric boat rental location and launch their franchise model. Next year is also out scaling up with speed.
A Brilliant Outlook for Marine Batteries
EV battery maker stocks are soaring, unlike their chaotic car manufacturing counterparts. Just this week, Chinese battery maker CATL reported earnings showing a 63% spike in profits and excellent guidance.
The same positive fate looks set for the marine battery market, where
Vision Marine (NASDAQ:VMAR) boasts proprietary technology that it has quietly been developing for a decade, with certified battery cells and custom designed marine-grade battery packs. It also has a partnership deal with Octillion, which has a production capacity of up to 5,000 batteries per day.
As we speak, the multi-billion-dollar boat battery market is undergoing its biggest transition since the invention of the boat motor itself. Not only is the
marine battery marketforecast to grow by 18.6% to 2030, but it may represent a $2-billion opportunity for investors over the next five years.
Breaking Records All Over the Place
VMAR is out to make history, and it’s already broken a number of records, making it one of the most exciting smaller EV plays on the NASDAQ at a time when investors are growing increasingly frustrated on the roadways.
It’s a first-of-its-kind proprietary outboard motor and powertrain, powering the first all-electric series production bowrider on the market.
Late last year, the company broke the world electric boat speed record at 109 MPH in a 100% electric boat in the
Lake of the Ozarks Shootout, the largest boating even of the year in North America. Now, it’s about to do it again, on a journey intended to “challenge the limits of what was thought possible” in the longest electric boat ride ever from Norfolk to Miami.
From there on, VMAR expects the wind to fill the sails with positive cash-flow by the end of next year and profitable and growing divisions by 2025.
