Issues, Interests, Institutions and Information

Issues

According to the case study there multiple and a wide variety of issues involved regarding Personal Watercraft (PWC). One of the issues was the potential for water contamination from the oily residue left in the water by two-stroke engines. In addition to the potential for water pollution, air pollution from emissions was also a concern. There was also another type of pollution that was being raised as an issue, “Noise Pollution”. Homeowners and other groups complained that the noise from PWC degraded the quality of the “natural experience” and was a potential distraction to wildlife. PWC safety was another area of major concern; published studies indicated that the accident rate for Jet Skis was significantly higher than regular motorboats.

Interests

There were many opposing interests identified in the case study. PWC manufacturers, such as Bombardier, Polaris, Kawasaki, and Yamaha, as well as, PWC buyers and/or potential buyers all had a vested interest in the outcome of the issues and conflicts. Associations such as the Personal Watercraft Industry Association (PWIA) which represented the Manufacturers, and various other associations which represented buyers and users were also key stakeholders.

The interests on the other side of the equation, who maintained a contrasting position to the PWC manufacturers and owners, were a multitude of conservation and environmental organizations. The opposition included conservation organizations such as, American Canoe Association, the National Parks and Conservation Association, the Earth Island Institute, as well as, environmental activist groups such as the Blue Water Network and the Earth Island Institute. Home owners and general environmental enthusiasts were also interested participants in the outcomes and resolutions.

Institutions

The case study study cites the involvement of many institutions such as the National Safety Transportation Board (NTSB), Environmental Protection Agency (EPA), California Air Resources Board (CARB), as well as other Federal, State and Local regulatory agencies. Although not specifically referenced in the case study; the news media and public sentiment were institutions of considerable influence on both sides of the issues.

Information

According to the case study, both proponents and opponents of PWC possessed a wealth of information regarding the issues. Much of the information provided and shared by those involved appeared to be unsupported, or at least the sources of the information were not revealed. A study published in the Journal of the American Medical Association indicated that 1995 approximately 12,000 people were treated in hospital emergency rooms due to injuries from jet skis. The industry responded by claiming that surveys suggested that PWC were used more frequently than boats and that the accident rate was similar to that of water skiing. This information may be accurate but the industry did not substantiate its claim.

The Bluewater Network has claimed that PWC are extremely polluting to air and water. They claim that two stroke engines discharge about one-third of its gas-oil mixture into the water unburned. The CARB reported that “a day’s ride on a 100 horse power Jet ski emits the same amount of smog-forming air pollution as driving 100,000 in a modern day passenger car” (Jet ski Position Paper, Bluewater Network, 1999). Two-stroke engines have been banned on motorcycles because of emissions. The industry has claimed that PWC two-cycle engines are no different than outboard two cycle engine’s found on motorboats and therefore do not have higher emissions. Furthermore the EPA claims that hydrocarbon exhaust emissions account for 3% of the nation’s total emissions. The industry claims that PWC make up only 9% of the recreational boats in the country, and therefore account for 0.3% of the total (Market Wire, March, 2000).

PWC opponents claim that the noise levels from PWC range from 85-102 decibels (dB) per unit, the American Hospital Association recommend hearing protection for exposure to 85 dB or above (Jet ski Position Paper, Bluewater Network, 1999). The industry claims that numerous studies and tests have demonstrated that PWC emit considerable less noise per unit than most recreational motorboats. Independent tests further demonstrate that the older-generation PWC (1998 and older), are often quieter than many boats on the water (Market Wire, March, 2000)

How have Jet Ski manufacturers used market and nonmarket strategies to address the issues they face?

Jet Ski manufacturers have taken several steps and introduced many non-market strategies to address the issues with PWC. The creation of the PWIA was a nonmarket strategy designed to address conflicts. The PWIA attempted to position itself as a champion to all interested and affected parties. The industry also took additional actions such as providing water safety rules and safe operating procedures of PWC on the PWIA website. The PWIA took an aggressive but risky action of developing and introducing legislation to make the waterways safer; this resulted in 26 states imposing regulations based on the legislation. This in itself was a good nonmarket strategy because the industry and PWIA took the first steps toward addressing the conflicts that activists and environmental groups had raised. The risk of not taking the initiative to introduce legislation could have resulted in more stringent or restrictive rules and regulations if someone other than the industry and had spearheaded the effort.

The industry took a series of steps to address noise issues as well. The installation of sound reduction technologies and the transition to four-stroke engines were a few of these steps. The newer generation PWC are 70% quieter than their predecessors (Boat/US Magazine, March 2006). Addressing the noise issues raised by activists and environment groups was a good nonmarket strategy that proved to be a good market strategy as well. By manufacturing PWC to be quieter, it opened up new markets for the PWC industry. As a result, the four-stroke PWC were Kawasaki’s best sellers in 2002 (Boat/US Magazine, March 2006).

The transition to four-stroke engines also resulted in a decrease in emissions as well. Emissions form the direct injected four-stroke engines are 60% to 70% less than the older generation two-stroke carbureted engines. (Boat/US Magazine, March 2006).

Some manufacturers also integrated market and nonmarket strategies when addressing safety concerns as well. Kawasaki added “off-throttle steering” which allows riders to maintain control of the vessel even when they have let off the gas. Sea Doo took a different approach to the problem but produced a similar result with their “Off Power Assisted Steering” (OPAS)” system. (Boat/US Magazine, March 2006).

Kill switches were also added to the newer models which shuts off the engine if a rider falls off their PWC. The features address not only safety concerns, but improves the maneuverability and functionality of PWC as well.

Another intelligent nonmarket strategy was loaning and encouraging the use of PWC to government agencies such as FEMA and the Department of Parks and Recreation. Government use of PWC could influence law makers and regulators favorably to PWC manufacturers. This strategy could open new markets as well as people see the different and potential uses of PWC.

Should Jet Ski Manufacturers join the National Marine Manufacturers Association?

The PWIA which represents the PWC industry is already associated with the National Marine Manufacturers Association (NMMA). The PWIA’s current association with NMMA keeps them at an arm’s length, but still provides them support and strength in numbers when issues or obstacles arise. Furthermore, PWC have enough uniqueness and are distinctly different than other types of watercraft both powered and unpowered. Because of the differences in PWC and the existing association with the NMMA that the PWIA currently enjoys, they should not join the NMMA.

Should the Jet Ski industry seek to be included in the same regulatory category as powerboats?

It would not be advantageous for the Jet Ski industry to be in the same regulatory category as powerboats. As mentioned previously, the uniqueness and differences in PWC are significant enough that the same laws and regulations for powerboats should not apply to PWC. The size, capability, engine types, design and the intended usage of PWC are different than those of powerboats. The existing laws and regulations that are in place for both powerboats and PWC are in the general public’s and the industry’s best interests. For example, many states have laws prohibiting the operation of PWC at night; this law does not and should not apply to boats. Some states are actually considering lowering the speed limit considerably for boats. This type regulation if applied to PWC, could negatively impact potential PWC buyers and erode market share for the PWC industry. In summary the Jet Ski industry should not seek to be included in the same regulatory category as power boats, but should maintain its own.

What non-market strategy should Bombardier adopt?

I believe that the non-market strategy that Bombardier has pursued is an effective one and appears to be working. Their website includes safe operating procedures for PWC as well as an actual PWC safety video that can actually be watched on line. They currently meet the CARB three star rating for ultra low emissions and boast about the fuel efficiency being 32% better than their competitors. Improved fuel efficiency integrates with its market strategy as well, the rising costs of fuel required to operate a PWC is an influential factor for potential buyers. Transitioning to four-stroke engines was another example of integrating market and non-market strategies. The reduction in noise levels no doubt satisfied some of the concerns of the activists and other interested parties, but also attracted new buyers who may have looking for a quieter running machine.

Bombardier and the Jet Ski industry as a whole has taken many steps toward designing and manufacturing PWC that are safer and more environmentally friendly. As a result, not only have they satisfied many of the concerns of the opposition but have developed a better and more marketable product.

References

Bluewater Network (1999, Revised 2002). JETSKI POSITION PAPER

Vatalaro, M (2006, March). This is not your father’s jet ski, Boat/US Magazine.