Hi, everyone. I'm Dave Foulkes, Brunswick's Chief Executive Officer, and I'd like to welcome you to our 2022 Investor Day event. Once again, we're using a virtual format to present this update on our rapid progress with the exciting NextWave strategy we shared in May 2021. As you'll see, we've made tremendous strides advancing every aspect of the NextWave strategy that builds on our foundation as the largest and most innovative company in the marine industry. Just a few weeks ago, we released our 2021 full year financial results, demonstrating almost 35% year-over-year growth on the top line, and more than 60% earnings per share growth.
We also guided to continued strong growth in 2022, and shared our target of achieving revenues of $10 billion by 2025. This presentation will review the progress we made powering up our Next Wave strategy in 2021, and describe the multiple paths for sustained future growth that, despite the disruption we're all experiencing, allows us to confidently project our 2025 goals. You know that we have a new and very dynamic leadership team, and you will see and hear from some of the key members today, including our division presidents, Chris Drees, Brenna Preisser, Brett Dibkey, and Áine Denari.
Our Chief Financial Officer, Ryan Gwillim, and our Chief Marketing Officer, Lauren Beckstedt. Before we begin the presentation, I'd like to remind everyone that our comments will include certain forward-looking statements about future results. Please keep in mind that our actual results could differ materially from these expectations. For details on the factors to consider, please refer to our recent SEC filings.
All these documents are available on our website at brunswick.com. During our presentation, we'll be referring to certain non-GAAP financial information. Reconciliations of GAAP to non-GAAP financial measures are provided in previously issued current reports on 8-K, all of which are available at brunswick.com. Next Wave is about combining our foundational strengths of scale and capability with investments in our core business, our ACES strategy, and our advancing digital capabilities to create not only the smartest products in the industry, but also the smartest, most desirable and engaging experiences delivered, for example, through Freedom Boat Club.
We believe we're the only company in the marine industry with the scope and scale to deliver such a transformational vision. When we introduced the Next Wave strategy in 2021, we articulated the vision and some of the early key performance indicators that would measure our progress. We were not yet ready to connect it directly to longer term financial projections. As you'll see, all our earlier KPIs are on track or ahead of plan, and in this update, we will more directly connect the components of Next Wave to our target of delivering revenues of $10 billion in 2025. In the first part of the presentation, I will recap some key components of Next Wave.
Then we'll review what we've done, particularly in the time since our May 2021 investor meeting, to power up the Next Wave strategy and set our course for 2025 and beyond. There are three main themes in Next Wave. The first involves actions we're taking to further enhance our extraordinary position of industry leadership. The second concerns investments we're making to ensure we continue to win in a rapidly changing world. The third is about accelerating full commercialization and financial contributions from our rapidly growing emerging value drivers.
I'll go deeper into these individual components later in the presentation, and the division presidents will explain how the priorities of their respective divisions align with delivering these components. Let's start with the theme of enhancing our existing position of leadership. The key components of this theme are advancing our current position of global product leadership, expanding capacity across our businesses to take advantage of elevated demand and market share gain, but in a smart way that focuses on strong return on investment and minimizes downside exposure, continuing to grow sources of annuity earnings across the enterprise, both in absolute terms and as a percentage of revenue and earnings, increasing the resiliency of our business with a particular focus on vertical integration and supply chain robustness.
As you'll have seen, we're making many investments to ensure we win in a rapidly changing world with evolving consumer, societal, and other stakeholder expectations. These investments are already yielding tremendous benefits. Our investments in deeper boater insight, for example, via our Ripple online community, are providing rich, real-time insights. These insights fuel consumer-centric innovation and our ability to create distinctive new products and experiences. We have all the tools to bring to life these distinctive new products and experiences in an accessible, intuitive way through our ability to deliver fully integrated, compatible, and holistic technical solutions to customers and end consumers.
These new products and experiences are being shared with potential consumers via our rapidly advancing suite of digital assets, from websites to apps, that allow customization and engage consumers further into the purchase funnel. We recognize the impact of our business and our products on the environment and have taken multiple actions to mitigate this impact through a coordinated sustainability strategy that is continuing to take major steps forward with meaningful concrete actions.
Our ability to attract and retain the best talent is benefiting from tremendous levels of investment in the richness and diversity of our culture, in addition to our comprehensive suite of employee benefits and programs. The final Next Wave theme or imperative is to accelerate the financial contribution of the emerging value drivers we've been very deliberately cultivating over the past three years. This includes rapidly scaling the Freedom Boat Club ecosystem, including our Boateka pre-owned boat online sales platform. Brenna Preisser will discuss that in more detail later, transitioning our ACES strategy development initiatives to full commercialization.
You've already begun to see that with our new connected solutions and generator replacements. The full transition will unfold over the next year. We'll continue to build out our portfolio of high-tech systems through strategic M&A and subsequent integration. Finally, we'll fully monetize the deep commercial, technical, operational, and business model synergies that we anticipated as we designed our go-forward operating model. I'm gonna spend a little time now unpacking those themes one more layer, starting with global product leadership.
As we deliver an expanded scope of services and experiences, we also know that there is no substitute for having the best designed, most advanced products embodying the most leading-edge technology. As you will see in the division presentations, we are fully committed to the investments that will maintain our businesses in that position of global product leadership. We have a packed funnel of new products that are bringing to life the technological synergies across our enterprise, including from our new acquisitions.
As you all know, the appeal of these industry-leading products is rapidly gaining us new OEM customers and end consumers, and we're working to capitalize on the potential for additional share gains. In addition to addressing backlogs and refilling the very depleted field pipelines by making some smart investments in additional production capacity across our businesses, we have focused our plant expansions and greenfield developments in areas with good existing labor availability, all which allow us to tap new labor pools. In addition, the expansions have a good cost base and are generally able to leverage existing plant infrastructure. When fully completed in 2023, these expansions will add more than 1 million sq ft of production footprint.
The topic of 2021 was, of course, supply chain issues, and we enter 2022 with continuing supply chain tightness and inflation. It's been noted, though, that Brunswick has been amongst the better performers in navigating this disruptive environment. We are not at all complacent about the situation, however, and we'll continue to execute our strategy of pursuing a combination of vertical integration and reinforcing our relationships with our best-in-class global supply chain partners. We'll continue to invest behind Mercury's already deep end-to-end integration, as well as leverage our scale and global reach to generate supply chain security and optionality. We will selectively insource into our existing facilities and via acquisitions where our scale enables us to make sense. You will hear examples of these actions from our division presidents.
I'd like to move on now to talk about some of the unique capabilities we've developed to win in a rapidly changing environment. The scale of our business and the investments we've made in digital assets and new technology furnishes with the opportunity for unparalleled engagement with the evolving boating community, allowing us to be more effective at attracting and retaining boaters. In particular, our broad portfolio of go-to-market brands, Freedom Boat Club, and our investments in connectivity and advanced digital assets provide a competitive advantage in allowing us to gain deep insight into the attitudes and behaviors of the evolving boating community.
Maintaining a real-time connection to our consumers has helped Brunswick lead the industry through this very dynamic environment. To share more about what we're seeing with the next-generation consumer, I want to introduce Lauren Beckstedt, Brunswick Chief Marketing Officer.
Brunswick is best positioned in the marine industry to meet the needs of the changing consumer through our wide-reaching portfolio, investments in research, analytics, and consumer insights, and rapidly accelerating digital customer experiences. Only Brunswick has access to such robust, real-time consumer feedback, and these insights are powering the NextWave. Our NextWave strategy continues to attract new participation into marine, and with that, increases in diversity. With more women, people of color, and boaters at earlier stages of their lives than in 2020. In 2020, a wave of first-time boaters entered into the category and fell in love with our brands.
Brands like Mercury, Lowrance, Sea Ray, Bayliner, and Freedom Boat Club, to name just a few of our 60+ brands. As we followed that next generation of boaters into their second season last year, 90% continue to rate their boating experience four or more stars. Most tell us that the new boater learning curve has gotten much easier in their second season. Next gen boating saw a lift from next gen workplace trends. Boaters took advantage of the increased workplace flexibility last year and expect to continue enjoying more weekday time on the water.
Today's boating enthusiasts rely on technology as vital, and Brunswick's commitment to smart products inside smart experiences make boating easier than ever before, even for beginners. Consumer commitment is strong. Most first-time boaters tell us they plan to stay committed to marine over time. This is not the boating of past nostalgia. This is the Next Wave, a wave of boating for all, where the consumer makes the difference, and we are listening to what they have to say.
We launched Ripple just over a year ago, and today it's a community of 4,000 boaters who help shape the future of recreational marine. They are the next generation of boaters who have diverse needs, demand innovation, connection to community, physical and digital experiences, and a connected ecosystem that only Brunswick can deliver to make boating easier than ever before. Let's once again hear from Dave as he expands on how we connect consumer insights to advancements in innovation.
Thank you, Lauren. Brunswick's real-time access to a broad set of marine and recreation enthusiasts breathes life into our innovation strategy, informing our designs, our technology advancements, and our new business models in a way that would be very difficult for others to replicate. This ability to access and act on unique consumer insights has been increasingly recognized over the last few years, not only within the global marine industry, but also across industries, as evidenced by our two recent Consumer Electronics Show innovation award wins.
We're investing in agile innovation assets like our i-Jet Lab at the University of Illinois, which has recently moved to a new facility with 3x the footprint and twice as many employees and interns. Brunswick is also making large investments in its digital capabilities and assets as the digital transformation takes hold in the marine industry. Digital capability is fundamental to a unified consumer experience across the marine landscape and is core to Brunswick's cross-business synergy strategy. Through our digital investments, we will move the customer along the path of maximum lifetime value via the most contemporary suite of digital assets in the industry.
We expect the proportion of digitally assisted sales across our enterprise to rise from 25% today to 50% or more by 2025. Our overall e-commerce sales from our brand dotcoms and apps to rise from around $160 million today to more than $400 million by 2025. Another capability that distinguishes Brunswick, and particularly our Advanced Systems Group, is our ability to offer completely integrated onboard and off-board technological solutions to our customers that deliver new technology in a way that's intuitive, compatible, efficient, and high quality.
Examples here are the Fathom e-Power onboard system that replaces internal combustion engine generators in boats and recreational vehicles with lithium-ion batteries and power management systems. Our CZone digital switching system, as deployed, for example, on the Harris Grand Mariner pontoon boat, that enables seamless onboard and off-board control of lighting, entertainment, and other systems. The recently launched connected app platform that supports the MyWhaler and Sea Ray+ connectivity solutions. These capabilities are enhanced by our recent acquisition of Seametronics, which manufactures the complex wiring systems needed to connect these systems.
As the largest and most capable company in the recreational marine industry, it's important that we also lead the industry in sustainability. Brunswick has demonstrated a long-standing commitment to sustainability with our Mercury Marine division achieving Green Master status for 11 years in a row. However, stakeholder expectations and our own aspirations are changing. We made significant progress in our sustainability program in 2021, measuring our enterprise emissions footprint across Scope 1, 2, and 3 and identifying decarbonization opportunities across our enterprise, some of which are already in flight.
We'll report on this work throughout 2022, including a report to the Carbon Disclosure Project, and we expect to be among the first in the marine industry to do so. An example of the decarbonization initiatives already in progress is the virtual power purchase agreement we signed in December with Vesper Energy. Under this agreement, beginning in 2024, the project will deliver 57 MW of new renewable energy to the North American power grid, equivalent to almost two-thirds of our 2021 global electricity consumption. Between this initiative and our expanded use of solar arrays across our footprint, we'll achieve scope two net zero emissions by 2035 and exceed our earlier goal to achieve 50% renewable energy by 2030.
We also continue to make investments to reduce the water consumed by our facilities. Our new stainless steel propeller manufacturing facility in Fond du Lac, Wisconsin, is yielding significant waste and water reductions, saving 4.5 million gallons of wastewater annually. On the product side, there are a number of recently introduced products and new products under development that will result in significant carbon emissions reductions. One currently in the market is the Fathom e-Power System I mentioned earlier, that replaces gasoline generator sets on both boats and RVs. We also have exciting new electric propulsion and boat products that Chris and Áine will discuss further. With the complex work of accurately estimating our carbon footprint completed, we've embedded decarbonization projects across our enterprise in our financial, business and new product plans.
We estimate that in 2022, approximately 15% of all our research and development spending will deliver positive sustainability impacts that support our strategy while also delivering other consumer benefits. Brunswick's significant and sustained investments in our people and our culture have positioned us as an employer of choice, not just in the marine industry, but across industries. Our position at number one in the manufacturing and engineering category of the Forbes list of America's best employers for 2021 caps a continuing series of awards as a best place to work for women, for diversity and for veterans, in addition to multiple other global awards and state and local recognition.
Our employee engagement survey results place us in the top 25% of manufacturing companies, with our employees particularly noting our sustained commitment to health and safety. Despite all the disruptions from COVID and the supply chain, the health and safety of our employees remains our top priority. In 2021, we achieved our lowest ever recordable incident rate. Our outstanding employees continue to win awards for their leadership, with more than 25 being recognized in 2021.
More than 40% of our U.S. talent is diverse, and we continue to make real advances with our diversity, equity and inclusion program, which is attracting strong participation throughout the company. Now let's turn to the third imperative in our Next Wave strategy. Over the past three years, we've expanded our business portfolio with new business models and technology strategies that we believe will be significant drivers of medium and long-term revenue and earnings growth and will increasingly fortify our competitive position. We think it's important now that we begin to share more fully the potential of these new businesses and product lines. Later in the presentation, Brenna will cover the exciting potential of the Freedom Boat Club and Boateka ecosystem, and the synergies with our core business. All of our business presidents will bring to life their respective parts in our ACES strategy.
I just want to spend a little time establishing a framework for our business synergies, providing an overview of ACES that bridges across the divisional elements, and also summarizing our recent M&A activity and how it supports our strategy. The synergies across our core businesses have always been clear. Our ability to sell Brunswick boats, which exclusively use Mercury Marine propulsion and also use many other Mercury and ASG systems, parts and accessories, provides valuable scale and compounded margins and feeds our long-term P&A annuity.
Brenna will explain later, the ability to sell more boats into the Freedom network and then exit them from Freedom via our Boateka pre-owned boat online sales platform, adds further layers of margin opportunity that we are only just beginning to exploit and that will become very material by 2025. Now let's move to ACES. We are rapidly transitioning our ACES technology development initiatives to full commercialization. You've already begun to see that with our new connected solutions and generator replacements. The full transition will begin to unfold quickly over the next year. By 2025, we expect to have more than 35 new ACE products across our enterprise, which will collectively represent significant contributions to revenue and earnings growth, some of which you'll hear about later.
In summary though, just in 2021 in the areas of autonomy and ADAS, we launched the DockSense Alert docking assist system on our Boston Whaler product, and of course acquired Navico with its industry-leading radar, sonar and display systems that will be critical enablers for our autonomy and ADAS systems going forward. In the area of connectivity, we made tremendous progress.
In June 2021, we launched the all-new connected boater platform that supports the new MyWhaler and Sea Ray+ apps. Late in 2021, Navico launched the newest version of its C-MAP navigation app that has 2 million downloads. As you know, we were very active in the area of electrification, installing 1,200 lithium-ion generator replacement systems in marine and recreational vehicle applications, unveiling the Mercury Avator electric outboard platform at the Miami Boat Show that Chris Drees will cover in more detail later, acquiring RELiON Battery and announcing our new high voltage technology center. Our acquisitions in 2021 were completely on target, focused on recurring revenue and advancing our ACES and shared access strategies.
The aggregate impact of the acquisitions was to add more than $500 million in anticipated 2022 revenue, more than 2,000 employees, and very importantly, a range of new and enhanced technology skills and capabilities. Our Next Wave strategy, along with favorable market and customer dynamics, is already driving accelerated revenue and earnings growth. In 2021, we delivered another record year that beat all expectations. As you know, we delivered $5.8 billion in revenue, a 35% increase over 2020, an EPS of $8.28, a more than 60% increase over 2020. Our businesses all experienced similar revenue growth rates and all contributed strongly to our earnings.
We estimate our recurring revenue from the combination of aftermarket sales of P&A and engines, in addition to Freedom Boat Club revenue, to be around 37% of our total revenue, and the associated earnings on these high margin businesses to be around 42% of our total earnings. We estimate our revenues from ACES related products and services, including Freedom Boat Club, direct sales and synergies, and our sales of advanced batteries, generator replacements, and connected solutions to have totaled around $175 million in 2021, some of which overlaps with our recurring revenue.
You've already seen that we have come out of the gate very quickly in 2022 with new products that represent more proof points for the facets of our Next Wave strategy, including ACES, consumer-centric innovation, the first exciting new products from our recent acquisitions, and the deep vertical integration we can now deliver. Our business presidents will review these new products and their strategic significance in detail. With these great new products and many other supportive conditions, we recently guided to further significant revenue and earnings growth and margin expansion across all our businesses in 2022. We will see an increasing contribution from our ACES products and services.
The powerful growth drivers we've established across our business units are powered up not just for short-term growth, but for sustainable growth well into the future, and in a way that continues to build the resilience of our business and protect us from future potential downside. Our propulsion business, Mercury Marine, is experiencing tremendous global share gains, installing significant new production capacity, expanding its already industry-leading distribution capacity and efficiency, quickly expanding its advanced controls product lines, and launching its first electric propulsion products. Our Advanced Systems Group is growing rapidly, both organically and via acquisitions, with an expanded systems portfolio and increasing share of wallet on every boat.
With integrated systems offerings that serve the marine industry and non-marine applications, such as recreational vehicles, with products in production and in development that will build its industry-leading position in electrification and autonomy, and with an active funnel of additional potential M&A targets. Our Boat Group is quickly and efficiently expanding its production capacity, both to meet continuing strong retail demand, to begin the multi-year process of field pipeline restocking, and to meet the rapidly increasing needs of Freedom Boat Club. It's also focused on implementing our expanded suite of ACES technologies and is committed to having fresh and vital product lines across all its brands to continue its success attracting new boaters. Finally, our Business Acceleration Division will continue to grow Freedom Boat Club locations, both domestically and internationally, organically and through acquisitions.
We'll scale the Boateka pre-owned boat sales platform to accept more and more boats exiting the Freedom network, in addition to piloting and scaling other businesses that are synergistic to the Freedom and Boateka ecosystem. By 2025, we anticipate these four powerful engines of growth combined will deliver approximately $10 billion in revenues and continued strong operating margin expansion, leading to anticipated earnings of $1.7 billion and EPS of $17. We also expect that by 2025, more than $1 billion of our gross revenues will be associated with ACES products and services. Despite the increased sales of boats and engines to boat OEMs afforded by capacity expansions, we will increase the proportion of recurring earnings to be in excess of 50%.
With these exciting goals in mind, let me now turn it over to our business presidents to take you in more detail through their respective growth stories, starting with Chris Drees, President, Mercury Marine.
Hello, I'm Chris Drees, President of Mercury Marine. Mercury's enjoyed incredible success over the past few years, allowing us to make substantial progress towards achieving our Next Wave goals. I'm excited for the opportunity to walk you through our strategic plan, beginning with our propulsion business. In 2021, we reinforced Mercury's standing as the leader in the marine industry by launching new innovative products, creating new tools and services for our customers, and making strategic investments in technology and manufacturing capacity. We look forward to continuing the record-setting momentum this year. New product innovations will continue to drive financial growth, generating more than $200 million in incremental revenue over the planning period as we expand our position within key markets. 2021 was an incredible year, starting with the amazing launch of the V12 600-horsepower Verado outboard.
The V12 launch built upon the success of the recent releases of our popular V6, V8, and Mercury Racing 450R outboards. The new V12 Verado showcases all of our capabilities in outboard design and engineering. It's the most advanced propulsion system we've ever created, earning Mercury a CES Innovation Award, Boating Industry Top Product, and Most Innovative Company at IBEX, to only name a few. We saw an immediate impact after the V12 launch. Many current and new OEM partners added the engine to their boat lines in 2021, with additional accounts expecting to receive product later this year once production ramp-up is complete. The popularity of the entire horsepower outboard lineup continues to strengthen Mercury's position in the industry.
Last year, we added 75 new OEM partners and achieved all-time high share at the Fort Lauderdale International Boat Show, where more than half of engines on display were from Mercury. Mercury's product leadership led to a record year in 2021, and we're not done yet. We're on pace to surpass our goal of 50% share in the U.S. and 35% share globally by 2025. The saltwater and repower segments represent key growth opportunities domestically. We're continuing to grow these important areas and our new product releases, coupled with new OEM partnerships, should accelerate this through the planning period. Globally, two-stroke product represents the bulk of the remaining share opportunity in underrepresented regions. We're well suited to capitalize on those opportunities as the eventual shift to four-stroke and electric propulsion will feed into our strengths.
Overall, demand continues to grow for Mercury products, especially in our high horsepower segment. We offer the broadest selection of high horsepower outboards in the industry, including horsepower nodes not offered by any other engine manufacturer. We also offer the most product differentiation with outboards engineered specifically for commercial, recreational, and performance applications. The MerCruiser product line remains strong as well. With recent launches, including the Bravo Four S drive, Mercury continues to deliver integrated systems to boaters who enjoy all types of on-water activities.
Our broad product portfolio puts Mercury in an unrivaled position of strength in the industry. We'll continue to drive growth through our existing and new channel partners as additional capacity comes online in Q4 of 2022. As we work through supply chain challenges in 2021, our vertical integration proved to be extremely important for minimizing constraints. In fact, production exceeded our original plans, even with significant supply chain headwinds. During the product development stage, we're able to design not only for performance, but for manufacturability as well. This gives Mercury exceptional control over quality, delivery, and cost throughout the product life cycle.
Our expertise and our recent investments in robotics, industrial Internet of Things, and next-generation technology allows us to continually improve and react quickly to evolving circumstances. The results are consistent year-over-year productivity gains. In the last three years, we've driven 540 basis points of productivity improvement. Our ability to ramp up and adjust production supports growth and margin enhancement throughout our business. We've also been recognized for excellence in manufacturing once again. Mercury received the 2021 North American Die Casting Association Award for Casting of the Year for the V12 engine block.
This is one of many awards our operation teams have received, highlighting one of our core strengths. Going forward, we're continuing to take a proactive approach to strengthening our business by investing in additional capacity. We've already begun expansions that will add more than 600,000 sq ft of combined space to our manufacturing and distribution facilities. Upgrades in Fond du Lac will increase capacity for 175-horsepower and higher outboards by 60%. All the facility upgrades will be fully operational in Q4 of 2022. Part of the reason we're winning share is our commitment to making boating easier and more enjoyable. We're accomplishing this through prop-to-helm solutions that seamlessly integrate our award-winning engines. In 2021, we unveiled a suite of next-generation digital throttle and shift controls that set a new standard for a premium driving experience.
Our design team enhanced the new DTS system with advanced ergonomics and a more intuitive user experience. We also integrated popular Mercury technologies, such as active trim, directly into the control. Future Mercury technologies will continue to make the boating experience come to life. We're working toward integrating autonomous functions and enhanced connectivity into our products to help boaters enjoy more confident control of their vessels. Already this year, you could see our commitment to make boating easier with two new product launches. First was a new Joystick Piloting for Outboards system designed specifically for pontoons powered by a single Mercury outboard.
Large pontoon boats represent a fast-growing segment of the market. We applied feedback from our dealers and OEM partners to create a fully integrated Mercury joystick system that makes it easier than ever to perform challenging tasks like docking pontoon boats in the wind or current. Previously, this level of control was only available on multi-engine boats. We followed up that launch with the new JPO with bow thruster system. It integrates popular bow thrusters with the Mercury joystick control to bring a high level of steering authority to boats in the 40-foot and larger class.
Our new joystick piloting systems will give boaters greater peace of mind when maneuvering their boats. The technology establishes a strong foundation for delivering a more autonomous solution to boaters in the future. On our path to delivering a better boating experience, we're expanding our efforts to connect with boaters and support them on and off the water. It starts with our dealer network. Nobody can duplicate the support we're able to offer.
With more than 7,000 servicing dealers and more than 28,000 technicians around the world, all working every day to help ensure boaters have a great Mercury product experience. To further elevate the service experience, we're leveraging our expansive network to customize service through multiple channels. For instance, the new Mercury Elite Service plan is an exclusive program that provides mobile service in select regions and technical support from anywhere in the world. Elite Service is currently available to V12 outboard owners with plans to expand to more owners in the future. This level of support will continue to differentiate Mercury from the competition. We also have more than 50,000 connected engines through the VesselView mobile app and more than 370,000 connected through other systems. We're well on our way to target of 1 million connected boaters.
The VesselView mobile app provides a rich connection that allows boaters to track engine data and even share this information with their preferred dealer. Regularly communicating with boaters through all our channels helps Mercury maximize customer lifetime value through post-purchase experiences and ultimately has allowed us to achieve a net promoter score of 70 points, an all-time high for Mercury and a strong foreshadower of repurchase intent. Better service leads to a better boat ownership experience. Combined with our industry-leading warranty rate of just 1.1%, this is how we'll create brand loyalty and ultimately win with consumers. In February, we made an exciting announcement at the Miami International Boat Show, where we shared the initial concept for the Mercury Avator electric outboard program. The Avator program addresses growing demand for electric outboards.
This is an evolving market, and as boaters continue to embrace advanced technologies like electrification, Mercury will be positioned to capitalize on new market opportunities. The Avator program also builds on Mercury's commitment to sustainability. We're on track to achieve an 80% reduction in outboard emissions by 2025. Avator will further our efforts by making boating possible with zero emissions. When you consider what's currently available on the market, it's clear that Mercury is entering this space with several major advantages over the competition. First is the Brunswick ecosystem. We're collaborating with ASG to produce the advanced battery systems needed for premium electrification. We also have the strength of our broad dealer network and distribution points to help us support consumers who transition to electric. There's our expertise.
We're the leaders in marine innovation with more than 80 years of experience in areas like hydrodynamics, propeller design, and integrated systems that will differentiate Mercury electric outboards from anything else available. This initial concept is only the beginning of what's to come from Mercury in this space. We will bring five new electric outboard products to the market by the end of 2023, and three additional electric outboards by the end of 2025. As we look to the future of electric mobility, the battery technology we're developing with ASG also has applications that extend well beyond the initial Avatar concept. Electrification represents the next step forward for Mercury, and we intend to be the marine industry leader in both traditional and electric propulsion within the planning cycle. Mercury is on an incredible pace with our Next Wave strategy.
Through sound execution across strategic pillars, we'll drive revenue growth and enhance margins to achieve our 2025 propulsion target. Ventures into electrification, autonomy, and connectivity will further reinforce our leadership in the industry as we continue to set the standard for marine propulsion. Now let's transition to parts and accessories. In 2021, Mercury experienced another year of strong sales growth across our P&A and distribution businesses. Through our Mercury and Quicksilver brands, the new ASG division, as well as Land & Sea and our other global distributors, we're able to support our customers with quality products from bow to stern while delivering some of the most advanced technologies in the marine space.
Just like in our propulsion business, innovation is helping Mercury win in P&A. The boating industry continues to enjoy record participation, with 93% of new boaters expecting to stay committed to boating over time. Our broad portfolio of products puts us in a strong position to capitalize on resulting demand. Our position is especially strong among Mercury engine owners, as Mercury is the sole provider for close to 60% of the parts in their engines. Through our various channels, we're able to supply DIY consumers around the world who want to maintain and upgrade their own boats.
We're supporting boat builders as they increase production to meet demand, and we're maximizing potential on new boat sales and after purchase sales at the dealer level by providing a wide range of lubricants, parts, batteries, accessories, and other items. Even as consumers begin to return to pre-pandemic activities, continued interest in boating and demand for propulsion products will fuel PNA growth. We're working towards additional enhancements to the business to facilitate this growth.
In order to strengthen our P&A business, we're focusing on expanding distribution access across locations and broader geographies, getting more product to dealers and consumers faster. The biggest investment we're making in this area in 2022 is a new centralized PNA distribution center in Indianapolis. At 500,000 sq ft, the new distribution center will serve as a major hub for supplying products to our partners across North America. It incorporates state-of-the-art technology and will help make distribution more efficient and cost-effective. We plan to have the new center online by Q4 of 2022. Globally, we're now supporting more than 27,000 customers with P&A products.
We anticipate additional growth as we expand our propulsion footprint in underrepresented regions over the next few years. Mercury is operating from a position of strength in our P&A and distribution business. Our investments in inventory throughout the pandemic have allowed Land & Sea to continue supplying customers with products they need. Thanks to effective inventory management, Land & Sea generated record sales in 2021, nearly doubling industry growth rates. It was also nominated for the best virtual trade show. E-commerce is another area of focus for our P&A business as more consumers shift to their preferences towards online purchasing. In 2021, we saw a 36% increase year-over-year in e-commerce sales.
We'll continue to grow e-commerce by leveraging high online sales and fulfilling dealer needs. The groundwork is already being laid through investments in new digital resources to enhance the e-commerce experience. By 2025, we intend to grow our e-commerce business to $110 million. This truly is an incredible time for Mercury. We continue to set records and find additional ways to set our brand apart from the competition while driving the industry forward through innovation. Our current strength and our investments set up Mercury for continued success in years to come. Now, ASG President Brett Dibkey will take you through the progress being made by the Advanced Systems Group.
Hello, my name is Brett Dibkey, and I am President of Brunswick's Advanced Systems Group, or ASG. 2021 was certainly a very exciting year for ASG. We delivered strong organic growth for the enterprise and also transformed our business through two key acquisitions. In Q3, we acquired RELiON, a leading lithium-ion battery provider, and in Q4, we acquired Navico, a marine electronics company with an outstanding portfolio of four winning consumer brands. These acquisitions, coupled with our own internal transformation journey, have put us in a strong position to capitalize on clear industry trends and deliver over index growth and value creation for Brunswick. We will achieve this by focusing on four key business priorities in 2022. First, we will integrate Navico to unlock the delivery of a fully integrated bow-to-stern platform for the marine industry.
Second, we will leverage our already strong market position and capabilities to accelerate a shift to electric power. Third, we will continue to accelerate growth in adjacent markets like RV and specialty vehicles where we have a strong presence and a clear right to win already. And finally, we will continue actively pursuing M&A targets that advance our strategies and create long-term sustained value for Brunswick. Let me now spend just a few minutes providing a little more detail on a few of these priorities. I'll start with the integration of Navico. Again, the Navico acquisition brought us an outstanding portfolio of legendary brands in the marine industry. Lowrance for inland and nearshore fishing, Simrad for offshore saltwater fishing and power boating, B&G for sailing, and C-MAP for marine cartography. In the first year of Brunswick ownership, Navico delivered outstanding financial results.
On a full year basis, 2021 revenues were up 35% to prior year, and bottom line earnings more than doubled. What's more, Navico's full year financial performance outpaced our mid-year valuation model. This is a trend we expect to continue in 2022 and beyond. While early financial performance has been terrific, the real game changer of the Navico acquisition is the strategic value it brings in enabling ASG to deliver truly seamless on and off-board experiences. Gone will be the days of choppy, fragmented experience at the helm. In its place, we will deliver a seamless contextual control and monitoring solution that is fully integrated with all major onboard systems, from propulsion to power management and all points in between. In summary, the Navico acquisition positions ASG to deliver integrated systems that meaningfully improve the boater experience in a way that no company in the world can.
While this level of integration represents a clear benefit for boaters, it also represents a step function improvement for OEM builders. ASG is now positioned as the only tier one supplier in the industry who can deliver a full suite of plug-and-play on and off-board systems. This will help our OEM customers keep pace with rapid advancements in technologies, reduce build times, improve quality, and deliver outstanding experiences to their end consumers. Underpinning this transformation is Navico's migration to an Android-based enterprise class operating system that we call Neon. Simrad is launching the first Neon multifunction display now, and other brands will follow shortly.
Neon enables more seamless integration with OEM partners and provides for much greater flexibility in delivering OEM-branded digital experiences. Neon also serves as a key foundational element for delivering our ACES strategy as it provides a platform for continuous improvement via over-the-air updates. The following short video provides a brief overview of our new Neon operating system.
For the last three years, we have worked on Navico's new operating system. It's the biggest technology project in Navico's history. Because we're across multiple time zones, the actual work that's been going on this product is 24 hours.
There's never a moment in the day where somebody isn't working on it. Customer expectations are changing a lot in our industry. There are new generations coming in, and they don't have these preoccupied opinions about what a boat should be. They just wanna have a very simple user interface. Taking it from something that was like learning to use an airplane, now to something that was much more familiar and intuitive, like what your TV or your phone or your car is like, 'cause this is what you use every day. We've literally gone through every last feature to the finest detail and redesigned it. Seamless connectivity, I think that's almost a given. What we've created is a bunch of services, and that allows us to upgrade and improve those services on that platform independently. That's allowing us to innovate faster in the future.
It's a simple experience, and boating just becomes easier and more pleasant. We are really now in a game-changing moment, and for me, very exciting to be part of this journey.
The Navico acquisition clearly filled a key gap in enabling our platform strategy. This strategy yields multiple sources of growth and value creation for Brunswick and its shareholders. Notably, it helps us increase share of wallet with OEM builders by providing fully integrated systems that work better together. It enables us to improve product performance and deliver new features via over-the-air updates. It allows contextual selling of parts, accessories, and services to end consumers. Let me shift gears now to talk about the work ASG is doing to accelerate our electrification business. It's important to note that we are operating from a position of strength.
In addition to the acquisition of RELiON in 2021, our Mastervolt business initiated development of marinized lithium-ion batteries to support Mercury's launch of low-horsepower electric motors later this year. Also, we recently began formation of a world-class high-voltage battery tech center that will help support migration to higher horsepower applications. Over time, we see a notable migration from internal combustion engines to electric powertrains. While the degree of this migration is still unclear, it will undeniably occur in some form. ASG is very well positioned to not only capitalize on, but to lead this shift.
Along with our partner, Mercury, no other company in the world is better equipped to deliver a fully integrated electric backbone that powers both propulsion and onboard systems. We are also uniquely positioned to ease boater migration to electric vessels by delivering an intuitive control and monitoring experience at the helm. Development of this fully integrated system is underway, and we are confident that its launch will accelerate adoption of electric-powered vessels. Finally, let me spend just a few minutes on adjacent growth opportunities outside the marine industry.
As I shared a year ago, more than 25% of ASG's standalone business comes from outside the marine industry, primarily from RV and specialty vehicle builders. This business experienced tremendous growth throughout 2021. Our OEM integration business, called ASG Connect, grew more than 2x faster with our non-marine customers, a 170% growth rate compared to a 70% growth rate in the marine business. This is a clear indication that there is a strong demand outside the marine industry that our products and our brands can service.
Most of our non-marine growth came from our CZone brand, supporting the migration from analog to digital switching, and from our Mastervolt brand, replacing internal combustion generators with lithium-ion battery power. Clearly, our existing brand portfolio already has a strong presence outside the marine industry with considerable headroom to continue aggressive growth. Marine is and will always be our center of gravity, but the capabilities that we have developed servicing this demanding industry make us well-suited to drive continued over-index growth in adjacent markets that share similar characteristics to Marine. While we have already started to experience this growth, we see much more opportunity ahead to capitalize on clear trends in RV and specialty vehicle markets and also in power sports and industrial applications.
ASG's unique capabilities in power management, digital infrastructure, and user experience put us in position to drive growth across multiple industries and deliver significant value creation for Brunswick. As I wrap up, I wanted to leave you with a few key messages. In our short two years of existence, ASG has grown considerably. We are a significant source of high-margin revenues for the enterprise, and the best is yet to come. In fact, we're just getting started. We are exceptionally well-positioned to capitalize on clear market trends and deliver sizable growth and value creation. Between now and 2025, we expect the compounded annual growth rate of organic sales to exceed 12%, and we will continue to actively and aggressively pursue inorganic growth opportunities that drive further growth and advance our strategy.
With that, I'd like to turn things over to Áine Denari to talk about some of the exciting developments in the Brunswick Boat Group.
Hello, my name is Áine Denari, and I'm President of Brunswick Boat Group. I am delighted to be here with you today on behalf of the Boat Group to share with you some of our outstanding achievements from the past year and our great plans as we look forward. Let's start with some of our great accomplishments from 2021, which was a very successful year despite the dynamic external conditions, including continued supply chain disruption, cost inflation, and labor constraint. As boating continued to boom, consumer demand remained robust, dealer sentiment remained positive, and pipeline inventory levels reached record lows. We grew revenue by over $400 million, delivering a 35% increase versus prior year. We delivered a very strong 310 basis point operating margin improvement to exceed 9%, with seven of our brands exceeding 10% for the year.
We increased our investments in manufacturing and successfully delivered 3,000 incremental units of production output while expanding our manufacturing footprint in 5 locations. We launched 90 new boat products across our brands and segments, designed and developed by our world-class teams across our tech centers. We also launched numerous connectivity apps, and we currently have more than 5,000 consumers connected. Our great new products were recognized for their innovative impact with more than 20 top industry awards globally during the year. As we look forward, the future continues to be bright for the Boat segment. Throughout the Next Wave, we will deliver industry-leading growth with a healthy 14% CAGR as we focus on increasing production of our industry-leading products to satisfy retail demand and rebuild dealer inventories.
In fact, by 2025, we will have increased our production output capacity to 50,000 units annually across our 17 boat brands. We will do this with robust margins, achieving a double-digit operating margin for the first time in Boat Group's history in 2022, and increasing our margin by 350 basis points by 2025. Underpinning our confidence is a continued healthy marine market. We continue to be in an environment of unprecedented consumer demand, strong macroeconomic fundamentals, and dealer inventory levels at an all-time low. Of note, we closed out 2021 with a historically low 15.4 weeks on hand, indicating a healthy growth outlook as we replenish pipelines in the upcoming years. Boat Group's foundation positions us well to capitalize on this strong market demand for the next several years and also for the long term.
In the near term, we are able to leverage our size and scale, including our recent capacity expansions and our strong partnerships with our sister divisions, to be able to deliver more boats in this current supply chain constrained environment. Second, we have significant upside for the next several years as we replenish the depleted retail pipelines across all brands and geographies from their current record low levels. Third, we are well-positioned to sustain our market share gains as a result of our deep consumer engagement, which enables us to attract and retain our consumers long term. Fourth, we have the long-term sustained demand from our sister division, Freedom Boat Club, which we project to be our largest customer on a unit basis by 2025.
Boat Group's success in delivering on our Next Wave strategy is based on three key pillars, which we introduced last year in our Next Wave strategy and which we continue to believe are unrivaled in the recreational marine space. The first is delivering an elevated and frictionless consumer experience throughout the life cycle in order to ensure that we attract and retain boat owners for the duration of their lives. The second is our commitment to operational excellence, including manufacturing, quality, and supply chain, tools, processes, and footprint. This is key to unlocking our margin potential.
Third is an unrivaled portfolio of innovative market-leading products and technologies. We have the broadest portfolio of industry-leading products across our 17 iconic boat brands with the No. one market share position in most major segments. We continue to outinvest the industry in ACES and innovation to revolutionize our customers' boating experiences. Speaking to elevated consumer experience, for the past several years, we have invested heavily in improving all our consumers' physical and digital interactions throughout the life cycle. We are delivering an elevated contemporary consumer purchase experience in several ways.
We are augmenting lead generation and consumer engagement. For example, our capabilities in computer-generated imagery has resulted in an increase in digitally assisted revenue of 35% in 2021 versus prior year. We are regularly rolling out new digital tools and platforms. To date, we have completed modernization of eight major brand websites. We are launching industry-leading immersive shopping experiences, including digital product launches, configurators, and virtual tours. We have successfully conducted virtual boat shows for many of our brands over the past two years since the pandemic began.
These continue to generate leads and sales at rates that are comparable with in-person shows and are a format that we will continue to expand with our dealer partners. Additionally, we are working closely with our dealers to improve the physical purchase experience at dealers' locations through enhanced sales and product training for our dealers. We are also improving the ongoing ownership experience in ways that we can uniquely deliver considering our scale and resources. We have delivered community engagement platforms and connectivity apps such as MyWhaler and Sea Ray+, and we will continue to build out similar apps for additional brands as well as continuing to enhance functionality.
We are also continuing to invest in a best-in-class service experience through enhanced service education and training for our dealers, through offering elite service programs together with our dealer partners, and developing tools to increase efficiency of back-end processes, such as apps for electronic parts ordering and boat delivery inspection. Combined, these platforms, tools, and engagement forums are delivering a deeper and more frictionless consumer ownership experience throughout our consumers' life cycle. Moving to our second strategic pillar, operational excellence.
The continued strength of our world-class operations, quality, and supply chain teams is key to unlocking margin improvements across the Boat Group. Our unmatched scale positions us uniquely to benefit from these improvements across our 13 manufacturing facilities globally. We are vertically integrating over 30 product lines across our facilities to enable us to optimize logistics efficiencies and minimize supply chain disruptions. We are accelerating adoption of advanced manufacturing to drive up efficiency, reduce reliance on labor, and bolster quality across our portfolio. We have already seen tremendous benefits from automation improvements such as robotic riveting, welding, powder paint systems, and gel coat machines, and we are continuing to invest.
The comprehensive quality management systems that we are implementing across all our facilities span the entire scope, including design, manufacturing, and supplier quality management. We forecast that this will lead to a 25% reduction in warranty costs in addition to delivering a superior consumer experience. We also continue to increase production output during this time of unprecedented demand. I'm delighted to tell you that we will have expanded our production output capacity by 42% by 2025.
We already have significant footprint expansions underway or recently completed in seven of our 13 locations, which will deliver an incremental 500,000 sq ft of manufacturing footprint. In combination with these footprint expansions, plant optimizations, efficiency improvements, and incremental shifts are leading us to a total production output capacity increase, enabling us to deliver the increased demand. This growth also positions us to be the majority supplier of boats to our sister division, Freedom Boat Club, on an ongoing basis. We are also proud to be a leader in sustainable manufacturing in the industry.
Two years ago, Boat Group became the first OEM to have a facility earn the zero waste to landfill distinction, and we will have earned that distinction in all of our aluminum boat manufacturing facilities by 2025. We are also committed to the use of alternative energy in several of our facilities. In the product development space, our teams are designing our boats to reduce the environmental impact during manufacturing, use, and end-of-life stages. This includes the use of closed molding processes, material substitutions to recyclable materials, and lightweight, streamlined hull designs.
Moving to the third pillar, product and technology leadership. Designing, developing, and producing best-in-class products is the linchpin of our leading position in the industry. In the past year, we launched 19 new products across our 17 brands, including our new Heyday H22, Sea Ray Sundancer 370, Lund Renegade, Harris Grand Mariner with single engine joystick, and the fully integrated Boston Whaler 360 Outrage. I am delighted to tell you that we have many more exciting new launches coming up.
In fact, through 2025, we will launch over 75 key new or major redesigns, and we will be integrating over 25 advanced autonomy, connectivity, and electrification applications. How will we do this? By leveraging our world-class tech centers, which are staffed by our industry-leading experts in boat design, consumer insights, advanced materials, electronics, ACES technology, and systems integration. The Boat Group provides the platform to deliver differentiated end-to-end systems in partnership with our sister divisions.
To highlight some of the latest and greatest ACES technology integrations, let's take a closer look at the brand-new Boston Whaler 360 Outrage, which delivers an enhanced consumer experience both on and off the water. First are the Mercury V12 outboards that come with Joystick Piloting technology and which allows the captain to dock and pilot the vessel safely and with total confidence. While on board, passengers can utilize the vessel's Fathom e-Power system, which is an eco-friendly alternative to fuel-powered generators. It provides efficient, sustained green electricity to power all of the boat's appliances with an intuitive interface that simplifies operation.
The captain is also aided by some of the best electronics and technologies in the marine space. This vessel is outfitted with Simrad marine electronics and CZone digital switching capabilities that will give the captain the confidence to know the boat is set up and functioning correctly. We also offer the MyWhaler app to enhance the off-water experience, allowing the captain to remotely connect to their boat, perform diagnostics, and plan upcoming trips. Considering autonomy, we have a clear vision for where autonomous solutions will augment capabilities and give consumers confidence in executing difficult tasks and moving toward a world where the boat assists and ultimately executes specific tasks.
This starts with providing information about the boat and its surrounding environment through intelligently connected systems. It moves towards advanced pilot systems and ultimately to fully autonomous solutions. A great example was our recent launch of the Boston Whaler 380 Realm with DockSense, which we showcased at last October's Fort Lauderdale Boat Show. In the coming years, you will continue to see us expand our autonomous offerings, leveraging the solutions we are developing in water plane estimation, object detection and classification, and object tracking.
To enable a connected future, we will build on the connected apps we launched in 2021 to enhance our smart products in delivering smart experiences. Our recent connected app launches well exceeded our expectations in terms of activations and engagement. We are now expanding the suite of functions and rolling the apps out across additional brands, including features such as trip planning and reliving, consumer boat management tools like service log, remote diagnostics and account management, predictive maintenance, and additional community and network building functions.
From an electrification standpoint, in addition to our advanced onboard power management systems, we are working closely with our sister divisions of Mercury and ASG to deliver industry-leading, fully comprehensive electric propulsion boat applications. By 2023, we will have launched four boat applications with electric propulsion systems and will continue to deliver more boats with increasing horsepower and industry-leading fully integrated concepts over the next several years. I will be excited to be able to share more details about these exciting new launches very soon.
In closing, I am honored to have shared some of the highlights of Boat Group's future accomplishments and strategy with you here today. Let me reiterate that Boat Group is an integral part of Brunswick's coherent and winning marine strategy, leveraging our 17 industry-leading brands to connect the enterprise to our 1.5 million boat owners and giving us the platform to integrate our ACES technologies together with our sister divisions. We are confident in our ability to grow our business at a 14% CAGR with robust double-digit operating margins, which we will do by cultivating exceptional consumer experiences, launching world-class technology-leading products across our brands and segments, and delivering optimized operational excellence. There is no better time for Boat Group, and I remain very excited to be part of this journey. Thank you.
Now I would like to turn it over to Brenna Preisser, President of Business Acceleration.
Since 2019 when Business Acceleration was formed, we have truly been on an accelerated journey, and we are not slowing down. My name is Brenna Preisser, and I am pleased to share our Next Wave strategy. The core purpose of Business Acceleration is to expand boating participation, and in this pursuit, we are opening new growth laneways and accessing direct-to-consumer value pools. With Brunswick's scale in the industry, increasing boating participation creates long-term sustained value. We are also amplifying synergies across the portfolio through our ACES strategy, which I'll highlight later throughout the presentation.
Across the broader category of marine services and new business models, there is a large addressable market. Through our efforts over the past several years, not only are we in position to capture value, but our team is shaping consumer-oriented market with contemporary technology and business models that elevate the consumer experience. Expanding boating participation is not just something that we aspire to do, it is what Business Acceleration is doing. People love the water, and they love boating. Through contemporary business models and digital platforms, we are making boating even more accessible. This will generate meaningful synergies over time.
Not only are we creating financial value, but as I will share, we are building a highly interrelated business system that provides leverage over business outcomes. The essence of our Next Wave strategy is a large, enthusiastic base of participants. There are over 140 million annual boating participants in the largest marine markets. Not only do we have the largest network for club access in the U.S. through Freedom Boat Club to engage these boaters, but we are also expanding in Europe and building a broad platform of options to get people on the water.
Our goal is to win with boaters over their lifetime, to connect with them early and keep them on the water however they choose to participate, such as exploring the industry through BoatClass, an on-water training program launched in 2021, or through the core of our platform, Freedom Boat Club, in which members pay an joining fee and monthly subscription for access to a fleet of boats and concierge service, or through ownership with pre-owned boats sold through Boateka in addition to Brunswick's broad portfolio of new boat offerings.
This platform, Boating-as-a-Service, is differentiated by leveraging the full power of our enterprise, our brands, partnerships, digital assets, and unique insights to provide superior options for consumers. This is why Business Acceleration is a driving force behind long-term industry expansion with evidence of our progress. We are engaging younger boaters, diverse boaters, and enabling more women to take the helm. It is not just about attracting new participants. With the largest aftermarket PNA business in the industry, participation in boating is a key driver of value. In a 2021 study on boater retention, 43% of boaters planning to sell their boats said that they would consider joining a boat club, which means we still have a phenomenal wave to ride with the large baby boomer demographic.
Of those considering canceling their membership in this particular study, 19% would consider buying a boat. The marine consumer values optionality, and we provide options within a platformed experience. Earlier, I shared that we are building a highly interrelated business system that provides leverage over the business outcomes. We forecast there will be approximately 8,000 boats in the Freedom Fleet in 2025 throughout our company-operated locations and the franchise network.
Most of these boats will be powered by Mercury and represent Brunswick brands or key Mercury OEM partners. Over a four-year time period, each boat sold into our network, which means it is used by Freedom members, refurbished by Boateka, and sold as a pre-owned boat with a warranty to provide customers peace of mind. This boat will generate three-five x the profit of a single dealer transaction. Retail transactions and the dealer network remain very important to Brunswick and our brand strength. This model is additive, another tool for value creation. It is an amplification of synergies. Let me share more about what Freedom has achieved since our acquisition in May of 2019.
With the incredible partnership of our franchise network, we have added 10,000 net new memberships per year, nearly double the number of our locations, including expansion in Europe, and created meaningful synergy value. The revenue streams we have created are ongoing and subscription-based. By 2025, we will be one of Boat Group's largest single customers. The business continues to have momentum. In 2021, six acquisitions were completed that will enable Freedom to build from an established footprint in tier one growth-oriented markets and capture more value from this high-growth, profitable business model. In addition, with the existing company-operated footprint, super territories are being established for enhanced leverage.
We are powered up to meet the growing demand. With an established footprint and talented franchise network committed to growing Freedom Boat Club, we will be expanding our presence in existing markets and entering new markets. We believe this boat club model has sufficient runway for growth. We are confident in our success because Freedom is differentiated through our scale, our incredible network of employees and partners, and reciprocal access benefits, meaning any Freedom member can access any one of our 330 locations. As a division of Brunswick, we can provide our members value-added services such as connecting them with a new or pre-owned boat if they exit the club.
Brunswick also ranks in the top quartile for employee engagement and as a franchisor. We also strive to be the best partner for our marina operators, enhancing their profit. Freedom drives more foot traffic, increased fuel sales, and service revenue for marinas. Transitioning to Boateka, we are now incubating a new growth platform to support a healthy ecosystem of fleet management for Freedom, to engage new boaters and participate in an important part of the marine market with over 1 million annual pre-owned transactions.
Our Boateka team is building a differentiated model through unique access to boats through Freedom, value-added refurbishment that builds customer confidence, and a direct-to-consumer digital platform and boater services such as Brunswick's financing and insurance. Over the past 18 months, we have successfully transacted directly with consumers and refined our operating processes in preparation for our first independent sales and refurbishment center launch in Q2 of this year. We look forward to sharing more as this business develops. As Dave highlighted, business acceleration plays an important role in our ACE strategy.
This summer, Freedom will release a new reservation system and mobile app for Freedom members, which is built from the same digital platform that powers our enterprise connectivity solutions. With the largest community of boat owners and club members on a common digital platform, we can activate digital products at scale, such as our Blue Rewards program in which members can access products, services, and build loyalty points. Business Acceleration will also assist in activating Brunswick's electrification strategy and commercialization plans with unique consumer insights and over 500 potential points of distribution on the water by 2025. In closing, we are energized by the opportunity to catalyze a new wave of boating participation.
Business Acceleration is a force of innovation. We will generate high quality and high growth revenue streams, and we amplify the best attributes of the Brunswick portfolio. Thank you for your time. Now, let's send it to our Chief Financial Officer, Ryan Gwillim.
Hello, everyone. My name is Ryan Gwillim, Brunswick's CFO. For the last 90 minutes or so, you have listened to Brunswick's leaders share their powered-up Next Wave of strategic plans. For the next 10 minutes, I hope to accomplish two things. First, provide you with the anticipated financial outcomes from a successful execution of this four-year strategic plan. Second, and probably more important, reiterate Dave's earlier commentary on why Brunswick remains one of the best investment options in the consumer discretionary universe. Let's start by reviewing the core investment considerations for Brunswick or, put another way, what sets us apart from other investment options?
We operate in a healthy marine market, which has seen an acceleration of new boaters together with increased boating participation that continues to be enabled by more flexible work and lifestyles. Brunswick has capitalized on this market health through world-class operations and by leveraging our industry-leading product lineup to grow market share across our businesses. The result is top line and earnings strength and durability led by our growing recurring annuity-based businesses, which will comprise more than 50% of our earnings by the end of this plan.
We're confident that these attributes will continue to drive robust free cash flow generation and sector-leading total shareholder returns. Our 2025 plan contemplates the same consistent revenue and earnings growth that Brunswick has delivered in recent strategic plans. We anticipate an average of at least 15% revenue growth each year throughout the plan, with a four-year EPS CAGR of approximately 20%. Organic growth in each of our business units is responsible for the majority of the growth throughout the plan, with capital strategy plans, including M&A, adding 5% and 4% to top line and EPS CAGRs, respectively.
Lastly, the expected free cash flow conversion of at least 75% for the plan will fund our planned growth initiatives and leave significant cash for continued shareholder returns. As with past plans, each business continues to play a critical role in our success, with significant top-line growth being accompanied by margin expansion throughout the plan in every reporting segment. The propulsion business is expanding its output capacity, enabling it to leverage the strongest and freshest product lineup in the industry to increase its OEM customer base, supply more product to international and dealer channels, and grow market share.
In the P&A segment, increased boating participation and widening product breadth, including the addition of Navico and other technology assets into the portfolio, are increasing the reach of ASG's growing system solutions business while still being stabilized by the recurring aftermarket majority of the business. Lastly, the boat business remains focused on increasing production to satisfy retail demand and refill dealer inventories, attracting and retaining a younger and more diverse consumer, and increasing operating margins across all brands. Moving to capital strategy, our core tenets have not changed materially from recent strategic plans. Our capital strategy begins with critical spending on capacity, new products, and technology to further our market-leading position in our organic businesses and to grow our ACES and other strategic objectives.
Capacity expansions across all our businesses will continue during the early portions of the plan horizon with our businesses making smart bets to efficiently increase output without adding unnecessary fixed costs into the system. New product spending will remain consistent throughout the plan as we continue to lead with the most innovative products in the industry. Consistent cash generation should enable us to retain the strong financial position that we've worked so hard to achieve with a very healthy balance sheet, creating flexibility on the methods and levels of capital returns.
We plan to be active in M&A, and our priorities have not changed. We are focused on spending at least $100 million per year on bolt-on acquisitions, primarily in our P&A and Freedom Boat Club businesses, along with finding opportunities to further our ACES initiatives. In addition, we anticipate using our healthy cash generation and balance sheet to fund larger deals in these same businesses should opportunities arise.
Throughout this strategic plan, almost two-thirds of our planned capital spend is earmarked for growth investments, with the remainder of the capital allocation being returned to shareholders or repaying debt obligations. Capital expenditure levels will be elevated in 2022 while settling down to historical levels of 4%-4.5% of sales for the remainder of the plan. R&D will continue to trend higher as we elevate spending in ACES initiatives and increase the proportion of technology assets in our portfolio.
When it comes to shareholder returns and debt reduction, many of you have heard us say over the years that we maintain a balanced approach to returning capital to shareholders. While balance remains important, we believe that creating flexibility may be more important in the coming years, enabling our capital strategy to modulate depending on macroeconomic conditions and market performance. As an example, we have successfully managed our debt load with current gross leverage around 1.5 times expected 2022 EBITDA. Therefore, we have no immediate debt servicing needs but have increased flexibility to restructure our debt portfolio starting in the back half of this year and into 2023.
On dividends, we remain committed to increasing dividends on an annual basis as our earnings power grows, with the goal of keeping dividends stable in any economic environment. Our 2022 dividend of $1.46 per share is approximately a 14% payout, which although is lower than our historical target, still represents a 9% increase over the prior year. Finally, share repurchases will continue to play a material role in our shareholder return profile as our share price is trading at an unrepresentative low multiple despite our extremely favorable outlook.
Although we plan to be systematically in the market at most times through 10b5-1 plans, we foresee being more aggressive in times when conditions dictate as we have sufficient authorization to complete material buybacks in a short period of time. In speaking with investors over the years, a constant subject that inevitably gets raised is what happens to Brunswick's earning power in the event the economy slows. Well, I think you've heard today that we have increasing swim lanes of profitability that are not directly tied to the fluctuations in the macroeconomy, but we thought it was time to share our assumptions on how Brunswick would perform in a downturn.
Now, we fully admit that your assumptions on the economy, marine market, and potential impacts may be different from ours, but the bottom line is that we believe you'll have difficulty finding a reasonable scenario where our earnings drops back to $6 a share, which as you know, is ahead of our 2020 performance. We think that there are a small handful of assumptions that you can toggle in order to come up with your downside scenario. Although not the most material to our earnings portfolio, we'll start by assuming a material drop in the retail boat market and a view on resulting pipelines.
We have assumed weeks on hand of 30 weeks, which is less than the historic 35 weeks on hand, with wholesale sales performing slightly better than the retail market decline, as we're in a pipeline refill environment still for several years, and our boat group has other channels to sell into today, namely Freedom Boat Club, which should drive more steady demand. We'll then also assume two factors that we saw in the 2008 Great Recession. First, that propulsion unit sales remain more resilient than new boat sales, primarily due to repower sales increasing as a percentage of sales as people may defer a new boat purchase, yet repower their current boat with a new engine.
Second, that P&A sales declines are moderate, with OEM sales matching propulsion declines and aftermarket sales decreasing modestly as consumers continue to use their existing product at a time when travel or other alternative leisure activities may slow. Our cost structure remains a critical advantage for Brunswick and would provide opportunity in times of uncertainty. Following the 2008 financial crisis, we substantially lowered our fixed cost base, which we have continued to manage prudently over the last 10 years. We have also elevated our variable margins through a series of successful new product investments and operational excellence initiatives. Our current fixed cost base approximates $1.25 billion measured on an annual run rate basis or $300 million per quarter.
It also assumes a healthy level of R&D spending of approximately $200 million and slightly elevated SG&A to fund necessary projects in sales and marketing, IT, and other areas. Given our variable margins in the mid-30s%, this cost structure positions our run rate break-even point at approximately $3.5 billion-$3.7 billion of sales or approximately 50% decline from anticipated 2022 levels. This is obviously an unrealistic scenario in any perceived economic environment, but it emphasizes the point of how resilient our cost structure has become. Where does this leave us? Here we are showing two possible scenarios just as examples of how our thinking works.
To be very clear, we do not believe either of these situations are imminent in the near term, but we understand these will help the investor community realize how challenging their assumptions need to be to see a significant drop in EPS. To go from our current 2022 guidance down to EPS of $8, you would have to assume that the retail market goes down 30%, meaning approximately 145,000 boats are sold in the U.S. You would need to assume that propulsion sales decrease 15% and that P&A sales drop on average by high single-digit %.
To get to a $6 EPS, you would have to believe that the retail market goes down 40%, meaning approximately 120,000 boats are sold in the U.S., which is fewer than the number of boats sold in 2009 at the depths of the Great Recession. You would need to assume that propulsion sales drop 25% and that P&A sales drop mid-teens%, which is worse than the P&A business performed in any economic downturn. In both scenarios, only modest cost takeout measures are required to maintain these EPS levels. Hopefully, this exercise has helped reinforce our internal view that our sales and earnings are more resolute and durable today than at any time in our history, and that our earnings floor has indeed been raised.
Finally, I'd like to end by taking both a retrospective and forward-looking view of our total shareholder returns and earnings power. Since July 1st, 2019, which is when we became a marine-only powerhouse, our TSR of 128% significantly exceeds our peer average and our relevant indices. This is further proof that our simplified, focused investor narrative, together with substantial growth opportunities, provides investors with what we believe to be the best investment opportunity in the leisure or consumer discretionary space. As we project out to the end of this powered-up Next Wave strategic plan, our operating performance and capital strategy plan should deliver exceptional growth.
With the core businesses providing mid-teens annual EBIT growth and capital strategy benefits, including M&A, adding another 4%-5% of growth each year, we are generating strong, durable earnings that we believe will convert to shareholder returns that are accretive to the overall market. Thank you for listening to the financial outlook portion of the presentation, and I'll pass it back to Dave for a wrap-up.
Now you've heard our powerful growth story in detail, and you may have heard more facts and goals than you can easily remember. I thought I would close with some of the more important 2025 targets. First, we expect Mercury's U.S. outboard market share to be in excess of 50%. We anticipate our parts and accessories segment to have sales exceeding $3.25 billion. We expect to expand our boat segment operating margins by a further 350 basis points over 2021. We expect Freedom Boat Club to have around 575 global locations, and we expect to be in the market with more than 35 ACE products.
We've enjoyed this opportunity to share with you another evolution of our Next Wave strategy and to provide more detail on the sustained long-term growth potential of our unique, powerful, and resilient business platform. On behalf of the Brunswick team, thank you for listening and for being part of our journey. Bye for now.
Good afternoon, and welcome to Brunswick Corporation's 2022 Investor Day Q&A follow-up conference call. All participants will be in a listen-only mode until the question-and-answer period. Today's meeting will be recorded. If you have any objections, you may disconnect at this time. I would now like to introduce Brent Dahl, Vice President of Investor Relations.
Hello, and thank you for joining us for today's 2022 Investor Day event Q&A follow-up session. Before we begin the discussion, I would like to remind everyone that our comments will include certain forward-looking statements about future results. Please keep in mind that our actual results could differ materially from these expectations. For details on the factors to consider, please refer to our recent SEC filings. All of these documents are available on our website at brunswick.com. Additionally, during today's discussion, we may refer to certain non-GAAP financial information. Reconciliations of GAAP to non-GAAP financial measures are provided in our previously issued current reports on 8-K, all of which are available at brunswick.com. I will now turn the call over to our CEO, Dave Foulkes, for some opening comments. Dave?
Hi, everyone, and welcome to our 2022 Investor Day Q&A event. We hope you enjoyed the Investor Day materials, which were made available a week ago and is still available at brunswick.com. The presenters you saw and heard in the videos are joining me today, including our CFO, Ryan Gwillim, our CMO, Lauren Beckstedt, and our division presidents, Chris Drees, Brett Dibkey, Áine Denari, and Brenna Preisser. Next Wave is about combining our foundational strengths of scale and capability with investments in our core business, our ACES strategy, and our advancing digital capabilities to generate multiple long-term sustainable growth vectors for our business.
When we introduced the Next Wave strategy in 2021, we articulated the vision and some of the early key performance indicators that would measure our progress, and all these KPIs are on track or ahead of plan. In our latest presentation, we much more directly connected the components of Next Wave to our target of delivering revenues of $10 billion in 2025. We're looking forward to your questions. With that, Melissa, let's open the line.
Thank you. At this time, we'll be conducting the question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from the line of Kevin Heenan with JP Morgan. Please proceed with your question.
Hey, guys. Thanks for taking my question. I guess just to start high level, how would you characterize the health of the consumer today? You know, are you seeing any impact? You know, from higher gas prices, or changes to the demand environment, and any, you know, change in the way you see 2022 retail unit demand at low singles. Thanks.
Thanks, Kevin. Thanks for the question, Kevin. I think I would separate maybe some of the emerging pressures on the consumer in general, which you articulated from our current experience of retail and wholesale demand. We're continuing to see intact retail and wholesale demand. We of course recognize that some things are changing directionally in a way that might impact us at some point in the future. We have our antenna up on that. It's just a little early for us to say. If you look back in history, though, and I mentioned this in some recent meetings and events, we see effectively no correlation between gas prices and either our P&A business or new boat sales. There isn't a historic trend. Of course, it is possible that the gas prices will go out of historical range.
If that happens, it's possible that there'll be an impact. History at the moment tells us that they would really need to go significantly out of historical ranges for it to be a material impact. I think in terms of interest rates, of course, there's an upward trend, but they remain historically very low. We have experienced conditions in the past with higher gas prices and higher interest rates in which demand remained intact. That is our current situation. Although clearly, you know, we're keeping our ear to the ground with customers and with our channel partners to make sure that we sense any emerging trends as early as possible.
Great. Thanks. Just following up on the longer term targets, you know, you laid out last week, specifically the boat segment EBIT margin outlook for 13% by 2025, I think that's about 200 basis points higher than the high end of the range you gave last May. I guess, you know, what have been some of the key changes that give you confidence in that increased longer run forecast? Maybe how would you rank order the drivers of the EBIT margin expansion across the initiatives laid out last week? Thanks very much.
No, good question. Thank you. I think it's important to look at where we came from to start with. You know, like five or six years ago, the boat business was essentially a break-even business, and we've got it up to just over 9% in 2021. In fact, we had several quarters where it was above 10%. I think what, you know, we start with a strong track record in recent years of making a lot of progress in a relatively modest amount of time. We haven't previously projected out as far as 2025, but of course we did project out to 2022, I think, when we were talking about 11% or 2023, maybe 11%. The drivers, there are quite a few drivers. They're operational.
We've, as you know, consolidated the footprint of our boat business quite a lot. We have about 10 plants now versus many more in the past. We've also changed the way in which we organize the operating model, essentially, so that we have a lot more centralized expertise and capability, which is deployed across all of the facilities, essentially taking operating best practices from our best plants and deploying them across all of our plants. We've also brought in people from outside Marine to be heavily involved in the way the plants operate, the quality systems in the plant, et cetera. We're just more and more efficient at an operating level.
Operating margins really start all the way back at design, and we're much more disciplined now in the way in which we design our products to cost, in addition to, of course, wanting them to be extremely competitive with all of the consumer-facing attributes. There's a much more disciplined process now that goes on with the crew design to make sure that we deliver gross margins or standard margins that are suitable for the product. One of the things that we have done and continue to do, as you will have seen with our capacity expansions, is emphasize production at our lowest cost-based facilities, and those are in Reynosa in Mexico and also in Vila Nova de Cerveira in Portugal.
Operating our plants very efficiently, making sure that we expand at our lowest cost facilities and starting all the way back in the design process with products that meet standard margin expectations really helps. In the future, though, we will get some tailwind from scale as we increase our capacity from somewhere around 40,000 to somewhat above 50,000 units. That majority of that expansion is indeed at Reynosa and Vila Nova de Cerveira. There are other things in there, but I would say those are the top contributors. Áine, do you have anything you'd like to add there?
No, thanks, Dave. I think you covered that really well. You know, really driving that operational efficiency through operations, supply chain improvement, quality, more disciplined program management, ensuring of course that we have the best and most efficient footprint, and of course ensuring that we have the best in class products and technology so that we can drive the top line too. I think those are all the major drivers as you highlighted.
Great. Thanks very much, Chris.
Thank you. Thank you, Kevin.
Thank you. Our next question comes from the line of James Hardiman with Citi. Please proceed with your question.
Thank you. Thanks for taking, I had a couple questions here. As I think about this question of retail expectations, sounds like you guys are pretty confident that you can deliver what you've laid out largely independent of retail. Maybe walk us through the extent to which retail plays a role in your long-term guidance. Then, I guess even if not, how do you think about retail over the next three or four years? Then I had a follow-up.
Hey, James, it's Ryan. I'll take the first stab at this, and then others can chime in. You know, the model is predicated, the projections are predicated on a relatively flattish retail market, flat, slightly up, kind of what it's been the last 10 years, on a rolling basis. It is not predicated on a need for retail to be outsized growth, for a handful of years. That being said, that's just what we predicated the plan on. As Dave said in his first remark, we're not seeing anything today that would give us pause, that we're not going to be in a healthy retail environment.
Both from a retail sales but also participation, which continues to be elevated, which drives TNA and the annuity side of the business as well. We're not planning on any outsize. It's not necessary for us to reach our targets, but we think it's gonna continue to be a very conducive environment.
That's helpful. I guess if we just hone in on 2022, I know this call is less about sort of the 2022 outlook, but as we think about this low single-digit industry expectation that you guys have for the year, should we expect a fairly uniform growth rate from quarter to quarter? Or, are there reasons to believe that accelerates as we work our way through the year? I guess to some degree, that's another way of asking, is this a sort of supply-driven growth story, right? As you get better product availability, should we expect an acceleration in retail? Thanks.
I think yes is the answer, James. We're clearly still in a very supply-constrained situation with no inventory, so there's no buffer really between retail and wholesale at the moment. Essentially, we can sell what we can make, and that continues to be the situation as we go through Q1. We are hoping that there will be some alleviation of the supply chain constraints as we get into the back half of the year. Certainly the Q1 has continued to be somewhat the same as the Q4 or the back half of 2021 at the moment. Without a single specific source of shortage or disruption, just multiple things working their way through the system. We continue to manage that very well.
In certain areas there is some signs of improvement which we hope will continue. Yeah, I think we will gradually work up our production and that is part of the 2022 plan that we articulated. We think that we can bring the supply base with us in terms of the plan that we set out. Upside to that, I think depends on primarily the supply base. I think our capacity actions internally are proceeding exactly to plan at the moment.
Okay. It just begs the one more question, I apologize. The signs of improvement? I gotta ask, what are the signs of improvement?
There are certain areas where we're seeing improvements versus where we were at the end of last year in deliveries from Southeast Asia.
Got it. Very helpful.
We also have and some of the constraints that we were seeing actually on commodities have really alleviated quite a lot, I would say.
Good. Thank you.
Thank you. Our next question comes from the line of Joseph Altobello with Raymond James. Please proceed with your question.
Thanks. Hey, guys. Good morning. First, I appreciate the EPS sensitivity analysis that you guys gave us under scenarios where both retail is down, I think 30%-40%, but if we did see a more moderate decline, let's say, you know, 5% or 10%, at what point does that start to impact your wholesale shipments given where we are on the inventory side?
Joe, I mean, it's, I think you can do the math. Right now we are, as just Brunswick, we're probably 12,000 units below what we were at the end of 2019. At the end of 2019 we had about 25,000 units in the field. To start this year we had about 12,000. You know, if you take retail down 5%-10%, it's not gonna make a difference in the short term because you still need to make up that 10-12,000 units and that's gonna take even in your scenario where retail is down 5%-10%, which again we have no view that that's happening, it would still take two years really to have wholesale cover retail and build back the pipeline. Still a 2024, 2025, issue, even in a retail down moderate scenario.
Okay, that's helpful. Maybe just to follow up, given the progress you guys have made in P&A, in particular in your Advanced Systems Group, is there a way to quantify how much of the content of the average Brunswick boat is supplied by Brunswick across the propulsion and P&A electronics versus where that stood, let's say, a few years ago, for example?
I think it's a great question. I think we'll have to develop an answer for that, Joe. It's not. You're not the first to ask that question. We'll try maybe as soon as the next earnings call to get you more quantification. In terms of specific examples, though, the one that I've quoted recently is the new Boston Whaler 360 Outrage, which has Mercury's V12 engines, ASG's Fathom generator replacement system on it, ASG's digital switching system, CZone. And then also now Simrad's radar, sonar and display systems. It is a very substantial bill of material content from ASG and Mercury. Great question, and we'll develop a better answer.
Okay. Thanks, guys.
Thank you. Our next question comes from the line of Gerrick Johnson with BMO Capital Markets. Please proceed with your question.
Hey, good morning. I actually have three questions, if I may. First, related to kind of the first question, we heard about the consumer. You know, in terms of boat shows, investors tend to go to Miami, New York, Fort Lauderdale, the sexy, high horsepower, 40-footer kinda boat show. You know, we've seen no significant pushback on pricing there. It's high end, a frenzied pace to get product. But can you talk about what you're seeing at some of the smaller regional shows, perhaps more blue collar shows where you do sell a lot more units, albeit at a lower price? You know, what are you seeing from those consumers at those shows, and how are they reacting to price increases, inflation, et cetera?
Yeah, hi, Gerrick. Yeah, I don't think we're seeing a lot of difference between the different shows in terms of consumer behavior. I think even at the big shows like Miami, I think we're kinda surprised that even with longer wait times, longer lead times than normal, people are still equally prepared to put down their orders. Of course, each regional show has a little bit of a different character. The U.S. boat market is not homogeneous. There are regional changes in you know, brands and boat types and to some extent, behaviors. I would say that we haven't had a disappointing show. We continue to have very strong shows from an engine and a boat perspective.
You know, nothing at a notable level in terms of pushback. I'm sure there's discussion, but it's not translating in any way into what we see in terms of retail behaviors or wholesale behaviors.
Okay, great. I'll ask just one more. This one's to Ryan, please. You know, you mentioned capacity expansion 17x in your presentation. You mentioned incremental investments, whether they be digital assets, technology, et cetera, another 22x . You mentioned that you're vertically integrating over 30 product lines to optimize logistics. You know where I'm going here. You mentioned the current fixed cost base is about $1.25 billion, and that's about 20% of your 2022 costs. Where does it go after all these initiatives? How quickly can you compress, you know, once we've hit that 30 weeks of dealer inventory, and perhaps a slowdown in overall retail.
You know, how do we compare now versus, you know, 2006 or 2007 pre-global financial crisis in terms of fixed cost base?
Yeah. Thanks, Gerrick. I'll start, and maybe Dave has some additional comments. You're right. We have our eye on the ball on cost. Obviously our revenues and earnings have also been growing at a pretty strong clip and a little bit of fixed cost has to come along with it. There's only three buckets of fixed costs. You have the fixed cost of goods, which is about 5%- 5.5%. That hasn't moved materially at all as a percentage of sales. After all the cost takeout we took in 2009, 2010. You've got SG&A, which is pretty flexible. That's call it $700-$800 million. That number could, you know, we could. That could be trimmed relatively.
I mean, it could be trimmed relatively quickly if need be. That number looked like $550 or $600 as recently as a couple of years ago, but all the spending that you're seeing is on growth initiatives and things that generate earnings and revenue moving forward. The other bucket's R&D. R&D, we're not gonna take the foot off the pedal. When I look at those three buckets, the only one that really, you know, that we keep an eye on from a spending standpoint is the SG&A, and I'm quite comfortable as a percentage of the overall revenue and as a percentage of the cost that it's appropriate for the growth story. You know us very well.
We took $500 million or so out of fixed costs from 2008 to 2011. We don't have nearly that need, even in a downturn scenario today. The downturn scenario that you saw in the deck a ssumes a modest level of cost takeout, but nothing that the business couldn't do, without a whole lot of pain. We would not be sacrificing growth initiatives.
Yeah, we also took $50 million out in-
In 2019
2019.
Yeah.
Which is really, as we separated Life Fitness and moved towards a more focused organization, we took that opportunity to slim things down a lot. We're extremely careful as an organization about adding back costs. Revenues and demand and market share gains demand that we make investments. We also are very, very careful about how we do it in terms of expected returns and investing in the most efficient way, in the most efficient facilities. That's a great count that you gave us. I think we need more variety next time. Thank you for that comment. I would say that what we did talk about is that we continue to invest in the most efficient way possible.
Inside our existing footprint where we can, adding automation where we can, investing in Reynosa and Vila Nova de Cerveira, repurposing existing facilities. We're very careful about the way that we utilize our capital, and I believe we're very efficient.
Okay. I'd love to explore this line further, but I'll drop off and let other people have a chance. Thank you very much.
We need to do a count though, don't we?
Yeah.
That's very good. That's a good comment.
Thank you. Ladies and gentlemen, as a reminder, if you'd like to join the question queue, please press star one on your telephone keypad. Our next question comes from line of Michael Swartz with Truist Securities. Please proceed with your question.
Hey, guys. Good afternoon. I have a couple questions for you. I guess just starting off, I know it's a small part of the business today, but the e-commerce side of things. I think in your 2025 plan, it looks like nearly triple that business. Just trying to understand, you know, what's driving that? Is that more product accessibility? Is it distribution capabilities? Is it maybe new consumer-facing technology? Just help us understand that ramp a little bit.
Yeah. Well, I think. Hey, Mike, thank you for the question. I'll start and then others can come in. I mean, it's really across our business. I think it's, you know, initially really driven by consumer expectation and new business norms to some extent. I think people want to conduct more of their purchase process online now. We're providing them with the opportunity to do that through configurators and more advanced and richer materials as part of our websites and other assets, which in turn gives us the opportunity for more upsell over time. With the much closer connection between what they do online with us and the final fulfillment process.
Certainly, some parts of our business utilize e-commerce more than others, particularly our P&A sales. If you think about product that can be sold that doesn't necessarily require dealer installation or some, you know, significant amount of professional effort afterwards, that is a significant growth area for us. Some of our channel partners are online as well. Maybe I'll ask Brett to speak from an ASG perspective. Brett?
Yeah. Yeah, no, I would agree with Dave largely that consumer expectations are changing. I think the pandemic, in many respects, helped accelerate that change in buying behavior. Increasingly, with the types of products we sell, they're gonna go to sources they trust. I think we're well positioned to provide the right content to help them through the purchase journey. It's a combination of technology and content strategies and just a general shift in consumer buying behaviors that allow us to be, I think, a definitive source for direct-to-consumer selling.
Okay, great. And just one follow-up, and, you know, I think you've announced 8 new electric outboard engines by calendar year-end 2025, if I was reading that correctly, and you showed one at Miami. But just, I guess at a much higher level, I mean, how do we think about electric as, you know, maybe a percentage of outboard mix over the next couple years? And, I mean, what is the ability to platform electric product or technologies with your existing internal combustion lineup?
Yeah, as we have said, Mike, we think that, I mean, there is a viable market for electric outboard product, but it is lower horsepower product. It's an existing market. It's almost entirely in Europe, and it's almost entirely based around regulated lakes. The fact is there are many thousands of electric outboards sold every year, and the number is increasing, but 90% of them are lower than five horsepower. It's clearly a gap. We sell internal combustion engines from 2.5 horsepower up to 600, as you know. The overlap with our existing product line is modest and clearly at the lower end. As technology develops, the ability to go to higher power obviously increases with more efficient weight and cost-effective battery technology, particularly.
We are starting with low horsepower and moving up. Our expectations at the moment are that how far we can go up is still quite limited and making something that is, you know, broadly good value to the consumer and will have a reasonable scale of market. It is a real market, and we intend to be a very active participant in it. We have the same expectations for return on investment for our electrified product that we do have for the rest of our product line. In terms of the ability to platform, it is possible to platform if you think through motors, inverters, even some of the housings and other things within certain horsepower ranges.
You know, you might, and this is completely hypothetical, have a platform that covers, like, 1-5, another platform that covers, you know, 10-20. This is hypothetical. It is possible to derive a number of horsepower nodes from a single or closely associated platform of components. Just as we have done with our internal combustion engines, we will take that approach with our electric product. I would not, though, neglect the work that we've already done and continue to do on generator replacements, that there is a way that electrification can make its way into larger boats, just not necessarily through propulsion. There is that other engine on most large boats that can be replaced.
Our strategy does not neglect higher horsepower and larger boats, just, it's just a different strategy, different way of replacing combustion engines. Go ahead.
Yeah. Maybe I'll just make one build or add on Dave's comment around generator replacements, and I couldn't agree more. It's a huge opportunity. I just wanted to make the point that it's not only limited to the marine industry as well. There's a pretty sizable addressable market outside marine in RV and work trucks that we're accessing today. It's not a theoretical opportunity. It's a very real opportunity that we're capitalizing on and marketing.
Thank you.
Thank you. Our next question comes from the line of Xian Siew with BNP Paribas Exane. Please proceed with your question.
Hi, guys. Thanks for taking the question. I appreciate you guys sizing, you know, the downside scenarios, but just wanted to maybe just dig in a little bit more on those. For example, for the P&A, can you maybe disaggregate how much of your P&A business is, you know, parts that are necessary for annual maintenance versus maybe some parts or accessories that are more discretionary and could be deferred out? Like, trying to get a better sense of what's really required annual maintenance.
Yeah. I'll take that, and Chris, maybe you can also add in. You know, we believe, you know, about 75% of our P&A business is aftermarket, and a large majority of that we would consider necessary maintenance and things that you just have to either consume, right, consumables, oils, lube, filters, or things that just need to be repaired, replaced on normal usage. I think a lot of the nice-to-haves, right, the things that you could do without, a lot of those are in the boat parts and systems side of things, which is generally kind of a bit of the lower margin and more commodity type products. We're happy to sell them. We distribute them same day, next day, obviously through our distribution business, but the large majority of that aftermarket is required and necessary.
Yeah.
Okay.
I'm sorry, Chris, I didn't mean to interrupt. I would say, though, that, you know, if you look historically, even in the financial crisis, P&A only went down about 5%. It isn't as though even in very tough financial circumstances, you see some huge change in behavior around aftermarket items on a boat. We actually saw that be extremely consistent. I would say that, and we've mentioned it recently, that consumers are, you know, in a lot of cases will keep a boat for a while, but they don't want old electronics. They want new technology. They wanna be able to catch fish better and easier than they did before and better and easier than their friends can.
We now have ways of satisfying that, including things like over-the-air updates. We have new ways of delivering technology that make us even more robust, I think, than we were in the past. Sorry, Chris. Please go ahead, Chris Drees.
No, thanks, Dave. When we look at the Mercury and the replacement parts, those are really necessities to replace the propeller to keep your engine running. I would consider all the Mercury P&A, for the most part, a necessity to keep your boat and engine running smoothly.
Okay. Yeah, that's really helpful. Then maybe just on the propulsion side as well, you know, you showed how it's, you know, potentially down less than boat retail. Maybe you can help bridge that gap as well a bit more, you know. Are you thinking about things like share gains and, you know, more repower sales or just some more, you know, dimensionalization of that would be helpful. Thanks.
Yeah, Dave and group, I can grab this one a little bit. If you think about some of the markets that we have a lot of opportunity at in the commercial market
Certainly we're just touching the surface on some of that. As it goes on, the repower market opens up more broadly. Also the new OEMs. As we continue to launch new products, we're seeing great acceptance by new OEMs in the marketplace, and that's after we fill current back orders. Certainly a lot of potential on the propulsion side. Okay. Very helpful. Thank you, guys. Thank you.
Thank you. Our next question comes from the line of Joseph Spak with RBC Capital Markets. Please proceed with your question.
Thanks so much. Thanks for hosting this call. You know, we touched a bunch on some of the near-term issues here. I guess I wanted to ask a couple of bigger picture questions. Just with all the initiatives and plans you have in place, but also everything else going on in the world, and I realize you might not have it set yet, but I'm curious to sort of get your thoughts as how you're thinking about this. Like, how do you reimagine your supply and value chains? Because it seems like, you know, everything's gonna require sort of a rethink for what might be, you know, a different world for the next 10 versus the prior 10.
Secondarily, just for the initiatives that are aligned with your ACES view and the digital journey you're trying to take the customer on, how are you finding your ability to attract the right talent to execute on that?
All really good questions. Thank you, Joe, very much. I think, you know, on the supply chain is not our reimagining, if you like, of the supply chain is a more continuous process than you might think. A lot of things have occurred over the past several years. Tariffs, for example, would be one that cause you to rethink the way that you source product. Certainly, we've mentioned recently the high degree of vertical integration that we have, particularly in Mercury. With the investments that we're making now, that depth of vertical integration will be further increased. Then the acquisitions that we're making and the technologies that we're developing organically all mean that we have more capability product systems that we generate internally.
I think, you know, clearly people are moving, and we are moving less JIT and more towards supply chain robustness. That is, you know, clearly a new theme, if you like, over the past several years. We're well along with that insourcing of certain product lines. You know, one of the advantages we have is there aren't many people big enough to insource some of this stuff and for the volume still to make sense, but for us, it can really make sense, especially if it avoids disruption. I, you know, as we mentioned, sourcing patterns are changing. The products that we get delivered are changing. The amount we insource is changing. Our continued investment of vertical integration overall continues to help us a lot.
Does anybody else have any comments on that?
I guess just to say from a boat side, boat perspective, of course, we're doing all of the vertical integration that we've talked about. I think it's very helpful for us with our sister divisions as well. That certainly enables us to manage the supply chain. I think just this kind of longer term visibility, more holistic contracts in place, I think are really helping us. You know, this longer term viewpoint that we're taking, and to your point, less of the just in time and more of the robustness has really been helping together with the sister division relationships is enormously helpful.
You know, on the second question, Joe, I think we're doing extremely well sourcing talent. I think, you know, the investments that we make in our culture and our compensation systems and our inclusiveness programs, of course they're the right thing to do, but they genuinely really help us. We have a great culture that's really well recognized. When we get external recognition by you know brands like Forbes and we place really high, not just in our industry, but across industries, it is a huge benefit for us, and we're getting a really strong return on it. We have hired incredible management and technical talent from multiple industries at senior management levels and throughout the organization just over the past two or three years and continue to do that.
The market is certainly, you know, it's quite aggressive. You know, we have to move quickly. We have to present the right kind of proposition. In our space, I think nobody else is better equipped to do that than we are. I think we're being very successful if you think just in the senior leadership team. Recently, we have Áine Denari from Tier One Automotive. We have Brett Dibkey from Consumer Goods. We have John Buelow from Ag. A lot of people coming into the business with exactly the capabilities that we want and the talent, you know, who view Brunswick as strong growth and with the right culture to be able to develop their careers. The operating model we put together really helps too.
I think having four divisions instead of just two gives everybody more opportunity to demonstrate their capabilities and shine and participate in the multiple growth factors that we have. Everybody's highly motivated and we're getting really strong talent still. Actually, you'll see more of that in the coming months.
Great.
Yeah, sounds like.
Sorry. Sorry. This is Brenna. Sorry, Joe. I'll just build on the I love the question and the reimagine. What we haven't talked about yet, I would also say we are reimagining the future of participation in marine. as we look at the future, it is not just a set of discrete transactions, but Brunswick is positioned in position really to win with consumers of the future over the course of their boating lifetime. as we are bringing in and winning with new consumers, you can imagine in the next 5 to 10 years, the marine industry is gonna look different. differently, and Brunswick is best positioned to win.
In addition, just the synergies within the organization and our portfolio as we think about the connection points to ultimately build a better experience. We have a very strong, optimistic view of the future and participation.
This is Brett. I just wanted to build, I think, on points that underpin what Dave and Brenna shared. I think we've had remarkably good luck in attracting top-tier talent from a variety of different industries. I think that's driven, in part, not only by the industry as one that elicits a lot of passion, but as Brenna was kind of alluding to, I think people generally understand and really connect to the narrative of Brunswick and our ability not just to participate in the transformation of the industry, but to really help drive it and lead it. When you couple that with an industry like ours that's fun and again elicits passion, I think it becomes a really attractive value proposition for top talent in the industry. I think we're seeing evidence of that every day in our recruiting efforts.
Yeah. It sounds like your scale and positioning is in and of itself a competitive advantage in a rapidly changing world. Appreciate your thoughtful perspective, team. Appreciate it.
Thank you. Thank you very much.
Thank you. Ladies and gentlemen, as another reminder, it is star one to join the question queue. Our next question is a follow-up from the line of Gerrick Johnson with BMO Capital Markets. Please proceed with your question.
Hey, thank you. Dave, you mentioned consumer-centric innovations in your presentation. I would love to hear more about that, the process, and how you gain those consumer insights to develop that consumer-centric innovation.
Yeah. Thank you for the question, Garrick You know, we talked quite a bit about, and I'll turn this over to Lauren Beckstedt in a second, about unique ways that we have developed over time, you know, partly, I think out of always looking for something that is an advantage, partly because that consumer dynamics are changing so fast, that allow us to get more real-time insights into consumer behaviors. And then I think we benefit a lot from the breadth of our portfolio. We have just a lot of touch points with consumers, from value boats to premium boats, from participation models like Freedom. So maybe I'll turn it over to Lauren to expand on that, and then we can talk about how that drives innovation.
Yeah. I think to finish the point, as it relates to portfolio, one of our competitive advantages, especially as consumers interact with our brands more and more digitally every day, we get a macro view that nobody else has. Looking at those big picture aggregate trends around the consumer helps us stay more nimble and dynamic. Other things we've put in place, like Ripple, which is our consumer community that gives us real-time feedback about consumer interests, preferences, behaviors, that we can really turn on at any point during the year cycle to stay in touch and stay close to trends. That's just one example. I think we've got lots of different mechanisms to stay close to the consumer to inform our innovation process. Those are two of the stronger competitive advantages that we nurture.
Then how it drives innovation, I think a couple, you know, of examples might be product innovation and then business model innovation. On product innovation, of course, we share some of the high-level feedback that we get from the Ripple online community, which is, I think probably coming up on 5,000 members. But actually we work with that community in a lot more depth. For example, as we developed our electrification strategy, we were able to try and understand adoption rates, what does an early adopter look like? What does a late adopter look like? What are the attributes that they might be prepared to trade off on? As we go into the process of designing a product, we understand range, speed, performance, aesthetics, you know, other attributes, digital attributes, for example, connectivity.
Where in the case of electrification, where there's almost always some level of trade-off, where are people not willing to make a trade-off, and where are they willing to make a trade-off? That has driven a lot of the direction and a lot of our electrification strategy. In terms of business model, you can imagine that in a business like Freedom, there are lots of inside that, a lot of programs, a lot of pricing opportunities, a lot of different ways to participate. Brenna, I don't know if you wanted to.
I would just add, we have a direct line of communication with 50,000 boaters that in their respective, are very diverse. In addition, you know, Boateka is a great example of a business model that was born out of an insight where consumers want trust and transparency in pre-owned boat purchasing. We've learned as we've designed the business, and we continue to do a lot of learning by doing, we're refining the business model. We're agile and we pivot, but consumer insight is really what's driving how we design our business models and build a competitive advantage.
Thank you, Gerrick. Great, great question. Of course.
Thank you. That concludes our question and answer session. At this time, I'd like to turn the floor back to Dave for any concluding remarks.
Thank you, Melissa, very much. Thank you all very, very much for taking the time to join us today and for the excellent questions. I am very pleased that you had the opportunity to interact with our outstanding team today. As you can tell, we're all very excited about Brunswick's progress and the future potential of all of our businesses. In the coming months, you will see many more examples of our unique Next Wave strategy being brought to life. Thank you all very much for your time, and have a great day.
Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.