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Old 03-15-2015, 01:38 PM   #21
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In answer to your question of whether people pay that. NO. As a production boat there is considerable mark up on that boat. The average price paid for that $1.6 million MSRP is probably around $1.3 tops and might be closer to $1.2 million. Invoice to the dealer on that boat is 65% of retail. That's before any other reductions or discounts Marine Max might receive.



I don't have the price sheet on the 510, but looking at the 470, base price is $1.064, dealer cost is $692, typical selling price around $800-850. Now it is very easy to add another $200 on the price which will add about $160 or so to the purchase.



And this is the market segment that has performed the worst the last few years.

How much of that type of margin, if any, is in the price of a new Nordhavn, Krogen or other builder that sells direct? That seems like a pretty steep dealer markup for higher priced boats. Is there that much negotiating room on new boats? Where does one find these types of numbers and data? You can PM me if desired.


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Old 03-15-2015, 02:31 PM   #22
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I was thinking this the other day as I looked at a brand new Nordic Tug. I always thought they were well built (they may be) but I was surprised at how Spartan and poorly finished they were. Not that the gel coat was bad or anything, just lots of techniques to leave an edge alone, simple finishing, no trim. Then I looked at an Azimuth and it was like a Rolex to the NT's Timex with really snazzy lighting, great doors, stainless polished vents. Teak decks. Huge difference and no clue what the difference was in price. Azimut is Italian but I couldn't find out where their yards are, Asian? I suppose the NTs, if finished like an Azimuth, would be priced too high? I suppose the Azimuth appeals to me because it sorta kinda looks like my boat but mine is finished like a fuel tank, nothing snazzy at all.
Do some research on Azimuths. I think you find their beauty is only skin deep.

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Old 03-15-2015, 02:43 PM   #23
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Do some research on Azimuths. I think you find their beauty is only skin deep.


Yup, and very expensive to maintain. Watched a 3 year old one go through a fuel leak chase down and bottom of tank fitting redo.
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Old 03-15-2015, 02:55 PM   #24
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How much of that type of margin, if any, is in the price of a new Nordhavn, Krogen or other builder that sells direct? That seems like a pretty steep dealer markup for higher priced boats. Is there that much negotiating room on new boats? Where does one find these types of numbers and data? You can PM me if desired.

Kevin
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Companies that sell direct fall into two groups. Those who use only their own salespeople and those who open it up to other brokers. However, as a general rule going through dealers is going to add 10-20% to the selling price over direct sales and broker sales.

Now, because they're a volume production builder Sea Ray can build a boat like this for 10-20%, maybe 30% less than a builder like Nordhavn or Krogen could build the same boat.

So when buying a boat like the Sundancer, you generally would expect to get 20% or so off of MSRP.

When a semi-custom builder like Nordhavn or Krogen quotes you a price there isn't a lot of room left for negotiation generally. Some will negotiate a little, some won't. But even with those who do, it's typically less than 5%. And you're really working from a quote, not an MSRP as you think of one. Some don't publish prices or make them difficult to get to. Others publish prices even on Yacht World.

We're talking two entirely different types of boats and channels of distribution. A builder like Sea Ray couldn't reach their volumes without a large dealer network.

Builders like Princess would fall somewhere in between. They use a specific network of brokerages/dealers. They may have a little more room for negotiation than factory direct would have.

It's very important for a builder to choose a means of distribution right for them. If you're going to go with dealers and provide the type discounts they expect, then in return, you should expect them to stock some boats. You can go direct and offer a better price but with no boats stocked and no dealers pushing your brand you might not penetrate the market.

Some builders are finding another route. For instance, Hatteras continues to change their methods, but it appears their current plan is to have their own sales centers with boats to see and have a network of brokers who can use their facilities and inventory.

One more brief case study and that is Grand Banks. One of their many issues has been the escalation in price. They had something most resembling a dealer network, but no one stocking their boats. Some have some Eastbay models in inventory but not the Aleutian or Heritage models. So higher costs but lacking the benefits. They were considering some sales centers and set up one in the PNW. Then things changed and they turned back. In my opinion right now their prices reflect a dealer structure but you can't go to a dealer and see a boat.

Another issue with structure is getting people to whom selling your boat is a primary issue. Bluewater is a Grand Banks dealer. They have one Eastbay in inventory, nothing else. They have 24 other new boats-Viking, Sabre, Back Cove, Jarrett Bay (which they own) and Regulator. In semi-custom yachts they sell Princess. Now you tell me how many Grand Banks' they are going to sell. Grand Banks lists Galati on their web site, but Galati doesn't list Grand Banks on theirs.

The price structure of many production builders is available on seedealercost.com. It's the boat equivalent of the auto sites.
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Old 03-15-2015, 02:59 PM   #25
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To the Azimut discussion that entered the thread. In many ways you're talking two entirely different companies in talking Azimut US vs. Europe. Their reputation in Europe is generally ok. In the US it is horrible, partly due to how warrantees are handled, primarily by MarineMax. That's where it's hard to separate MarineMax from Azimut. Keep in mind that most of MarineMax boat sales are production boats. They recently added Ocean Alexander. I can't imagine that going well for OA. And one final piece to the equation to show the difference on Azimut. The boats being sold in the US now are not built in Italy. They are built in Brazil.
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Old 03-15-2015, 03:09 PM   #26
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All I did was walk the docks and compared the fit and finish of two similar-sized trawlers, both about 42' One was a very shiny, snazzy knockout and the other was, well, a boat. I don't know much about either but I do know that having worked for a well-known business jet builder for some time, snazzy sells. At the risk of being rude, why else would anyone buy a Sea Ray?

Brazil makes some great products, Embraer springs to mind...
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Old 03-15-2015, 03:34 PM   #27
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All I did was walk the docks and compared the fit and finish of two similar-sized trawlers, both about 42' One was a very shiny, snazzy knockout and the other was, well, a boat. I don't know much about either but I do know that having worked for a well-known business jet builder for some time, snazzy sells. At the risk of being rude, why else would anyone buy a Sea Ray?

Brazil makes some great products, Embraer springs to mind...
Azimut doesn't rank in Brazil's great products unfortunately. Azimut tends to use a lot of outside contractors and so different people may be doing the wiring and plumbing of boats built. That leads to a lot of inconsistency. I wasn't taking a shot at Brazil, but the fact many purchasers believe they're buying an Italian built boat and are not is disturbing. When they were being built in Italy, they still had some of the issues. My opinion there was that they primarily emphasized the build of a European model and struggled, using various people, to do the conversion to US electrical systems. Emphasis often shows the cause of issues. Azimut Benetti's emphasis is definitely Europe.

As to why anyone would buy a Sea Ray, they're probably the best at what they do. They build a quality production line of boats with very few problems compared to other builders including many custom builders. They do the same thing over and over and do it well. Now, most trawler owners are not going to find Sea Ray attractive. I have owned three under 25' Sea Rays in my life and liked all three. As to Sundancer, it's the perfect boat for many rivers and a good coastal boat for families who primarily get to boat on weekends. They can cover some area. They're not living on board. They're more interested in speed than economy. Most Sundancers are sold for families to enjoy. Later in life perhaps the owners move to the Trawler world. There are a lot of Sea Ray owners we see running beside us to the Bahamas as well. Again, you're a family with one week to see the Bahamas. It's important to be able to get there and back in one day, do quick island hopping white there, and know the boat is dependable.
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Old 03-15-2015, 03:40 PM   #28
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At the risk of being rude, why else would anyone buy a Sea Ray? ...
Once you desire to go fast, ski, boogie board etc they fit the mold for tens of thousands of happy owners. Great creature comforts on the larger ones and when buying used allow the middle class (whatever that is) to enjoy the water.

I've owned 3 of them and would not hesitate to buy another for the niche they are designed to fit into. Take a trip to the Columbia River, Mississippi, Shushwap, Flathead, or Lake Powell and your question would be answered.
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Old 03-15-2015, 03:43 PM   #29
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Sorry if this sounds familiar, but I have tried to follow the politics and financials of the new America over recent years and just have to chime in.

Skinny, you are a pretty sharp and practical kid for your age. I suspect you are a pretty happy fellow as well.

It is a well established fact that the ends of the income spectrum in the US have been expanding considerably over the last 20 years or so - particularly on the high end.
Those that have been able to benefit from the new Internet and Globalization age have done very well indeed. The majority of us in the blue collar middle have suffered considerably from the out-sourcing of good paying manufacturing jobs - those jobs our parents did quite well in.

A large chunk of the successful "Internet kids" are pretty well set if they don't blow it. As Auscan said, they look to have more money than they know how to spend right now.
Living in the SF Bay Area, I see this everyday in the Teslas, Mercedes, and Lexus on the road everyday. Thank God for "trickle-down".

And, as Skinny pointed out, youngsters these days yearn for a different lifestyle than we or our parents did. They want the latest fashion and electronic toys. They prefer an apartment or condo over the latest higher end shopping center over a home and yard in the suburbs - and they have been programmed for that in school. The population has grown by 100M since we were kids, and it will likely grow another 100M before we are gone - just not that many homes in the suburbs for all those millennials.

We were also fortunate enough to still be employed during the Great Recession and be able to buy an old boat that I could do much of the work on for what I thought a good price. We were also confident enough to buy up some rental properties near the bottom by leveraging ourselves to the hilt - something that would have turned our Depression exposed parents white as sheets!
One last point to be made about the cost of boats today, as well as cars. Government regulation in everything from safety to health and environmental regulation has added a huge markup in vehicle costs - and I won't even start on the cost of litigation.....
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Old 03-15-2015, 04:19 PM   #30
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So we went to the local boat show in Cape Coral yesterday and it was interesting.
I would never have thought that a new 51 SeaRay Sundancer now has a price of $1.6M..That's right, million for a Sundancer. Finding this a bit hard to accept I went home and went to Yacht World. A 2013 version is under contract for $771,000 currently. Marine Max did have at least 8 listed though and all new,

So do people actually pay that for this boat and then just eat that kind of depreciation?

I could not justify that kind of depreciation for anything in this world.
Was this held at the Harbor at Cape Coral per chance? Had my Cherubini on the same dock as their display boats last year. One of the salesmen said he could give me a great trade in on one of the 40 something foot boats. I forget what he said they sold for. Just laughed and kept walking. For that kind of money you could have a nice used boat, a house on a canal, a dock to keep the boat tied up to, and change back.

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Old 03-15-2015, 05:35 PM   #31
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I know this has been brought-up several times, but boat ownership has become out of reach for most of the middle class. I have reviewed the statistics and boat owners are becoming older and wealthier.

My parents earned a decent living back in the 80s and could afford a three bedroom house, two cars, and a trawler (three children as well). I remember the Florida ICW back then teeming with life: sailboats, small powerboats, trawlers, etc. Mom and Dad took two week vacations and weren't glued to the cell phone (yes they had one then) or laptop during their time off.

Fast forward to 2015... My wife and I earn a good living but we wouldn't dream of owning anything larger than Sherpa while working. I avoid debt, save for retirement, and pay with cash when at all possible. I can hardly take a few days off and work far, far more hours per week than my parents who were professionals as well. There is now an expectation today that one should work during vacation or not even take a vacation.

I was recently reading my Dad's old "Time Life" boating books (maintenance, navigation, and Handy Boatman). The photos from that time are very telling: young people owning boats and no obnoxious yachts.

Times are different. My generation will not be enjoying generous vested retirement plans, golf, and owning large boats in their later years. Instead, they'll be working until death.

Sorry for venting.
I'm with ya, buddy.

But I'm satisfied with owning a boat that I admired as a teenager.
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Old 03-15-2015, 08:27 PM   #32
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Was this held at the Harbor at Cape Coral per chance? Had my Cherubini on the same dock as their display boats last year. One of the salesmen said he could give me a great trade in on one of the 40 something foot boats. I forget what he said they sold for. Just laughed and kept walking. For that kind of money you could have a nice used boat, a house on a canal, a dock to keep the boat tied up to, and change back.a

Ted
Yes Ted it was at the Harbor. Pleasant young 26yo was trying his hardest to take my Viking as well.

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Old 03-15-2015, 08:55 PM   #33
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1.6 for a "go-fast" basement boat is a lot of money. 700K will buy you a really nice trawler, real nice.......
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Old 03-15-2015, 09:30 PM   #34
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My father bartered for a brand new 1969 Chris Craft Commander with the dealer. He built a breakwater for the dealer's marina. I wouldn't be able to own a boat if I didn't own a business. I get lots of fringes (vehicles, phones, computers, fuel, tools, etc.) or I could never afford my 30 year old boat. I do all the work myself too. My biggest expense is my slip rental. But if I had enough money for a new boat, I probably wouldn't buy one, A nice 5 year old boat would be fine.
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Old 03-15-2015, 11:20 PM   #35
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You want how much?

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1.6 for a "go-fast" basement boat is a lot of money. 700K will buy you a really nice trawler, real nice.......

The admiral and I call these "bubble boats" because of the silly fly bridge enclosed in plastic. They motor up to an anchorage with a 30-something with a pot-belly at the helm. Fortunately they usually have a couple of bikini clad hotties aboard to keep things interesting for us old codgers...you rarely see them north of Desolation Sound, where the average age of the boater goes up 30+ years.

A new build Krogen 48 will probably come close to matching, if not exceeding that Searay...guess which one I'll choose if I win the lottery! Guess which one depreciates faster!


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Old 03-15-2015, 11:37 PM   #36
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Geez JD, what do you think of Bayliners and their owners?
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Old 03-16-2015, 12:25 AM   #37
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The margins may be high during low sales, if the number of sellers has decreased more.

Any way you look at it, the $ value dropping in half in a year is a big hit. Wow.

My guess is that people buying a new boat such as that, are likely those who have retired with more money than they are likely to spend in the rest of their lifetime. Maybe they are not overly experienced boaters. They are convinced by a salesperson that the boat is easy to handle with all the bells & whistles. They deserve a boat like this after working hard all their life, just to relax and enjoy life.

It soon becomes obvious that a 51 foot boat isn't as easy to handle as it was during the cruise from the sales dock on that perfect day. Perhaps it's downright stressful rather than relaxing. And the grandchildren get bored of it after a few outings. So it goes on the market along with a quite a few others in the same position. The market gets flooded. Supply & demand.
Correct!
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Old 03-16-2015, 02:24 AM   #38
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Geez JD, what do you think of Bayliners and their owners?
They don't want to go there Sunchaser.

After the naysayers cross the Gulf of Alaska in their boat(s), we can all sit down, have a beer and discuss sea keeping ability on equal terms.
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Old 03-16-2015, 04:25 AM   #39
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A bit of a rant, I know but I hate when groups/generations are lumped together. We all are different and have different goals and priorities among all walks of life.

Not all the internet "kids" of today are the same. Some of us prefer old, even if we have the funds for the flashy. Some of us save and responsibly purchase old boats that need a bit of love. I would much rather spend a day sitting at anchor or teaching my kids the finer things in life that few ever get to experience, such as paddle boarding next to a waterfall in 900' of water in the middle of the inside passage, than spend time trying out the next battery powered super car. I bought my first boat at 36 (I turn 39 in a few weeks), a 20 year old 58' footer. A great boat, and everyone said I
was crazy, never owning a boat before. They said it was too big, I could not handle it. Well, I got a captain to sign off on my insurance after the first day of running it. He said it usually takes a few weeks. I put more hours on it, its first year than just about anyone in my marina, that was weekends and 3 weeks of vacation. I did not shy away from anything, and worked hard to learn everything. By the 18month, I singled handed the boat several times. No, it did not have stern thrusters. Then we sold the company I helped grow (IT company). I profited, and sold that great West bay son ship for a boat that was 2 years older, and did not have carpet, walls, or much as it was a refit turned in, as the owner went on to purchase of a brand new boat (almost $4m if I remember correctly, and by a person >60.) I removed the old electronics, gutted the built in furniture and redid it much my own, I did hire out the carpet installer and some of the electrical, but designed my electronics, install cork, redid engine room, converted lights to Led. I spent 1 year, most evenings, weekends working on it with one goal in mind. I bought this boat as it was heavier, stronger, more economical, and well, looked a bit more like a classic yacht. I bought it to learn everything I could, because I was going to touch almost everything on it.

The point? Don't judge a book, person, or generation by its cover. We all march to our own drums.

By the way, I reached that goal this summer by captaining my vessel and family (4kids) up to Alaska, and while I would not mind experiencing the rush of the new tesla, my investments are for either my future retirement or for providing my family with experiences they will tell their kids about.

As to the $1m + boat or "ugly" bubble boats. I leave you with something my boat broker said to me. "There is a boat for every person and a person for every boat. "




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Old 03-16-2015, 06:51 AM   #40
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"How much of that type of margin, if any, is in the price of a new Nordhavn, Krogen or other builder that sells direct? That seems like a pretty steep dealer markup for higher priced boats. Is there that much negotiating room on new boats? Where does one find these types of numbers and data? You can PM me if desired."

DIY is easy as many overseas yards will work with an owner.

The builder markup is usually about 20% and the dealer markup is 20% to 25% .

Much of this can be avoided by going to the builders yard and cutting a deal.

Sure YOU will need to hire someone there to watch your interests , or sit 6 months when construction starts.
However you may get to select all the gear that you prefer to the normal cookie stock boat selection.

You could have a Detroit instead of the higher list price (not cost ) Volvo.

Time or money , a newbuild offshore boat is your choice.
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