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Old 08-10-2018, 07:09 PM   #21
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We're lumping a lot of tariffs and a lot of destinations. Plus a lot of unknown.

Here's the known at this time.

Canadian boat dealers are extremely worried as the majority of boats sold by US builders to Canadian dealers are aluminum so they're hit with a double whammy, the material cost importing to the US and the tariff by Canada.

Every inboard or inboard-outboard boat manufacturer in the US who sells also in Europe is feeling pain. They're trying to shift what they can to outboards. This has impacted major builders but also some small custom sportfishing boat builders.

Now, as to all the rest of it, everyone is living with major uncertainty. All pricing is being done right now with the buyer taking full responsibility for any tariffs. A lot of buyers are not willing to do that. The importers of European boats in South Florida are having a decrease in orders, even though there are currently no new tariffs on them.

We face uncertainty on every product we sell. We have no idea what will be hit in the next few months.



And it's particularly difficult with boats because there is typically a long gap between contracting and delivery, and nobody knows how tariffs might change in that time. It's a huge risk to contract a boat today knowing that the actual cost may be 10%, or 15% more, or 25% more when you finally take delivery. Whether it's the buyer, or seller, or both who take the risk, it's a big risk.


But all this is great for the brokerage market....
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Old 08-10-2018, 07:26 PM   #22
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The metals markets and companies that produce same are a world wide group. Generally the cost of goods sold, capital recovery, shareholder earnings (profits) and revenues received must be in balance for capitalism to work.

As example, US aluminum companies are public companies. Without a solid balance sheet they go under. Chinese production from in country aluminum companies is government controlled and owned. The cost of goods sold is largely irrelevant, the goal is to employ people.

When the cost of goods sold would prove atrocious and non economic in the US, in China that problem is less an issue as the government covers the losses to keep the enterprise going.

Thus tariffs get imposed. It has worked this way worldwide for a very long time. And yes I understand the world wide metals markets by virtue of having worked in the business including experience in China.

The impacts of tariffs on Al boats is as noted by Dave M, not much. The real issue seems, as noted in the press and trawler forum is purely political. The Chinese government would like to see it stay this way.
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Old 08-10-2018, 08:24 PM   #23
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I read on a Nordhavn site, that a lot of the hardware that is installed, is shipped to China in bond, and the value of those components was deducted from boat value,!when imported and not subject to tax.
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Old 08-13-2018, 01:09 PM   #24
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My thoughts would be deemed political, so I will bite my tongue.
Bump. I will add, that all I see here in the PNW is boats and boat related business doing really well.
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Old 08-13-2018, 02:12 PM   #25
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South African built boats are exempt from US import duty as are many other boats built in countries considered to be less than "first world.) Check with US Customs.
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Old 08-13-2018, 02:24 PM   #26
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Bump. I will add, that all I see here in the PNW is boats and boat related business doing really well.
Go visit a nearby Canadian boat dealer who sells primarily aluminum boats and you'll see concern.

Or go find a builder who ships a lot of boats to the EU, which I don't know that there are any in the PNW.
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Old 08-13-2018, 03:04 PM   #27
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Go visit a nearby Canadian boat dealer who sells primarily aluminum boats and you'll see concern.

Or go find a builder who ships a lot of boats to the EU, which I don't know that there are any in the PNW.
The world is awash in Al finished metal. LME bonded warehouses have over one million tons in inventory. This does not take into account producer or country stocks. Canadian Al boat builders have boat demand, high taxes, high COL and skilled tradesman shortages that are their economic drivers.

Not too mention the current Al glut is hurting Canadian Al metal refining producers. Overall, Canada would benefit greatly from Al price increases, which are not forecast to occur.
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Old 08-13-2018, 03:06 PM   #28
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The world is awash in Al finished metal. LME bonded warehouses have over one million tons in inventory. This does not take into account producer or country stocks. Canadian Al boat builders have boat demand, high taxes, high COL and skilled tradesman shortages that are their economic drivers.

Not too mention the current Al glut is hurting Canadian Al metal refining producers. Overall, Canada would benefit greatly from Al price increases, which are not forecast to occur.
I didn't say anything about Canadian boat builders, but Canadian dealers who import US boats and now face a 10% tariff. They're the ones indicating a problem and most of the boats exported from the US to Canada are aluminum.
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Old 08-13-2018, 03:49 PM   #29
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I didn't say anything about Canadian boat builders, but Canadian dealers who import US boats and now face a 10% tariff. They're the ones indicating a problem and most of the boats exported from the US to Canada are aluminum.
So the Canadian Al boat builders will be happy! Win win eh.

But seriously, the $C vs $US is the big impediment for Canadians buying US products of any kind. Fortunately commodities are priced globally in US dollars so Canada's resource guys are mostly better off the past few years.
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Old 08-13-2018, 08:10 PM   #30
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So the Canadian Al boat builders will be happy! Win win eh.
The Canadian boat building industry never really recovered from the end of the 80s boom. NAFTA eliminated tarriffs that had previously offered them some protection from US competitors around the same time. The majority of new boats sold here in the last 25 years were built in the US.

Maybe the few remaining builders able and willing to ramp up will have some opportunities, but in general the recent trade disputes have introduced a lot of uncertainty and short term pain.

I should say that I know nothing about the aluminum boat market, except that they're by far the most common craft on the Trent Severn :-). Pontoon boats rule, apparently. They're tricked out with big comfy chairs and 150 hp motors. But I digress...

My observations are based mostly on larger sailboats but I'm sure it's true for powerboats as well.
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Old 12-19-2018, 06:14 PM   #31
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Any known impact on the used markets? Asking as I had a discussion with a broker about two different used boats in Vancouver: one was made in China (originally) and the other in the US.

He suggested that the used, Chinese made vessel would have a 10% tariff applied when bringing back into the US but the US made vessel would not.

Sounded strange to me given both are used vessels but there isn't a lot of official documentation to find/read on the topic. Curious is anyone here actually knows.
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Old 12-19-2018, 06:19 PM   #32
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Any known impact on the used markets? Asking as I had a discussion with a broker about two different used boats in Vancouver: one was made in China (originally) and the other in the US.

He suggested that the used, Chinese made vessel would have a 10% tariff applied when bringing back into the US but the US made vessel would not.

Sounded strange to me given both are used vessels but there isn't a lot of official documentation to find/read on the topic. Curious is anyone here actually knows.
I'm not so sure about that. The boat was imported from China into Canada.


Now the boat is being imported from Canada into the US. That is a different story but outside the scope of the China tarrif.

A customs broker would easily be able to answer this one with certainty.
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Old 12-19-2018, 06:57 PM   #33
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This information is so simple to find how can intelligent people on this forum be so deluged by BS and believe it. The import duty on foreign built pleasure boats is 1.5%, not 10%. And boats built in some countries, like South Africa for example, are exempt for US duty.

https://help.cbp.gov/app/answers/det...e-into-the-u.s.
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Old 12-19-2018, 09:11 PM   #34
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Personally, I find the whole situation (trade disputes between Canada and US, as well as the worsening political situation) to be very unfortunate, as well as divisive between such good allies and neighbours. However, I am far from an economics expert.

For me personally, if I was trying to purchase the same US built boat (used from the US) today, as I did in 2016, I could not afford it! It is now subject to a 10% import duty, the same as Chinese and most other import built boats.
So, the boat is priced in US dollars (as most boats are even a lot of them that are for sale in Canada), then I have to covert to Canadian dollars (an increase in price of 32% - changes day to day), then add 10% duty, followed by 12% sales tax on the total (so tax on the duty)!
So, for example, a $250,000 US boat ends up costing approximately $410,000 Can. after taxes, duties, and exchange. In this example, the duty added about $37,000 Can. to the end cost.

Will this affect Canadian boat buyers, with the spin offs into other aspects of the marine industry, I would think so. Could that have a negative impact on US boat builders, maybe!
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Old 12-19-2018, 10:43 PM   #35
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Foreign built boats imported onto Canada are taxed at 10% or more where as foreign boats imported into the US are taxed and 1.5% or less and in some cases zero.
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Old 12-19-2018, 10:48 PM   #36
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Foreign built boats imported onto Canada are taxed at 10% or more where as foreign boats imported into the US are taxed and 1.5% or less and in some cases zero.
Boats imported into the US from China today now carry an import duty of 10% (Not the entire purchase price, but of certain items and materials in the build)

That was set to go to 25% Jan 1, 2019, but has now been delayed 90 days to allow negotiations to continue between the US and China.

The days of 1.5% are over....
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Old 12-20-2018, 01:55 AM   #37
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Over for China perhaps, at least for this week, but not for the rest of the world's boat builders.
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Old 12-20-2018, 12:24 PM   #38
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So I wonder if MV Mahalo had a tariff tax assessed?
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Old 12-20-2018, 12:38 PM   #39
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My thoughts would be deemed political, so I will bite my tongue.
Well, we knew, that sooner or later, somebody was going to keep their political thoughts to themselves!
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Old 12-20-2018, 01:51 PM   #40
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