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Go Back   SailNet Community > General Interest > General Discussion (sailing related)
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  #11  
Old 05-24-2007
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Jeff...I think what you've said sounds reasonable...particularly the part about competing with your own boats. I still think there is a market for traditional boats that haven't changed much and appeal to a particular buyer (PSC, Hans Christian, Valiant etc.) but it is a limited market and getting smaller as people opt for larger and roomier designs for blue-water cruising...(Hylas/Passport/Tayana etc.) and you can build a larger custom boat overseas for the same or less than a PSC built in California. Hopping aboard a Hylas at a boat show vs. a PSC38 for about the same bucks is not gonna sell a lot of PSC's. I agree...they need some new boats without compromising the integrity of their build quality/reputation. But I guess I'm wondering if you can still buid a sub-45 foot line of semicustom boats and survive.
The Saga's on the other hand are quite modern in design and construction and they got into trouble as well so I don't know what the issue is there. One company and two "sinking ships"!
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Old 05-25-2007
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I am not sure if the following analogy is relevant to the discussion, but here goes. It does give a nod to Jeff's point.

In the east coast sports car market, whenever Porsche would come out with the latest "new" version of the venerable 911 there would be a huge rush of orders for the car. Many, if not most, of these orders were from current 911 owners and many of those had 911 that were only a year or two old. But that year or two old 911 was no longer the "latest" and we could n't have that now could we? The beneficieries of this phenomena were those astute used car buyers who had nothing against driving a car 1-2 years old that they purchased for less than half the new cost. Inherent in all of this is the perception that the new model is demonstrably superior to the old. It doesn't have to be, but it better be perceived as being so. Buyers of high end products, be they sailboats or Porsches are notoiously fickle. They seem to tend towards buying the "latest", ignoring the "classic". And, I suspect, this characteristic is predominant in the new boat market, at the higher end. Chevy and Catalina do not have this problem.(g)

One of the solutions to this phenomena, as discovered by Jaguar, is to raise prices. Why would raising the price on a dated product be an advantage? Well, it seems to work out that the people who have the money to buy these high end products new, as well as turn them over in a couple of years, have a very strong identification of quality and exclusivity, with cost. Jaguar was advised to raise the price of the tired old XJ-S and XJ-6. As I recall, they went from about $30,000 to up around $38,000, maybe even closer to forty. And sales increased. Same old car.

Perception is much more important than reality.
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  #13  
Old 05-25-2007
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I think that we're entering the age of Catalina. While there are more and more people buying boats, and living on them for extended periods, I don't think very many of those people have any intention of sailing off across the Atlantic.

When Pacific Seacraft started selling boats, there were fewer companies making large, offshore cruising boats. There were scores of options for people wanting something under 30 feet, not as many for those loking for 35 footers.

As the boomers have aged, their buying power has increased. 30 footers are entry-level boats now, and there are hundreds of 40 foot boats sold every year.

While a significant portion of the bigger boats are being bought by long-term sailors, it seems that there are just as many first-time buyers in that market as seasoned yachtsmen. For the first timer who is planning on spending four months a year on a boat in the islands, a Pacific Seacraft yacht is a waste of money, and for the others who are planning on voyaging, there is a whole lot more competition out there than there used to be.

Certainly the quality of the boats is top-tier and they are capable sea boats, but so are many others. And they have been selling the same boats for a long time....

I hope they survive. They seem to be a manufacturer with a certain amount of integrity, but, I think Sailaway raised a good point, hence I also hope that they start producing models that are a little more contemporary ... and that they get a bit more aggressive about marketing them

Last edited by Sailormann; 05-25-2007 at 01:03 AM.
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Old 05-25-2007
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PSC boats are my favorites, but I can't afford a large enough used one.

I think that one of their major expenses and burdens is doing business in California. One of their biggest expenses is wages and pensions. Ca workers demand the most, even their large number of Mexican American employees. Workmans comp costs are huge in CA. CALOSHA looks at them with a magnifing glass. Enviromental safety costs more in Ca, shipping is more in Ca, fuel/energy is more in Ca, rent/property is more,...etc you name it.

My family used to manufacture machinery in Ca, but in the 80s we lost out to China. So through the last 20 years we went to anodizing, plating, & military painting. Now it's impossible to do in Ca., it's all gone to Nevada or Mexico. In So Cal EVERYTHING is monitored; it's tough to dry sand or spray anything. We're right next to Tijuana, Mx and they can do anything. Chromimum, lead, acid, no problem. It's the same air over head only a fence in between. If PSC moved 100 miles South they could drop their price 25%. Should they? Heck no! One of the reasons I admire PSC is their quality and their locality. For now I'll keep sailing my Cananian cutter and keep saving for my new used PSC because I fancy high end stuff.

Catalinas were from California; how much longer before they're all from florida? After that, why not build them in Mexico and really cut costs?
Chris
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Old 05-25-2007
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I hope PS makes it out of Chp. 11 intact. They do make some very nice boats... and that may be part of their problem, since the boats are basically the same ones that they've been making for ever...
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  #16  
Old 05-25-2007
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Quote:
Originally Posted by Sailormann
I think that we're entering the age of Catalina. While there are more and more people buying boats, and living on them for extended periods, I don't think very many of those people have any intention of sailing off across the Atlantic.
I completely agree with this. As we have become more affluent as a society, we buy things that enhance our time not spent working- recreation, if you will. If I had wanted a boat for a liveaboard or weekends and vacation time only, there is no way I would have bought a PSC. A Catalina would have been a much better- and considerably less expensive- choice. I want to cross oceans so for me, the choice came down to PSC or Valiant.

With the new 38 design, it appeares that PSC is exploring a different market segment. I bought my boat through a broker that deals in new PSC's and I know the 38 was going to come in at $400K minimum- a lot of money. How many boats does Morris sell, I wonder...

Wendy
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  #17  
Old 05-25-2007
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Quote:
How many boats does Morris sell, I wonder...
I don't think that they do much volume - and they are also operating a brokerage. I'll go out on a limb here and suggest that the used boats represent an important part of their income... Otherwise I don't think that they would be doing it. It's a difficult business (too many customers like me).


This is another casualty that really surprised me. I had thought that the cutters would be selling well...
Quote:
It is with great regret that the Sam L Morse Company has decided to discontinued production of the Bristol Channel Cutter and the Falmouth Cutter.

The molds and patterns to produce these outstanding boats, together with the rights to manufacture the boats are now for sale.

The purchase price for all molds, patterns and exclusive manufacturing rights is US$50,000 FOB Costa Mesa, California.

Anyone interested in this opportunity should contact Sumio Oya at info@samlmorse.com

The Sam L. Morse Company wish to than you all for your support over the years.
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  #18  
Old 05-25-2007
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Again this is almost the same problem only worse. The BCC started out as a very limited production kitboat. The fact that it has remained in production for 30 plus years is amazing to me considering that nealry constant rumors have suggested that Morse has been teetering on the edge for that entire period.

BCC is aneven more extreme case in that the PSC's at least improved in quality and added a couple new boats to their line-up. It is really hard to imagine paying $250-300K for a 28 footer than you can buy used for as little as $30K.

Jeff
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Old 05-25-2007
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This has been disected pretty well, with a lot of thought on what and why. I think that Sailorman is probably closer to the truth here in that the majority of people that are entering the market are not doing so to cross oceans. It is more about a second home that you can sail than about living aboard forever. You don't need a PSC to cruise around the Chesapeake or Lake Michigan. At times in some conditions you might wish you had one, but it is a lot less expensive to just sit out the weather than buy a boat that is over built for your intended purpose.

The suggestion to change the models and market more aggressively could be a good one in a market that is growing fast and where money floods in. In a niche market such as PSC, which has operated close to the edge for quite some time, finding that money can be very difficult. Spending it is easy.

At the end of the line, it could just be that they were not well run. A great product, but a business model relies on more than just a great product. The fact that they are in California, as suggested by someone else here, has to be to their disadvantage. However, leaving Ca. could lose them the tradesman that made the boat great in the first place. Damned if you do, damned if you don't. Survival would probably mean leaving the state.

I cannot imaging myself ever being in the market for a PSC, but it would be nice to see them survive. If not, there are a lot of used on the market that will continue to cross oceans, and probably a few that will never leave the confines of a small cruising ground.
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Old 05-25-2007
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Valiants (the PSC twin) has survived (at least for the time being).

They are made in Gordonville, TX. Where??? you ask.

On a big lake in North Texas. The cost of living is extraordinarily low. The rent (do not own... as I recall!!!) the land they are made at. Super boats, and a better business plan making them somewhere that has a low cost of living, low wages, inland (good and bad), and a nice sailing community. If I was PSC, I would move to Lake Texoma. You could pull some of the working talent off of Valiant and still produce your product.

All that aside, I will tell you why they went down the tubes. I think they make an awesome boat... top notch. So does Valiant. As I have said countless times before, if you do not think there is a difference between a Valiant/PSC and a Catalina, you have never seen one or you are blind. BUT THEY ARE VERY SMALL AND CRAMPED! compared to similair size production vessel (I will use Catalina as the example here on out).

I know it was mentioned to make different model changes, etc. But I dissagree with that. One of Catalina and Valiants saving graces is that the employees working on them have made so many of the exact same boats that they can do it quickly and efficently. Boats are not like cars and small changes have huge ripple effects down the lines. I know this first hand in speaking with Catalina Mfg. Why don't you think Catalina wants to do anything custom?? THERE IS A MARKET FOR IT, big time!!!! However, the slightest change stops mfg from there back. Those little custom things kill you.

How do you save PSC?? Like Cam inferred, you change the mold and design. Look at our society. Look at our boats. Look at what sells: TV's, refrigeration, water makers, lounge chairs in the salon, big comfortable sleeping areas. Look how unpopular a pullman is today versus years ago (now everyone wants the walk-around queen/kings).

I do not fault people for this. Comfort is not a bad thing. Hylas has found a way around it, as has Oyster, Taswell, Tayana, and other manufacturers. Yet, PSC and Valiant are great examples of go-anywhere boats that are tight and uncomfortable. I don't think they have stayed up with trends or the times.

Put me in a serious offshore storm (like the one off Hatteras a week ago) or a hurricane... give me a PSC or Valiant. As for the rest of the time, a Hylas. Since I have always gone to great lengths to avoid survival storm conditions, give me a Tayana, a Hylas, a Taswell... a boat that is comfortable AND safe for going anywhere.

That is why they are bankrupt. There are other boats you can go anywhere that are modern AND comfortable.

Just a little interesting sidenote:

As many know, a few years back I was seriously shopping for a trawler. I had narrowed it down to Krogen and Nordhavn. I was approached by Steve Wallace (the service mgr for Valiant) who wanted to build me a Valiant Trawler instead. THere was another owner having them do the same thing. I was interested.

After some months of back and forth, I received dead silence. I called Steve to find out what had happend. He told me they scrapped the whole plan. No trawlers. Why?? He said they could not produce them anywhere near the cost they would be able to sell them at (comparable to a new Nordhavn) so trashed the whole idea. Told me to go buy a Nord or Krogen.

The cost of change in the boating world is considerable. Make a mold that is flexible, plan ahead for the future, follow the trends, and keep up with the times. Yet, as a business owner, I will tell you this is not just true with boats... it is business in general. Don't believe me? Ask Ford or GM.

- CD

PS I mean NO dissrespect for the PSC or Valiant owners. They really are top notch boats. If you can deal with the space, they are awesome boats and will keep you safe for the horizons ahead. You did not make a bad decision.
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