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Go Back   SailNet Community > On Board > Boat Review and Purchase Forum > Buying new boats in this economic environment?
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Thread: Buying new boats in this economic environment? Reply to Thread
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Topic Review (Newest First)
02-10-2009 01:00 AM
yellowwducky My thought is trigger pulling lets say April 2010. Budgeting 8-12 months for a build gives me time to flog stuff, cut leases, keep on with lessons and when its complete, be pretty much lined up for setting off early 2011.

Of course, plans are just that but at the moment, that is what we are thinking. My hunch is I would still be thinking new or near new - we would be looking for a cat so 15-20 year old boats fully depreciated just are not really even available as much of an option. That, and I doubt the SO wants to get involved with that kind of a project.

So far, not having been on any I hasten to add, the boats I think of as candidates so far would be things like Outremer 49, Catana 4?, Atlantic 42 or 48, Leopards and maybe a FP. None of these are 'major builders' or in the case of Atlantics would be a custom builder. If you put a gun to my head right now, I like the Outremer 49 as the best compromise given my current understanding. ymmv of course!
02-09-2009 10:23 PM
danielgoldberg
Quote:
Originally Posted by yellowwducky View Post
Do you think builders are sitting on large amounts of inventory though Dan? I am not sure how the business works but I would think right now that without an order you wouldn't just be rattling off boats without orders. Sure you would make your show versions to get to the different venues but would there be piles of boats sitting in stock at Lagoon or Hanse or whoever?
Sorry for the delayed response.

Dealers DEFINITELY hold inventory. Most manufacturers require the dealers to hold a certain number of boats in various models in inventory. Believe me, go to a new boat dealer of any production line, and they have new boats in inventory. Note that I'm speaking of monohulls; I'm not sure if the multihull dealers work the same way.

And CD, Cowboys??!!! Aren't you in Texan country down there?
02-09-2009 06:29 PM
Cruisingdad One of the main reasons to buy new is that when things break (and they do, believe me), someone else fixes them. That may not be the case in the current environment.

You find that most dealers handle the warranty claims and many dealers may not be around if things don't change soon. Of course, the warranty goes through the manufacturer, but even they may struggle to get their parts from other companies if they are going broke. Remember, a sailboat is 99% other peoples products. And why buy new if you have to turn around and put it on yourself?? You will find that a new boat WILL have problems... period. Many of these things seem to want to break in the first 90 days if they are going to fail.

The other benefit of buying new is that you know what has been done to your boat, and what has not. Assuming what you get is as good of a product as the boat before it, that should be fine. However, I doubt any of us know what to expect to be coming out of these companies anymore.

I bet you would be fine with a beneteau or a Catalina. They probably have enough resources and finances to see through these things longer than most. More specialty builders may have more of a problem as their customer base (and likely total income) is less. As far as the Hinkleys/Swan's of the world... I have always wondered if they would even know there is a bad economy. I honestly do not know.

The used market is actually doing pretty well right now. I know several Catalinas and apparently Bene's are holding or increasing their value right now. Depends on the models, I guess.

My theory on boats and te future... it is worth what you are about to pay for it:

I believe this year and next will see massive failures of boat companies, suppliers, third party manufacturers and others. I think a massive percentage of the dealers will go out of business. I think more now than ever, those companies that survive will directly market their boats to control their own costs.

I suspect that in 12 months you will see massvie numbers of boats on the market that were repo'd by the banks. THe banks will offer to sell them for cut rate prices and will offer them for LESS than they have in them... maybe much less. However, I believe that many of these boats will be severly neglected and serious need of maintenance. I mean come on, if you are going to let your boat go to repo, you certainly are not going to be changing the oil every 100 hours!! SO I believe it will be "Buyer Beware" on these boats.

I believe that many of the best boats will be the used boats that are directly sold by the seller or maybe broker. They will cost more than the repo'd boats of the banks, but in much better shape. They will cost a bit less than the new boats coming off the line directly from the manufacturers, but they will be better made and in the long run a better value. I think these boats will be harder to find but will see it through the economic crisis and beyond.

Those are my thoughts. But then again, I thought the Cowboys would go to the Superbowl, so my predictions have not been great lately!!!

Brian
02-09-2009 03:18 PM
rigamarole You can't always get what you want
You can't always get what you want
You can't always get what you want
But if you try sometimes you might find
You get what you need
02-09-2009 03:15 PM
rigamarole YD, Second quarter of 10 isn't that far away. I don't know your price range but new boats would require pulling the trigger now and used is about 4 months from offer to close. My situation is that I need a boat right now like I need VD but sometimes the opportunity is too good to pass up. (analogy, you get screwed with both)

One example of taking advantage of a market is Henry Ford. People think he became rich from selling cars, which he did. But his real wealth came during the depression when he bought the complete pipeline of assets needed to make a car for pennys on the dollar. This hopefully will be as close as we come to a depression in my lifetime and when opertunity knocks, I'm answering.
02-09-2009 02:51 PM
tommays Well

I think that many 401K type people have lost so much of there savings and now have it fresh in there minds how fast things can get BAD, that even if we recovered in a year it will take much longer for people to feel comfortable enough to commit to a BIG ticket item for that they WANT but dont NEED


And buying things we WANT on borrowed money is the root cause of the mess
02-09-2009 02:32 PM
CBinRI
Quote:
Originally Posted by yellowwducky View Post
Hi all,

I am curious what people think about the risk of this these days. We all know markets globally are terrible. Boat builders are on the ropes. Now maybe this bodes well for getting some good prices. On the flip side though, I see the risk that you get xyz co started on your boat and 3 months into it the company is out of business. What do you do then?

For instance, Poncin Yachts is currently working under creditor protection (extended to May 31 2009). So if you were thinking of getting one their new Catana's which are fairly popular cats, would you be happy placing an order for one? Now they mentioned in a press release that they got a few boats sold at the Paris boat show and thats great - but what are those buyers doing to protect themselves that a boat can even get completed?

I am not picking on Poncin/Catana here, it is just one that I know is operating under creditor protection as it is a public company.

So, you find your dream boat, its new, shiny and has everything you think you would like. Do you risk it in this world with a builder? How do you protect yourself? How do you know whats going on when it isn't even a public company (like Poncin). For instance, I quite like the look of the new Outremer 49. Well how the heck do you know what is going on financially there to ensure you would get your boat completed? What kind of contracts do people need to get put in place to protect themselves?
I am the wrong person to ask as I am not a big believer in buying a new sailboat in even the best of times. My general feeling is that with a bit of patience, one can do so much better used.
02-09-2009 01:31 PM
Valiente
Quote:
Originally Posted by yellowwducky View Post
To clariy - when I say 'realistically, this is a very small to medium amount of your annual budget' I was specifically meaning the difference between the two numbers ie 8,000. If you have the budget to eat around 28k or 36k the difference is likely not killing you. Of course, this math could be off as I pulled the end values of the boats pretty much out of thin air. But it has to be admitted it would be easier to sell the 10 year old cat than the by then 15 year old cat.
You could go the other route and try to source a throughly depreciated boat (say, 10 years old) that surveys impeccably due to low and conservative use.

In other words, assuming everything but the engines (maybe!) on a 1998-9 otherwise beautiful boat is in need of replacement, and argue the price down from there with the assumption that all the electronics, some of the wiring and some of the plumbing will be replaced and that the engines may require mid-life service.

We pay a great deal for style and the perception of style, but in some cases, the best or most logical design of a type has already been produced, particularly in a relatively conservative area of design as small yachts. There are many examples of 25 year old designs that have been merely tweaked or updated in terms of trim or electrics and still find an audience.

My point is that the middle distance of the used market holds more bargains than the "newly used" primarily on the basis of perception and the desire of the dealer to recoup the initial cost as much as possible, whereas a 10 year old boat owner knows that his boat (even if it has been only daysailed 20 times and maintained and serviced religiously by marina staff in that period) will labour under the impression of "old, out of fashion" and will be priced accordingly.

The next step, of course, is "classic", at which point the boat will hold or increase its value somewhat based on reputation and whether or not someone does a circ and writes a book praises some otherwise unremarkable 1988 cruiser...
02-09-2009 12:21 PM
yellowwducky Unfortunately for me, the earliest I see actually seriously thinking of being in the market isn't until closer to early second quarter 2010.
02-09-2009 11:05 AM
rigamarole True - the asking price is high on boats. I'm looking for a Bahia right now. Fountaine Pajot still has a brand new, never floated 2006 in La Rochelle for less then some of the 2004 boats listed. The difference to me is the sell price discount. In good years, boats typically sold for 20% less then asking price. While it's a pure guess, I'm planning on paying 40 to 50% less then asking. With a new boat, there isn't a discount or maybe 10%. Time will tell for me but luckly I have time and some sellers may not.
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