Depreciation of a Beneteau!

[Tranona]

Ouch! Should have got a Dragonfly

It was the price of vanity - in a different way. The person who commissioned the boat had very clear views about what he wanted so he engaged a very expensive designer who tried out a lot of new (at the time) ideas, had it built by a small builder out of exotic materials and filled it with complicated systems. Fortunately most of it worked and many of the ideas ended up in production boats. However a subsequent owner rather neglected it and any potential buyer would be looking for perfection rather than a monster refit bill to get it up to scratch. Given that the number of potential buyers looking for an exotic boat is already small, the number looking for a project as well is even smaller. Therefore low price - but a bargain for somebody with the skill and patience to do the job.

 

[Zagato]

Well it all makes a 22' Drascombe Drifter @ 30K and a new 25' Folkboat @ 40K look incredible value for money I know there are fewer materials, no engine, less labour intensive spec and pricey gizmos but to whack on another 100K+ for another 8' seems crazy - it just shows how much the overheads etc increase for the big players and how much of an increased profit margin they have to charge to sustain the whole operation. You get a nice boat but I don't belive you get value for money. 500K + for some of these larger Mobo's is certainly not value for money!

 

[Twister_Ken]

Well it all makes a 22' Drascombe Drifter @ 30K and a new 25' Folkboat @ 40K look incredible value for money I know there are fewer materials, no engine, less labour intensive spec and pricey gizmos but to whack on another 100K+ for another 8' seems crazy - it just shows how much the overheads etc increase for the big players and how much of an increased profit margin they have to charge to sustain the whole operation. You get a nice boat but I don't belive you get value for money. 500K + for some of these larger Mobo's is certainly not value for money!

You're labouring under a delusion. The size of a boat doesn't increase by the length x 1, but by length cubed. Thus, a 32 foot boat cubed is 32,768 cuft, whereas a 22 footer is 10,648. Thus, a 32 footer should be approx 3 times the price of a 22'. Guess what? It is.

 

[Tranona]

Agree with Ken that it is cube that determines cost change. Costs are largely a function of displacement. To prove it just take the 30-40 ft range of a popular builder such as Bavaria or Beneteau where the boats are essentially the same but progressively larger.

A Bavaria 32 has a displacement of 5200kg and a base price of £50k
A Bavaria 36 has a displacement of 7000kg and a base price of £75k
A Bavaria 40 has a displacement of 8680kg and a base price of £100k

The price/cost per kg rises slightly because the larger boat usually has more goodies, such as twin wheels etc.

Conversely a 28 ft would be more per kilo than a 32 because many of the expensive bits such as engines, steering gear etc are much the same.

You can calculate the % changes and price per kg and draw your own conclusions

 

[Zagato]

4', cubed, largely of air is another 25K more - OUCH!

 

[Tranona]

4', cubed, largely of air is another 25K more - OUCH!

Look very closely at the figures and you might begin to understand!

4 foot extra length is between 1500 and 2000 kg additional material - more of everything and bigger of everything - not just air.

Suggest you go in each of the three sizes - they are alongside eachother at boat shows to appreciate the differences.

 

[Phoenix of Hamble]

Agree completely.... 6mm to 8mm rigging wire... 32 to 40 speed winches... 8mm to 10mm halyards.... bigger battery banks... larger section mast... bigger sails... longer and bigger track cars... the list is endless

You don't just add 4' of glass, you need to add extra scale and strength in all the componentry... and on top of that, the extra structural strength needed to support a desk stepped mast with a 7' wide coach roof versus a 5' 6" wide coachroof is huge...

I guess that we could list off extra costs for days...

 

[Zagato]

I can see your point but not 25K worth. It is hard to see how 4' extra costs the same as a complete new 22' boat which you are building from scratch with the TOTAL labour of the build included. I wonder how much longer it takes to build a 30' boat as opposed to a 34' boat! Nowhere near as much as building a new22' boat from scratch with all it's components. When you talk about bigger winches the labour and raw product will be similar in quantity but I bet there will be a massive price difference between the two.

Everything is hoicked up because the market is for the wealthy customer!

 

[PeterGibbs]

I have spent a while this afternoon reading threads from roughly 10 years ago. I am new to boat market prices but it seems that some marques have hardly depreciated at all in this time e.g. Contessa's, Saddler's etc. They are still selling at 30-40K. I maybe wrong but this seems to be the same rough price bracket as 10 years ago!

Question, how much is a New Beneteau of roughly 32' new and how much will it lose in a 5 year, 10 year and 20 year period if they go back that far?

Contest’s, Saddlers and most Westerly in this size range and dating from ’70 and ‘80s have a strong following based on reputation and getting (most) of your money back when traded. But they are getting on - the price is really for the hulls which have so far retained their integrity; most purchasers would accept that vessels of this age will incur ongoing expense in almost all departments as gear comes to the end of its life.

But a boat in its first 10 years should not suffer handling equipment replacement costs; sails will have to be replaced of course. That does not mean that electronics have any value at 10 years even if they are still reasonably reliable; apart from obsolescence a wise buyer will allow for incipient failure and incompatibility with new gear. Belpw decks gear failure at the 10 year mark is a pretty good yardstick.

Re-interpreting your question: buy new or 10 years old? If new, whilst it's not as disastrous as the depreciation on a car as it leaves the showroom, mentally write off on day one the "perishables" and the not inconsiderable commissioning costs (hull prep / A/F / etc) - perhaps as much as 10% of invoice price. The hull and rigging should retain value over your 10 year period, but the rest of the fixtures - water and heating systems etc, - are subject to increasing loss as the years proceed and will need to be allowed for, perhaps to another 10% of new value. On the positive side, engines and stern gear should deliver 20+ years if properly maintained.

Completing this calculation gives you a reasonable cost per year in write downs and replacements on a new boat. But having done it both ways, pre-used and new, there is nothing quite like taking delivery of your very own new boat and forging that relationship which can never be quite the same when the boat had previous owners. How do you put a value on that?

PWG

 

[Twister_Ken]

I can see your point but not 25K worth. It is hard to see how 4' extra costs the same as a complete new 22' boat which you are building from scratch with the TOTAL labour of the build included. I wonder how much longer it takes to build a 30' boat as opposed to a 34' boat! Nowhere near as much as building a new22' boat from scratch with all it's components. When you talk about bigger winches the labour and raw product will be similar in quantity but I bet there will be a massive price difference between the two.

Everything is hoicked up because the market is for the wealthy customer!

If you don't get, well, you don't get it.

 

[Tranona]

I can see your point but not 25K worth. It is hard to see how 4' extra costs the same as a complete new 22' boat which you are building from scratch with the TOTAL labour of the build included. I wonder how much longer it takes to build a 30' boat as opposed to a 34' boat! Nowhere near as much as building a new22' boat from scratch with all it's components. When you talk about bigger winches the labour and raw product will be similar in quantity but I bet there will be a massive price difference between the two.

Everything is hoicked up because the market is for the wealthy customer!

Sorry, absolute rubbish! Materials cost are related to weight, so if you increase weight you increase cost. Nothing to do with "wealthy" customers but simple laws of physics and economics.

Suggest if you think you can defy those you try to be a boat builder and see how long you survive.

 

[Bosun Higgs]

What explains the rise in the last few months?

Bubble. But of course like every previous bubble from tec shares to tulips, the supporters say "this time its different".

Same thing happening in gold. And when the economic crisis settles down, as it will, then people will no longer be trying to hide money in commodities and will go back to bank accounts and paper money.

So if you have silver or gold, get rid now. It may well not be the top, but the secret of good investing has always been to get out early leaving something for the next man.

Anyone want to buy some krugerrands? Private transaction so no vat

 

[Bosun Higgs]

Everything is hoicked up because the market is for the wealthy customer!

There is some truth in that but not in the way you think. Almost all the big manufacturers dont make small boats because there is no money in it. The flash manufacturers and even Bav go bigger every year because that allows them to charge a price which at least covers their costs. Not that it stops them from going bust and having to sell out.

To make your suspicions work there would need to be a cartel, and there are far too many makers involved from far too many countries to make a cartel work.

 

[Zagato]

Sorry, absolute rubbish! Materials cost are related to weight, so if you increase weight you increase cost. Nothing to do with "wealthy" customers but simple laws of physics and economics.

Suggest if you think you can defy those you try to be a boat builder and see how long you survive.

Mmm, yes, thanks for that Tranona...............

 

[Phoenix of Hamble]

I can see your point but not 25K worth. It is hard to see how 4' extra costs the same as a complete new 22' boat which you are building from scratch with the TOTAL labour of the build included. I wonder how much longer it takes to build a 30' boat as opposed to a 34' boat! Nowhere near as much as building a new22' boat from scratch with all it's components. When you talk about bigger winches the labour and raw product will be similar in quantity but I bet there will be a massive price difference between the two.

Everything is hoicked up because the market is for the wealthy customer!

What you don't seem to get is that the extra 4' doesn't mean just an extra 4' worth of materials... the other 32 to 36' or so also need to be substantially bigger.... ask anyone who has moved up from a boat to the next 'step' up about the extra effort involved in polishing the topsides or applying the antifoul... the difference in surface area between a 32 and 36 is enormous and the difference between a 36' and 40' even more so.... just the keel alone will have perhaps an extra 1000kg of material in it, which isn't an insignicant amount... and then you need a bigger crane/lift/tractor/trolly to move it around, etc etc

Also, the size of engineering involved in things like winches, deck fittings etc goes up exponentially... where the winch for a 30'er might be say £400, the equivalent for a 40' is £1500... sounds like profiteering, which it might be a bit, but if you actually look at the two products side by side you'll see some pretty substantial differences in the engineering strength needed...

so to take your point again.... you'll probably find that the weight of raw materials involved in adding 4' to a 36'er is not dissimilar to the entire weight of materials for a 22'er by the time you've discounted things like engines

 

[Zagato]

Thanks Bosun and Morgana for your responses. I understand the weight differences of course, in fact the weight of the 30K 22' boat IS 1500KG but with the added extra of total labour to build a boat from scratch the material costs alone don't justify the massive increased cost for the equivalent of 4', cubic, weight.......... As said I can understand the increased cost but not by this much.

Morgana your price difference in the winches alone reinforces my example. The weight of raw materials and extra cost to build them surely cannot justify an £1100 increase when you can make one for £400. How much bigger or complex is the thing As said I don't think you are getting value for money and I still suspect prices are being hoicked up because you are dealing with wealthy customers. The majority of business separate their prestige products by more than it costs them to make them, of course, generally human behaviour is to show off financially and boats are probably the closest example of this alongside property and cars.

The larger boat companies cannot afford to make smaller boats as they will have massive overheads etc but many small companies do survive very well knocking out 22' boats on a low volume scale.

As said I don't think you are getting value for money.

 

[Twister_Ken]

You're unwilling to understand because you're unwilling to understand.

But I'll have one more try. Consider moulding one side of the hull of your 22 footer. And, for the sake of simplicity, consider the hull side to be a rectangle 22 feet long and 6 feet from centre line to gunwale. That's 132 sqft of moulding. Now apply the same to a 32 footer, and call it 9 feet from centre line to gunwale (beamier, higher topsides). That's 288 sqft of moulding. Apart from square area, the bigger boat probably has more thickness (has to sustain greater loads) so well over double the material and labour.

The same principle will apply to the deck moulding, the keel, the interior build. Your 22 footer may have 2 man-sized berths, the 32 footer will have six. Your 22 footer won't have pressurised H&C water, or a shower or a holding tank. The 32 footer will. And so it goes on, including RCD compliance (a small boat will have a lower compliance standard and has to contain less 'RCD engineering' than a bigger one). That, in essence is why costs appear to go up wildly with length, but consider the sums and it makes sense.

 

[Otter]

and:
Muddy Paws
A new Contessa 32 would be in the region of £150,000, provided you did not overdo it on the extras list.

WHAT???!!! A pretty good but hardly amazing sea boat; wet narrow and cramped; no loo except one in the only sleeping compartment - and £150k to buy - the cost of two Ben/Jen/Bav 31's that sail well. And it transpires the Con and the Ben both depreciate the same

How come YM are always pushing the Con?

 

[Phoenix of Hamble]

Morgana your price difference in the winches alone reinforces my example. The weight of raw materials and extra cost to build them surely cannot justify an £1100 increase when you can make one for £400. How much bigger or complex is the thing As said I don't think you are getting value for money and I still suspect prices are being hoicked up because you are dealing with wealthy customers. The majority of business separate their prestige products by more than it costs them to make them, of course, generally human behaviour is to show off financially and boats are probably the closest example of this alongside property and cars.

.

As said I don't think you are getting value for money.

Sigh.... go look at them... they are physically twice the size, and suddenly need to have bearings made from exotic materials rather than harderned steels... the machining is on heavy guage, and needs more expensive machinery etc... on a 22'er, in 5kts of wind you can hold the genoa sheets by hand.... on a 36'er you'd be pulled out of the cockpit faster than you could yell 'Oh ****'

As Ken said... you seem determined to stick to what you believe, despite the much repeated advice above from many people who have owned boats of all shapes and sizes who are telling you that you are wrong. C'est la vie.

 

[Zagato]

As said, I understanding where you are all coming from, it is the value for money part that does not add up to me - do you see what I mean yet?

Let me give you an extreme example first, the cost of production of a small car in the third world is apparently 2.5K. They sell it in their country for 4k and you can even buy it over hear for 7K - THAT is a lot of winches

Over hear if we are using british labour rates you can build a whole car for between 25-30k admitedly the engine and geabox would have to be reconditioned, but everything else is pretty well brand new. There is roughly 5months of work involved. It doesn't take an extra 5 months to make a 36' over a 32' and their are a lot more parts in car than the extra 4', cubic, weight zzzz in a boat. How much does a tonne of raw material of GRP cost, not that much!

So going back to the boat 4' and 1500 -1800KG with a bog and shower thrown in etc Does it REALLY cost 25K extra...ouch! Hopefully the the lesser boat has a bog and shower already in it for that price!!

The 31' Benetau costs roughly 2.6K per foot to buy so an extra 4' should be 11K surely
,
The 37' Benetau costs roughly 3.1K per foot to buy, so an extra 4' should cost 13K surely. Now those figures could be justified.....