If you had to replace everything

[lustyd]

How much would it cost to replace every part on your boat, but not by buying a new boat? I was looking at new running rigging today and it will cost more than I sold the old boat for, and half of it is made from recycled bottles. I've also been looking at blocks, a lock, cushions, electrics. Individually everything seems a little pricey but largely reasonable. Added up though it's very quickly a bit bonkers!
I actually think if I replaced everything it would be about three times the cost of an equivalent new boat.

 

[newtothis]

About 20 years ago a motorcycle magazine priced building a fairly average mid-range road bike from parts. I think the bike was around £5k on the road but built of parts cost closer to $40k.

 

[Buck Turgidson]

my baby Blake would cost 5 grand to replace!!!

 

[LONG_KEELER]

my baby Blake would cost 5 grand to replace!!!

Seems to be around the same price my new teeth are going to cost.

They were free when I first started out though.

 

[Concerto]

The world of manufacturing is about the selling price of an complex item like a crane. It may be sold at a loss over building cost as the profit comes over time with spare parts that cannot be bought anywhere else. The profit margins can be many multiples of the cost of manufacturing to cover the cost of holding them in stock. I remember talking with a wholesaler to the DIY industry, the fastest selling items like expanding tapes they added 65% to their buying in price, whereas the slower selling items could have 300% to 400% added.

So lustyd, you are right the sum of the components will always exceed the cost of the whole of a secondhand yacht. That is why the advice is always to buy the best condition secondhand yacht as it will work out cheaper than a fixer upper. Also remember that a manufacturer is buying direct from manufacturers, not from retailers, so this rule also applies to new craft, one of the reasons the fitting out of hull and deck mouldings by amateurs has stopped.

 

[Lucy52]

A long while ago a friend worked at Renault head office, they were making sixty percent of their profits from replacement parts. That was on a schedule as they knew how long on average before a replacement part would be needed.
Also new items are priced as "sales" which is part of marketing, replacement parts are priced as "parts" which is a service cost, a different cost and mark up.
Most car dealers make their profit on the sale of finance, aka personal contract hire not on the car.

 

[mjcoon]

Seems to be around the same price my new teeth are going to cost.

They were free when I first started out though.

But it takes ages to get a first issue of teeth, and then it turns out they are only temporary!

 

[Stemar]

A long while ago a friend worked at Renault head office, they were making sixty percent of their profits from replacement parts. That was on a schedule as they knew how long on average before a replacement part would be needed.
Also new items are priced as "sales" which is part of marketing, replacement parts are priced as "parts" which is a service cost, a different cost and mark up.
Most car dealers make their profit on the sale of finance, aka personal contract hire not on the car.

That was my experience working for the French importers of Toyota cars nearly 40 years ago. There was a break point at around the Renault 16 and similar - maybe the Rover 2000 in the UK. Cars below that price range were built cheaply and sold cheaply; profit came from sales of spares. Above that point, there was some profit in the sale, but still far more from parts.

I've a vague recollection of reading about someone who loved their Morris Minor so much that when it died, and he couldn't buy a new one, which must have been the late 60s or early 70s, he had one assembled from parts. An £800 car cost him over £3,000.

 

[Gary Fox]

If you are able to search and find used parts, refitting a yacht wouldn't be too bad. It's the VAT, yacht tax and newness which has skewed the OP's assessment.
Yes parts make profit, luckily my 30 yr old Audi never needs any, unlike new ones.

 

[lustyd]

Yes I definitely think it's tax and duty at the root of a lot of this as well as marine markup. Thankfully I'm not really refitting, just replacing a few things proactively because they're a bit old or worn. A lot of the old bits will stay on board as spares. The thing that blows my mind is the complex electronics are the most reasonably priced parts. The bits that have seen no development for decades and are cheap to manufacture are extortionate!

 

[Gary Fox]

Yes I definitely think it's tax and duty at the root of a lot of this as well as marine markup. Thankfully I'm not really refitting, just replacing a few things proactively because they're a bit old or worn. A lot of the old bits will stay on board as spares. The thing that blows my mind is the complex electronics are the most reasonably priced parts. The bits that have seen no development for decades and are cheap to manufacture are extortionate!

Yes well spotted; the very latest DSC/AIS radio, with all the trimmings, is the same price as taxing your car.
Meanwhile, a Chinese built sheet winch, made of recycled fridges, and using the same tech as a Halfords 1/2" drive ratchet, costs the same price as a car!

 

[Moodysailor]

I'm not sure I fully agree with the comparison between these items and complex machinery as the ROI comes from different sources for each. In complex sales (an area I have worked in for years), sometimes the margin on the initial sale is incredibly low if you know that the equipment will bring back revenue in service or /or spares throughout it's life.
One manufacturer I worked for made low single digit profit on wholegoods, but with a 35-yr life expectancy and over 600% margin on service items the goal was to get market penetration and make money back in the long run.
Boat builders are no different to anyone when it comes to economy of scale, so it will always be cheaper for them to "package" these items for cheaper than the sum of the parts - if they didn't then a lot more people would simply buy unfinished or partly finished boats and fit them out themselves. Mfrs know this, and the total aggregate profit is always worth it, so they negotiate hard to set the pricing accordingly or employ other tactics (such as proprietary equipment) to reduce this.
I'm also not sure about the tax & duty argument either (not disputing the rip off) as I think if this was a big factor we would see big disparity across markets (ie same boat sold in other markets as a kit). Typically market pricing is well coordinated across the global players now, and I know of some manufacturers who have had supply agreements with component companies that state they cannot sell product X at below a certain value for a number of years, in return for an minimum purchase agreement.
To me, it's simply a case of ROI. In the case of a block for example, one might expect to replace these 3 or maybe 4 times along the lifespan of a typical cruising yacht. There has to be significant profit on each unit sold to pay back the investment and marine parts simply aren't sold in sufficient quantities globally compared to elicit any real reduction in price. There are also no significant service, spares or other revenue that the manufacturer can generate so the entire profit has to be captured at the point of sale. The product lifecycle is increasingly smaller these days, so this exaggerates the problem (i.e higher prices for new kit).
I certainly won't argue that the 'marine markup', tax & duty do anything to help the cause, but I think it's more a case of a relatively small, captive market divided by the economy of scale.

One way around this employed by some of my cycling friends is to create a "buying club" where the club or a member opens an account with a shop or distributor and all other members order through this. The total volume of sales over a year is enough to get a decent discount, which is passed on to the members. It wouldn't be fair to the legitimate marine businesses who are struggling if everyone took this approach, but i'm sure a deal could be coordinated with the local chandlers by a club for example.

 

[lustyd]

It's funny you picked the block as an example. Most yachts you look at have at least one worn or broken block which is why I find it surprising that they aren't cheaper. Same with ropes, it would be easy for rope companies to make this a regular maintenance item but instead most yachts out there have quite old ragged ropes. I do get the low turnover point, but I find it odd that certain parts have not transitioned to higher turnover and lower cost. When it's £350 for one halyard or £500 for a chart plotter you really have to wonder!

 

[Moodysailor]

Haha - confirmation bias I think. I've just ordered & received a set of mainsheet blocks for ours so it was high on my mind! In our case though it was impossible to get the same type and model of block (the existing ones are probably 15 yrs old). From a manufacturing standpoint, a change in design would mean new costs for R&D, testing, tooling, manufacturing & QC process not to mention the hidden costs that are passed onto the consumer such as sponsorship and marketing. Hence the high price. I fully expect that when I need new mainsheet blocks in another 10-15 years these won't be available either, hence the product lifecycle repeats.

Please don't look at our halyards - running rigging is on our list but a chartplotter that failed in December took some of that budget Speaking of which, I really don't understand the price of rope, my feeling is that is one area where 'hobby tax' is applied..... it frustrates me!

 

[lustyd]

Yes I made a list and it's eyewatering for rope. I like new rope though so I'll replace them gradually. Currently frustrated that I can't order it all as I don't know the sizes that are on there. I just know it's not what's in the manual

 

[Moodysailor]

Same, working through ours slowly. Will aim for one a month once the bank balance recovers a bit

 

[V1701]

How much would it cost to replace every part on your boat, but not by buying a new boat? I was looking at new running rigging today and it will cost more than I sold the old boat for, and half of it is made from recycled bottles. I've also been looking at blocks, a lock, cushions, electrics. Individually everything seems a little pricey but largely reasonable. Added up though it's very quickly a bit bonkers!
I actually think if I replaced everything it would be about three times the cost of an equivalent new boat.

And it's also why"project boats" invariably cost more than it would have cost to buy one that's ready to go...

 

[rogerthebodger]

And it's also why"project boats" invariably cost more than it would have cost to buy one that's ready to go...

When people ask me how much did my project cost my answer is "I don't want to know", even without costing my time.

With the current exchange rate if I calculated today it would scare the living s***s out of me.

 

[Lightwave395]

I've long since given up counting the cost of anything my boat costs. If it needs something it usually gets it...

 

[Lucy52]

Of course you buy a boat at secondhand prices, the replacement parts are at today's new prices. You can buy a used Mercedes for £5,000 but the parts are priced at current new prices and like Volvo boat engine spares may seem eye watering relative to the small sum you paid for the car, or boat, which may have cost £30,000 or more new.