How has the pandemic, inflation, shipping costs, disrupted supply lines, energy costs and the war in Ukraine affected the boating market?

The state of the boating industry was the featured topic at Yacht Brokers of Marina del Rey’s most recent meeting in October. 

Bill Petersen of Denison Yachting in Marina del Rey says the marketplace remains strong for both brokerage and new boats. Inventory, which for me personally used to average 18 boats, has dwindled down to five or six. “I get a good boat and it’s gone,” says Petersen. “Things are turning around, I’m seeing a lot more listings coming in now than I have in the last two and a half years to three years. Sellers may be seeing this current market as their last opportunity to jump in.”

With the seller’s market and inflated prices during the past recent years, Petersen has seen multiple offers and sales over asking price. “That is starting to change.”

“Buyers are looking at the boats more closely, looking at comps and not overpaying.  So we’re getting back to an even market between buyer and seller.”

“The supply chain for the manufacturers has fallen behind. Manufacturers have orders coming in, they can’t get engines, so they ship the vessels to us without winches and toilets, knowing they can send these other items later.” 

“The Dufour boats we represent are loaded onto ships and are sold before they get here. We’re lucky to have these sold boats available to show people. When prospective buyers are interested, they ask, how do I get one? We tell them we have one coming in the spring.”

“Prices of new boats are high because costs of raw materials have increased. Everything in the supply lines have increased. Getting workers is tough— many have left boat building, and are now taking jobs making blades for wind turbines, which pays a lot more. All of this has helped inflate pricing on the used boat market.

“As new boats become more and more expensive, people look at a 46 footer that is maybe 2007 or 2008, maybe $ 275k or $300k. That same boat new will be double plus that price.

“New boats are limited because we are restricted to the amount of boats that we can actually get out of the factory. And when we attempt to bring new boats in from Europe, the European market takes ’em before we can. I’d say that brokerage boats are now 80% to 90% of our business.

“Also, the availability of slips is affected. Slips for boats 40 feet and above are more difficult to find. Even more scarce are the end ties, required for multihull vessels.”

In addition, the charter market extremely strong. Petersen mentions that Blue Pacific Yachting, also owned by Denison, “has been rock solid these past years.”

Currently a yacht consultant with Denison Yachting in Marina del Rey, Bill Petersen brings a lifetime of sailing, sailmaking, cruising and world class sail racing credentials, including participation in the victorious 1987 “America’s Cup” in Perth, Australia. Denison Yachting’s Marina del Rey office is both a brokerage for pre-owned yachts and a new-vessel dealership offering the brands Dufour, Excess Catamarans, and Seawind. 

Charles Devanneaux, founder of NAOS Yachts in Marina del Rey, says it’s really a kind of strange time right now. “People are putting deposits on boats that they don’t know when they will get, or at what point they are going to be required to pay for it. What we are seeing in the market are significant cost increases and also big price increases from manufacturer.” 

Sales of the higher end boats are still booming, says Devanneaux.  Catamarans and multihulls, used and new, are still in very high demand.

“The industry is still doing well on paper, and production lines are full, but for one reason, because production capacities have been reduced due to issues with supply. 

“Two factors affect why the industry produces less boats today than it used to: First, the shortage of material and components for the boat. And second, the ability to hire people. 

Boat manufacturers are suffering from a shortage of manpower. They compete for workers with the manufacturers of RVs, airplanes, high-speed trains, and giant 300-meter ships such as the six ordered by the shipping line MSC. Workers today can choose to work in many industries. 

80% of the boats are built basically on the west coast of France. These include Beneteau, Dufour, Jeanneau , Lagoon, even racing boats like Pogo.

“We question what’s going to happen with the profitability of these manufacturers as we see volume decreasing. Demand on smaller boats is steady but starting to decrease. The demand on higher-end boats remains pretty high. 

“Another reason for increases are the energy costs, which have multiplied by a factor of seven since the Ukraine war started. And this is a big concern for a lot of companies in Europe today.

“In some cases, boat manufacturers are assembling and shipping the vessels without complete components, such as air conditioning units, generators, even toilets, knowing these can be added later. And now there is a shortage on steel extension pulpits.

“Shipping is still an issue. It’s hard to find a shipping company the boats today.  Boat manufacturers are competing with Volkswagen, BMW, and Mercedes. So, the price of shipping has gone through the roof. A boat is going to take the space of maybe eight or ten cars.

“We are going into challenging days for sure,” says Devanneaux.

Charles-Etienne Devanneaux

Sailor and sail racer Charles-Etienne Devanneaux founded NAOS Yachts in 2009. He is a lifelong sail racer with accomplishments that include the Newport-Cabo Race, several Transpacs, and the Pacific Cup. NAOS Yachts is primarily a new vessel dealership offering the sailing brands Beneteau, Lagoon, Amel, CNB , Neel Trimarans, power vessel brands Four Winns, Wellcraft, Beneteau, Antarès, Flyers, and dinghy AST Composite.  

Veteran sail racer and yacht broker Steve Curran has seen increases in each of his last five years, and is on track to see 100 boats during the 2022 calendar year. For boat buyers, Steve sees better value in used boats versus new. He believes that the quality of materials used to build new boats has decreased over the past years. During the covid era, the boat sales market adapted to survive without boat shows, which were largely shut down. 

Celebrating 51 years in Marina del Rey as a successful yacht broker, sail racer, sailing enthusiast, and community boating leader, STEVE CURRAN operates Marina del Rey Yacht Sales and Long Beach Yacht Center. He competed as a sail racer in the 1968 Olympic trials. One year later he opened his Hobie Cat dealership while attending UCLA. 

Yacht Brokers of Marina del Rey meets monthly to address topics related to boat brokerage industry, ranging locally to statewide to nationally and internationally. For more information please contact  co-chairs Alexander Gruft, 619-347-3308 or Steve Curran, 310-877-5500.