Buying a new yacht should be a fairly orderly, well-trodden process. The specification and prices is agreed, a deposit is placed, and a delivery date advised. But negotiations add another, highly variable, dimension.
Brought about by buyer power, yacht availability and the natural machinations that arise in any high-value transaction, yacht purchase negotiations and the search for the right ‘deal’ are as much a part of yachting as deck shoes and fenders.
In this article:
Yacht buying and negotiation - the basics
For the purposes of this article we are focusing on production yachts, and that is to say anything other than a full custom build.
You might hear the term semi-custom used in the yacht world, this refers to a production yacht that offers more Owner choice in fit and finish, but it is, ultimately, a set design.
Price
A new production yacht should be straightforward in terms of the top-line price, cost of options and delivery time. Costs are laid out in annual price lists and often optional extras are packaged up into useful groups for key areas such as navigation and interior furnishings.
Delivery
In terms of delivery, it takes a certain and qualified amount of time to build a production yacht and so there will be little to discuss in this area. Market forces are the main differentiator - if you're buying from a sought-after builder you might have to wait longer.
Compare all of this to a full custom yacht, which requires far more input from the Owner and their build team with the final costs and delivery date very much decided by the complexity of the design and build and how it is project managed, and a production yacht is certainly more straightforward.
Related articles:
Yacht Buying Options - Built to order, Spec & Stock
If your heart is set on ordering a new production yacht, built to your particular specification, you will have to wait in some sort of line for delivery. And as with any retail transaction, supply and demand will play a major role in your power to negotiate.
However, production and semi-custom yachts offer up some interesting and enticing buying options in so-called spec-builds and stock yachts. Both of these options can add more power to your buying elbow and, if you are prepared to be flexible on the exact finish, you can enjoy faster delivery times and maybe even the yacht-purchase holy grail, a great deal.
1. Yachts 'Built to order'
A new yacht order grants you the exact specification and finish you require, but with a longer build time.
Pros
- Maximum owner choice
Cons
- Longer build time
If you want a new yacht built to your own particular specification and finish, you can place an order. This may mean having to wait a little longer on delivery.
For custom and semi-custom yachts the list of options and finishes is vast, but there is also lots of choice available with production yachts.
Typical yacht personalisation
- Hull colour
- Interior finish
- Engine power
- Equipment level
Most builders work to pre-supposed numbers for a particular model and the production capacity required to deliver those numbers. There might be room to up capacity, or move it away from a less popular model, but even then the extra builder numbers will be minimal.
A popular yacht model's forward order book could run to several months or even years, plus the actual build time of your yacht.
This is why some buyers choose less well-known yards. If that builder has the capacity it means an immediate build slot and, given the fact the builder needs the work, a good deal.
Typical built to order delivery times
| Yacht length | Time to delivery |
|---|---|
| 12- 15m | >12 months |
| 20 - 30m | 24 months |
2. 'Spec' build yachts
A spec build, standing for specification build, allows you to speed up the delivery and ownership process by buying a yacht already in build and offered to an existing specification.
Pros
- Opportunity for negotiation
- Faster delivery
Con
- Less opportunity for personalisation
There will be occasions when a yacht builder has models under construction without an actual buyer in place. These so-called spec builds will be to an existing and usually good specification.
Spec builds offer you a faster delivery time with some level of personalisation, although this will vary according to how far along the build is and the size of the yacht.
A 15m yacht near completion might only offer the chance to change elements of interior furnishings, a 30m yacht only recently under construction will offer a great deal of personalisation.
Buying a yacht already under construction is good news for the builder too, and so there may be a degree of negotiation on the asking price.
Typical personalisation
- Elements of interior finish
- Equipment level
Unless you are buying a spec build that is about to hit the water there will still be an element of delay to your Ownership, and even if it is close to launch there will still be a period of time required to prepare the yacht for the sea and any of your personal requirements.
Typical 'Spec' yacht delivery times
| Yacht length | Time to delivery |
|---|---|
| 12m-15m | 6 months |
| 20m-30m | 12 months |
For high-capacity production builders of small yachts, the process of building yachts and finding buyers as you go is normal and does not constitute a spec build.It is more a standard industrial process, supported by the fact buyers at this level will have few ways to personalise their yachts.
3. 'Stock' yachts
A stock boat is one that is fully prepared and ready for Ownership, held in stock by a dealer of the builder, and offering the chance of immediate use. If you're buying in the spring for summer use, a stock boat is the ideal way to realise your boating ambitions.
Pros
- Immediate ownership
- Opportunity for negotiation
Cons
- No option on specification or finish
There are fewer yachts held in stock by dealers nowadays, but it does happen and when it does these yachts can make excellent buys.
Stock boats are often built to a high specification, with popular layouts and the right engine option.
The dealer will be keen to sell the yacht and so the chance of agreeing to a deal, below the quoted price list amount, is high. The dealer will also be happy to retro-fit equipment and the yacht will come with all usual warranties.
Typical personalisation
- Retro-fit items only
The biggest benefit to buying a stock boat is that rarest of yacht occurrences, instant gratification. Once your personal effects and equipment are installed the yacht is prepared for sea and you are away.
Typical 'Stock' yacht delivery times
| Yacht length | Delivery time |
|---|---|
| 12m-15m | 1 month |
| 20m-30m | 3 months |
Payment Structure
If you are buying a yacht that is built to order or a spec-build there will be a payment process to follow. These so-called stage payments will differ from builder to builder and dealer to dealer, and if you are using a degree of finance for you new yacht purchase this will need to be discussed and planned for separately. You can read more about finance below.
For smaller yachts, under 10m-12m, the payment process may have less stages, with a deposit placed and balance paid on delivery.
Typical Stage Payments
- Deposit
- Build commences
- Engines installed
- Superstructure fitted
- Delivery
The payment process for a yacht will usually be structured to run over four or five stage payments set at pre-agreed, clear and tangible stages of the build that signify clear progressions.
The ‘tangible’ part of this equation is key. As an example, the commencement of interior fit-out does not make a good stage payment moment as this part of the build can go on for months and might only be marked by the fitting of a door.
Engine fitment, however, is an ideal stage payment point. Engines make up a large part of the yacht’s costs and value, and so it is right that a payment is made to signify and support this progression in build. However, it is critical that the engines are actually fitted, bolted to the bearers, and not simply sat next to the yacht.
The amounts paid in each stage will vary. Most dealers or brokers will look for around a 20% deposit to be taken, with similar-sized stage payments thereafter and a final balance paid upon satisfactory delivery.
Negotiation
Every yacht purchase, even that of a smaller high-production model, can be viewed as an individual case with a notable amount of negotiation to push it over the line. As yachts get larger the negotiations become more complex and the line gets wider and possibly quite wiggly.
If you are buying from plan there will be all manner of options to discuss and agree on, and often these options will form part of the deal. As an example, the yacht asking price might remain the same, but a high level of optional extras can be included.
If you are buying a stock boat the deal will be almost entirely focus on the yacht price.
Typical areas of negotiation
- Asking price
- Optional extras
- Berthing costs
- Delivery Fees
Asking price
They want X, you bid Y and both parties meet somewhere in the middle. The list price for a yacht is the most obvious place to negotiatiate, and is always under the greatest scrutiny as you compare one yacht brand's model against another. See the '20% offer' section below.
Optional extras
Away from the headline price, it is possible to negotiate on the optional extras. Given that these will often amount to a sizable sum it is a good route to take as part of your deal. Often, extras will be bundled up into cruising packages worth tens or even hundreds of thousands, making it an easier and neater process to navigate.
It is an oddity of production yacht buying that builders and dealers may be more flexible on optional extras than the yacht's list price.
Berthing costs
Finding a yacht berth can be difficult. As part of your yacht purchase is there an option for you to enjoy a free 12-month mooring? Does the dealership have any spare moorings or is there a marina partner who can offer preferential rates?
Delivery fees
Depending on the distance between where the yacht is built and you want it delivered, there could be a sizeabale fee involved. Make this part of the purchase and you you could save thousands.
The 20% Offer
There are many theories on what constitutes a fair offer, or a ‘normal’ reduction in the asking price for a yacht. The most popular of these is the 20% offer, whereby you simply offer 20% under the asking price, the dealer sinks to their knees in submission and all is well.
Whilst it is fair to say that there is always some room to manoeuvre on price, there is no norm, nor guaranteed offer that will win you your yacht. Some deals will be close to the list price, others agreed at levels far below. It will all come down to the yacht itself, availability and your buying power.
Buyer Power
The more money you can put down against a new built to order yacht or spec build the stronger your negotiating position. Cases where the buyer has paid for a yacht up front, months or years ahead of delivery, have resulted in large discounts. Certainly, the larger the deposit, the better your negotiating position.
A stock boat might be obtained at an attractive figure if you can move quickly, with finances in place.
Boat show use
If you agree to your yacht attending a show or event on behalf of the builder or dealer, a financial incentive in the form of a reduced purchase price may be offered .
This usually applies to new or recently launched models, and the yachts will be sent back to the builder or dealer afterwards for any remedial work to ensure they come into your ownership in perfect condition.
Finance
Many yacht purchases will include a degree of finance, either privately agreed or part of a marine mortgage directly aligned to the yacht.
In all cases, the lender will have particular terms with regards to the yacht’s ownership and how and when monies can be paid.
Finance does not necessarily effect your negotiating position, but it can complicate it.
