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The Gorilla in the Room

Two wonderful book recommendations this week, loyal readers. Their common theme is … genius!

This first book jumped out at me from a glowing review in the Wall Street Journal earlier this year: The Making of Stanley Kubrick’s 2001: A Space Odyssey, by Piers Bizony. This is a stunning coffee table book, ingeniously packaged in its own symbolic “monolith” box. While I didn’t splurge, a larger four-volume version (autographed by Mrs. Kubrick) is available in a limited edition run of 500 for $1,500. If you buy that one, lunch is on me.

kubrick_2001_a_space_odyssey_ce_image026_03109_1404091009_id_757042

 

Stanley Kubrick’s genius was that he came up with the visual style of the film long before he even had the the story. He commissioned a series of magnificent paintings (the heart of this book) before the script was even written:

 

2001a

 

Despite tremendous pressure to cut corners from the banks and studios that financed the film, he remained true to his vision right through to his final edit. It’s quite an inspiring story.

It’s also full of wonderful movie trivia, including this fact: In 1969 the Academy Awards did not nominate Space Odyssey for Best Costume Design, despite its riveting portrayals of early man, allegedly because they believed the “actors” were real apes.

I’ll leave it for you to decide:

2001pic

http://www.tcm.com/mediaroom/video/474162/2001-A-Space-Odyssey-Movie-Clip-Monolith.html

And this, in my own whimsical and idiosyncratic way, brings me to the heart of  the matter, to the gorilla in the room, to the concept so often left unexplored in our industry:

Depreciation.

You won’t hear “the D-word” much at boat shows, for obvious reasons. And googling the concept won’t provide you with any accurate and authoritative data. For reasons that run from the obscure to the obvious, there is no reliable Kelly’s Blue Book of yacht values. Some surveyors and brokers offer their opinion on the matter, usually throwing out an anecdotal “10% a year for the first five years”.  But they don’t tell you how they got there. So I took a crack at it.

Yachtworld has an industry-insider database called “SoldBoats.” A subscriber can, for example, see the sale prices of every brokerage Riva 33 sold in the USA for the last five years. If you can determine the original sale prices, you’re most of the way towards knowing the true cost of yacht ownership. No matter what builder (and continent) you choose, I urge you to ask your broker to take you through their version of this analysis. Be forewarned, sometimes this journey takes courage!

Looking at the usual suspects for the last few years (from Italian, Asian and American builders)  I come up with an average annual depreciation rate of:

 11.3%.

Ouch.

And the Hinckley experience, you may well ask?

Well, I was prompted to go down this path two weeks ago when I got the full report of the sale of a three-year old Hinckley Talaria 43.

Hinckley Talaria 43

 Hinckley Talaria 43

Her total depreciation came to a shocking 7.14%. On an annual basis that’s just :

 2.38%

However compelling an anecdote that is, I didn’t want to hang my hat on a single data point. So I sit here today with a boatload (lol) of rock-hard data about every brokerage Picnic Boat Mark III sold since the spring of 2011.

mkiii

Twenty-three of them found new owners, after having been owned for between 12 and 87 months. I was stunned by the median annual depreciation rate:

5.1%

What is going on here?

My theory, as we have been discovering together for the last few months at The Fog Warning, is that there is an ever-reinforcing value proposition here at Hinckley. If you go back and read through my last five or six blog postings, the ingredients of a recipe are revealed:

  • Start with a classic and unwavering aesthetic discipline
  • Add to it substantial investments in design, engineering, and technology to produce the safest and most versatile use possible
  • Build it so well that you can confidently offer a lifetime hull and deck warranty 
  • Offer stem-to-stern annual service packages to owners and buyers who have a unique and enduring appreciation for iconic yachts.

Stir well and serve immediately to get:

VALUE

That qualitative and quantitative value bakes in the lowest depreciation rate, and the lowest cost-of-ownership plan I know. So put it this way, if you can buy a new yacht that retains 92.9% of its value three years later, I’ll ask you to do two things: first, call me to verify the numbers. Second, rush to contract.

 

OK, book #2:

huntdesign

I haven’t read many biographies that I would characterize as thrilling (although I’m reading one about spy novelist John Le Carre right now that comes close) but I think most boaters will find  A Genius at his Trade a thrilling read.

I’m going to quote Joseph Gibbons here from his review in Maine Boats and Harbors magazine:

To call Ray Hunt an Archimedes doesn’t seem wide of the mark. The Greek philosopher—inventor of the screw propeller, explainer of the principles of leverage, conceiver of the laws of displacement of fluids while taking a bath—saw more clearly into the physical world than other men. C. Raymond Hunt (“C” for Charles) was like that, too. The New England sailor and designer was father or godfather to the deep-vee powerboat, the ubiquitous 13′ and 16′ Boston Whalers, the Concordia yawls, the modern spinnaker, the amidships cockpit sloop, the lively 110 and 210 day-racers, an improved destroyer hull design for the U.S. Navy, world-beating 5.5-Meter yachts, and perhaps scores more of boats and boat developments that were left unfinished in the creative ferment of his life, were taken up by others, or remain to be discovered.

I’ve highlighted Joseph’s comment about Hunt’s “creative ferment” because I see how it lives on today at Hunt Yachts. As they say on their website:

“Along with Hunt Design Associates, we have benefitted greatly from the design heritage of Ray Hunt and are proud to count his grandson, Ray Hunt III among our engineering team. Our company was founded on C. Raymond Hunt’s design principles, specifically the innovative, deep-v hull that still sets Hunt Yachts apart today.”

I am so pleased and excited to tell you today that I can show  the results of this esteemed heritage at the Newport Boat Show this September. Just say the word, and I’ll introduce you to Ray and the entire design team, and provide you with a personal and private tour of the brand new Hunt 72:

IMG_0082

                                                                  34 knots? 34 knots!

hunt72c

hunt72c

                                           Hunt 72 – Photo Courtesy of Hunt Yachts

Please feel free to take me up on all that I have offered you here today. You know the drill – Just launch a flare!

Oh, one last thing – Do you recall last week’s “snoozeagram” about the sudden availability of a mid-build Picnic Boat MK III? Well, it sold, in just a matter of days. As I’m known to say from time to time:

You snooze, you lose!

Thanks, and enjoy.

Big Wave Dave

 

 

 

You snooze, you lose!

I. A Very Rare Opportunity – 

I used to be known for a particular phrase in this biz (and no, not launch a flare, which I still delight in using). This other phrase had travelled far enough around that boaters I’d never met would quote it to me at boat shows:

You snooze, you lose!

It came from my self-titled snoozeagrams, my leaks that a rare deal – a leftover model, perhaps – was there to be had for the smart and the swift.

I didn’t think I’d have an opportunity to launch any snoozeagrams here at Hinckley Yachts,  because Hinckley’s are only built to order. But for a single demo boat every now and again (our 34R, this year) if you want a yacht, we’re happy to build her for you, carefully and efficiently. But there are none, so to speak, sitting on a shelf somewhere, snoozeagram-worthy.

Until now.

Due to a mid-build cancellation, we have a brand new Picnic Boat Mk III splashing in just five weeks at our Maine factory. While you can choose the fabrics (if you hurry) she will look very much like this:

Photo courtesy of Hinckley Yachts

Photo courtesy of Hinckley Yachts

This work of nautical art needs an owner, and it should be you. She is an exceedingly well-equipped model, with upgraded Volvo 435’s (37 knots top end, as opposed to the standard Yanmar 370’s 34 knots) as well as air conditioning and a 9KW generator.

Here I will rely on my old  friend Ken Kreisler to take you though the joy and wonder of a MK III:

The specifications and selected options list is lengthy, and I’d be happy to navigate it with you line by line. But as I’ve said, this is a rare opportunity, and I don’t expect her to sit around long.

So, you’ve been warned – You snooze, you lose!

 

II.  A Thing of Beauty

I live in Westhampton Beach and work in Southampton. I keep a flats boat in Noyak, and my trawler in Sag Harbor. I’m very lucky to get around a good bit, exploring every creek, cut and bay over thirty miles of the Hamptons. And because Hinckley shallow draft jet boats can go “where no man has gone before” (that PB MK III mentioned in my snoozeagram floats in just 25″ of water) I often find them tucked away in pristine and beautiful spots.

That’s how I met an owner of another MK III, when I poled up a shallow creek in search of some striped bass earlier this season. He keeps his yacht at his dock, and she is indeed beautiful. I’m happy to say that we’ve become fishing buddies (he can cast a fly halfway to Portugal – it’s a thing of beauty).

He called me from Europe the other day, asking if I could run over to check on his boat, as On Watch advised him that his MK III had lost AC power.

On Watch is Hinckley’s proprietary remote monitoring system. It wirelessly reports to both the owner and our service team, in real time, the status of all mission-critical systems aboard a Hinckley.

You met Scott Bryant a few postings ago – he’s head of New Product Development at Hinckley. Here he is introducing the On Watch phenomenon:

 

Its a great and useful bit of technology. And my fishing buddy? The boat was fine. But he had lost shorepower, dockside. I flipped the breaker back on, and when he returns home he’ll find his Sancerre still chilled. A thing of beauty, that On Watch!

 

III. “R” Word

As you’ve been reading, I’ve been running our new Talaria 34R every chance I get. It’s been sometimes mistaken locally for her bigger sister, the 38R (perhaps because there are five 38R’s in Sag Harbor alone).

I’ve been asked a few times to compare the two boats, and this week Hinckley put this great pic up on their Facebook page. It says it much better than I can:

Photo courtesy of Hinckley Yachts

Photo courtesy of Hinckley Yachts

Obviously that’s the 38R up top, with the 34R to starboard. Two Hunt Yacht offerings round out the fleet.

A better understanding of the differences between the 38 and the 34 (their performance envelopes, ergonomics, etc.) are beyond the scope of this posting. Just launch a flare, and we’ll meet on a boat ASAP to discuss.

 

IV. And Now a Word From our Sponsor

Stay tuned for my next report, entitled “The Gorilla in the Room.” Here’s a hint of things to come:

 

Ciao for now, fellow boaters.

 

Big Wave Dave

Living the hug 

I have a haddock (II)

I. Headache-free Ownership – Yes, I’m opening this post the same way I closed the last one. If you laughed last week, get ready to laugh some more:

Why, you may ask,  all this talk about headaches in what is supposed to be a yachting blog?

A bunch of years ago I sold a dealer demo to a knowledgeable New England yachtsman. It was a stunning 54′ “downeast” design, but after moving her up and down the east coast boat show circuit she definitely had some wear and tear on her.

My client loved her classic lines, but he was concerned about the quality of his ownership experience. I’ve always remembered his comment:

Dave, I will buy a yacht. I won’t buy a headache!

We all get that. When the most valuable of assets is our quality leisure time, who has time for headaches? The truth is that when you’re not aboard your boat only two nautical concerns should cross your cerebral cortex from time to time:

1) Did I tie her up properly?

2) Is the holding tank empty?

And that’s it!

Which brings me to Hinckley.

I was happily retired when Hinckley called me last Spring.  As much as anything, what got me to “yes” was that I shared Hinckley’s philosophy of boat ownership. More specifically, I wanted to know what it was like to work for the only vertically integrated company in the biz.

Vertical Integration, downeast style? That’s easy – Beginning to end, and top to bottom

  • Hinckley designs and builds them;
  • I sell them (um, that would be to you, loyal reader);
  • Hinckley wraps their headache-free service plan around you; and, someday,
  • Hinckley sells you out of your boat, and most probably into another Hinckley.

The key to it all is their “haddock-free” service plan. Here’s how it works:

Hinckley has six service yards up and down the east coast:

  • Southwest Harbor, Maine
  • Portsmouth, Rhode Island
  • Oxford, Maryland (my fave, and not only for the homemade strawberry ice cream at the Oxford General Store)
  • Savannah, Georgia
  • Stuart, Florida, and
  • Naples, Florida

The method to their madness is that wherever you are, from a short vacation cruise all the way up to that great seasonal north/south migration, Hinckley is there for you.

Each yard is staffed with Hinckley trained and managed service teams, tied into their Service HQ in RI and the factory in Maine. Their build and service records of your specific boat are exhaustive,  from the time the hull was molded right through to last winter’s winterization (Yes, I see that at delivery your shower hot water was set too hot, and we changed the mixer valve and tuned it down, as you requested). And with employees who have been working for them for decades, you can often talk to the very carpenter who mounted your mother-in-law’s heirloom mirror on your starboard bulkhead.

What underlies this no-headache approach  is Hinckley’s Jet Boat Service Package. This is an all-inclusive option that provides you with fully predictable ownership expenses and dependable quality outcomes.

Hinckley’s captains can pick up your boat at your dock and bring it to the nearest service facility for winter storage. They will assign a dedicated experienced Service Manager for her stay. On arrival he will manage:

  • A sea trial;
  • The inspection;
  • The haul out and winterization;
  • Any recommended annual maintenance;
  • Any warranty work, or equipment upgrades you can imagine; and,
  • Bottom painting, including the jets, inside and out.

Then, come spring, they will commission her and bring her back to your dock, ready for another headache-free season.

It is a remarkable package. It also provides (as will be covered at length in one of my next posts) rock-solid support of your re-sale value, if and when that time comes. Stay tuned for that eye-opening discussion.

And oh, of course, they can do your varnish for you as well, to Hinckley’s famous  standards.

I feel this last bit of context is important, loyal readers, so put on your PFD and focus your Steiner’s:

Looking back over my posts to date, I’ve noticed that without any great plan in mind one theme keeps popping up: VALUE. Whether it’s in the design, construction, technology, and now the service, it’s dawned on me that there is a strong value quotient built into these fine yachts. I didn’t know that before I got here, and it is a gratifying thing to learn.

What is that value worth to you? You’ll have to answer that question yourself. But I look forward to helping you come up with that answer, so (you know the drill) just launch a flare!

What I can provide you with is the cost, so just ask. At the end of a long and wonderful (haddock-free) day on the water I think you’ll conclude that the value provided is greater than the cost paid.

And really now, how often in yachting (and life) do we trip over that?

II. Talaria 48 Flybridge MK II

Nauticexpo

This is exciting! There has been a redesign of Hinckley’s 48FB, now called the Mark II. She now has a galley-up option (I love galley-ups – who wants to work in the dungeon?) and some way-cool technological improvements. I’ll devote a lot of time to this yacht in future posts, but for the moment you can read a little about it here (and enjoy the great virtual walk-through):

http://info.hinckleyyachts.com/t48-mkii

An in-depth video review of the 48 MK I, done by my old friend at Power & Motoryacht magazine’s Ken Kreisler (interviewing my new friend, Hinckley’s COO Mike Arietta!) is worth five minutes of your time. Just trust me on this one:

http://www.nauticexpo.com/prod/hinckley/product-20663-292086.html

 

III. T34

Last weekend I was thrilled to do a sea trial of our T34 Pilothouse for a client up on the North Fork. He was nice enough to snap this pic (like my Hawaiian shirt?) as I pulled away (sideways, by jetstick, of course):

t34dm

In what is a very rare development for us (Hinckley’s business plan is almost entirely “build to order”) I’ve got a 2016 T34 ready to deliver to you right now! Here is the full listing, and just launch a flare if you want the inside scoop. I’ll even throw in a Hawaiian shirt:

http://www.yachtworld.com/boats/2016/Hinckley-Talaria-34-2992426/Portsmouth/RI/United-States#.V5_NDBFdaXS

 

IV. Montauk

You will recall that I had two Hinckley’s at our Westchester event last month. I loved that, as it felt like our own private mini-boatshow. I loved it so much that we are doing it again! In Montauk, no less!

From Friday, August 26th through Monday the 29th I will have a Talaria 29r,

Talaria 29R

and the (yes, available) 2016 T34 Pilothouse mentioned above:

t34interior

This is a wonderful opportunity to see two fine yachts in a glorious setting, the Montauk Lake Club!

mlc2.

You can read all about the Lake Club here:

http://montauklakeclub.com

And you can register for the event here:

http://info.hinckleyyachts.com/new-southampton-office-hamptons-mag?utm_source=August+Buzz+2016&utm_campaign=August+Buzz+2016&utm_medium=email

Montauk in late August is a busy place. I recommend you register like they used to vote in Chicago – Early and often!

This was a long one, folks. Thanks for sticking with me to the end. I hope to see you in Montauk, and I’ll look for you on the water.

Thanks, and enjoy!

Big Wave Dave