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Coronavirus Covid 19 and Marine Industry

Discussion in 'YachtForums Yacht Club' started by olderboater, Feb 29, 2020.

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  1. Alzira II

    Alzira II Member

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    88,000 people died of alcohol related deaths annually(US) source- NIAAA.gov. 56,000 die from flu(US) source-cdc. etc, etc etc,,,, Here is a shocker that does not require a virologist to explain, the UN estimates 25k people starve a day. Yes I do believe there is a larger amount of the world attention on this issue compared to other issues. A lot of that is because of the unknown elements of this virus. There is people working tirelessly allover the world trying to solve an infinite number of problems society faces, God bless them for it. It would be great to get a fraction of the airtime for some of these efforts. To my point, the disproportionate percentage of global attention towards this issue will probably result in some pretty significant economic issues. The end result of that will give the virus a run for it money in damage to peoples lives. Maybe "hysteria" is not the most refined word to explain the amount of attention this is getting possibly "disproportionate while compared to the backdrop of other issues" may be better placed.
  2. Oscarvan

    Oscarvan Senior Member

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    China is starting to ramp up economic activity again. I believe the market is oversold and will recover to some extent. At this point we're back at 2018 levels..... Not the end of the world. That said, this coming week is not looking good right now.
  3. mapism

    mapism Senior Member

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    Far from denying that there's plenty of other problems in our planet that would deserve better attention.
    If only we were driven a bit more by ethics and a bit less by economics, it would be a good starting point.
    But that's for another debate.

    Here, the key issue is that you can't even say if the efforts that are being dedicated to the matter are proportionate or not, because you don't have a clue.
    Never mind semantics, It's not your drastic wording I'm arguing against, but the essence of your reasoning.
    Because while on one hand we can measure the "backdrop of other issues" as you say, like the DJI or whatever, the real threat of this virus, in spite of the fact that so far the statistics don't look awfully scaring, is actually yet to be understood.
  4. PacBlue

    PacBlue Senior Member

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    For those of us who have earned our salaries from the marine industry only the past 30 years, we are well seasoned on the cyclical nature of the pleasure craft industries. Unwarranted luxury taxes, recessions, tariffs (although they seem to be manageable), viruses, etc., it can be quite vicious in nature to ones livelihood. But we tend to have a batten down the hatches approach to weather the storm of the era and know that there will always be more storms to follow.

    But one thing we have learned is that you can NOT control all things and events, once you realize that it plays easier on your career's mental health.
  5. Alzira II

    Alzira II Member

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    Getting back to the original question at hand. After a nice decade long run in the business it may be quite nice to see who is operating off a balance sheet not an income statement. Amazing how boat deposits tend to cover parts and warranty accounts when times are good.
  6. Capt J

    Capt J Senior Member

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    Well, let's face it. Even if the virus doesn't get any worse, it's still effecting the global economy pretty decently. Perhaps like 9/11 did. The entire travel sector is taking a huge hit: airlines, cruise lines,hotels, rental cars etc. This will go on until we see a bottom for the virus, either a vaccine or we fully understand it or it turns out to be no worse than the average flu or it disappears......MY gut level feeling is in a few months when it warms up, it will disappear just like the flu does......until next year or never.

    Here's just 1 example that I know of and it effects me personally. 1 yacht I manage is owned by Guatamalans, we've had a 12 day Bahamas trip scheduled for April 1-11th for 3 months now for 6 people on a 66' yacht they own that stays here. They usually fly in a few days early and buy electronics and personal items at stores and then their own groceries. If there are even 500-1000 cases in South Florida of the virus they'll cancel and this is how it effects the economy and what they would spend on this trip:
    U.S. electronics stores/mall $10,000
    Flights $6000
    rental car $250
    U.S. restaurants $2000
    US grocery stores $4000
    Marina's + food in Bahamas $8000
    Fuel Bahamas $ 7000
    Bahamas customs $450
    Boat rental $ 2000
    U.S. Crew: $9000
    Fuel U.S. $3000

    That's just if 1 person cancels a 12 day trip to the Bahamas with 6 people. Imagine how many other yacht owners in the yacht capital of the world will cancel travel. It directly effects me and the mate and it's great income that we both lose forever as well as everyone else in that supply chain if they cancel. Sure, if they cancel, they'll do a trip later after the virus subsides BUT, they would've done the later trip anyways, so it's lost money from Guatamala that we won't spend in the U.S. economy.
  7. CTdave

    CTdave Senior Member

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    I just read the Dubai boat/yacht show has been postponed till the fall.
    Speaking of economic impact, I can say it's already hitting the building business. I am putting up an office building in NY right now and I was told yesterday that a huge order of Italian flooring tile was just put on hold indefinitely. We cancelled the order today and will be buying an alternate (hopefully the AIA will pic a U.S. made tile this time).
  8. Oscarvan

    Oscarvan Senior Member

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  9. HTMO9

    HTMO9 Senior Member

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    But there is the ultimate protection available :)



    Thanks to British ingenuity!

    All sense of humor aside, we are personally affected in the family also. The children doctor of my grandson in Hamburg was tested positive on the Corona virus, on the day, my daughter and her son consulted him. Also not tested positive on the virus (jet!), she and her whole family where placed under isolation at home by the authorities.

    It seems, the only way of breaking the chain of infection, is shutting down world wide travel and all big events for a while.
  10. PacBlue

    PacBlue Senior Member

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    So for the buying types out there, if a Boat Show cancels are you really going to stop your buying process? I would think there would be even more opportunities to leverage the situation in terms of making a better "deal" at the time of purchase?
  11. Capt J

    Capt J Senior Member

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    For many, yes. Many are not sure of either the exact brand or boat they want, or are sort of sure but need to see it in person and compare it to their second choice. Keep in mind that many yachts are ordered now and dealers don't really stock yachts due to the amount of options and colors.
  12. PacBlue

    PacBlue Senior Member

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    I have a hard time believing that someone planning on spending $1M - $5M plus on a yacht has not done significant due diligence before he goes to a boat show. I expect he would still be able to pull the trigger on the sale without the show +/- 3 months if he was already planning on the purchase.

    I know there is a certain thrill associated with getting a Boat Show "Deal" and being part of xx number of sales at a show, but all that can take place outside of the show if necessary, as it would be now. As a matter of fact, many show deals do not get fully "consummated" at the show itself at take 3 - 6 months to work out the final deal on a good day.
  13. olderboater

    olderboater Senior Member

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    I think you'll see a lot of wait and see. Most who were close to making a purchase will put it off, especially depending on the part of the world, on the location of the buyer and the builder. I think nearly all Dubai show attendees would wait.

    Also economic uncertainty is going to lead people to delay. Think even of a show like Palm Beach. I think many won't attend if it's held. I think if the show was this week, of those who did attend, most would wait to see what happens.

    Having just placed an order for a boat right before this, I can say without question had it been today we wouldn't have. Wouldn't have made the trip to finalize the purchase. Would have just held off everything.

    Uncertainty leads to delay and the one thing we have plenty of right now is uncertainty.
  14. Capt J

    Capt J Senior Member

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    You can do ALL of the due diligence you want, but without walking on the particular boat and seeing it in person, most people won't make a decision. I had a customer who was 6'4 and was hell bent on a certain MY and I tried to tell him that it was not the boat for him due to his height. Within 3 minutes on the actual boat and seeing the headroom (and his head touching the headliner in most places) he instantly ruled it out. Most people in other countries don't have the luxury of seeing all of these different boats at any given marina, they might have 2-3 yachts in mind, then at a show, they can see all 3 on the same day. I have one customer that will not buy a motoryacht with a bar in the salon for example. I had to show him that the tiny bar in the back of the salon wasn't noticeable and was to hide the staircase to the engine room and crews quarters. After that he was fine with it (72' Hatteras) and his favorite choice but now out of his price range after splitting half of his assets!

    I run 100-150 different boats/yachts per year. Most of the new models everyone is dieing to see, so I don't need to go to a boat show. But, in order to see a new model, MOST owners only get that chance at the boat show. The long standing joke on the old Carvers, is that the only way they ever sold boats at the boat show with boats rafted to the sides of them, because when people see how ugly they are without a boat rafted off of the side, nobody would buy one! LOL
  15. f3504x4ps

    f3504x4ps Member

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    It's starting to hurt the big Airlines now, I just read International and domestics flights will be reduced by 20% and 10%, working more with customers and fees. Voluntary unpaid leaves, postpone salary increases for several months, hiring freeze.
  16. Oscarvan

    Oscarvan Senior Member

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    That's verbatim the memo I just got..... from my boss. This is interfering with my plan for world domination....
  17. Alzira II

    Alzira II Member

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    It certainly will not help in most of situations. In middle America the Summer vacation very well may not involve that trip to the Bahamas, cruise, or euro getaway but the idea of buying a new boat for the backyard dock might do the trick for a new toy. Hard to get a virus walking from your back door to the dock. Atleast I hope some people are looking at it that way.
  18. olderboater

    olderboater Senior Member

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    Most boat buyers are business persons and/or investors. With the economic uncertainties, they are unlikely to jump into boat buying.
  19. olderboater

    olderboater Senior Member

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    May or may not have played a role, but UK airline Flybe shut down today.
  20. leeky

    leeky Senior Member

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    Most boat buyers are just regular people. I suspect that this is one of those times when you should have used the word "yacht" instead of "boat."
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