Thinking of importing from the US? It might be an option if you’re after a boat you simply can’t get here for the price you’re willing to pay. But there are hidden costs and pitfalls among the benefits of doing so. Norman Holtzhausen takes a closer look.
It can be very tempting to sit in front of your computer
browsing through boats for sale in other parts of the world. Each
region seems to have their speciality, and what is unpopular (and
cheap) in one part of the world, particularly the USA, could
command a premium here. With a strong Kiwi dollar, perhaps it would
make sense – even allowing for the transport costs – to bring a
foreign boat over to New Zealand.
Let’s have a look at the economics first. For this we need to
find a good example. We need a model of boat currently available
for sale in both the USA and New Zealand. A Wellcraft 290 Coastal
fits the bill. At 8.8m (29ft), this is an American-made,
fully-moulded fibreglass production model, proven popular in New
Zealand. Generally powered by twin outboards, these are luxuriously
equipped bluewater boats.
There are relatively few New Zealand-made production boats of
similar specification, so bringing in a boat of this size could
certainly make economic sense. An extensive search on the internet
revealed just one Wellcraft 290 Coastal currently for sale in New
Zealand, while we found well over a hundred in the USA. These
ranged in price from US$232,000 for a brand-new 2013 model, down to
US$35,000 for a 1999 version.
The only model currently available in this country is a 2004
vintage with an asking price of $149,995. This boat has twin
Mercury 250hp four-stroke Verado motors and is kept on a marina
berth. It has just had a substantial service and upgrade done to
it, so is in tip-top condition.
Looking for a similar spec model on yachtworld.com reveals a
2005 version of the same boat, located in Florida. This boat has
twin Yamaha 225hp four-stroke motors, and is similarly well
appointed and in immaculate condition. The asking price is
US$69,900 (NZ$85,257). Although the motors are a slightly different
model from the New Zealand one, the boat is a year younger and
hence we will regard these two as equivalent for the purpose of a
cost comparison. At first glance it looks like this idea makes
commercial sense – an equivalent boat for a saving of $64,738 or 42
percent.
Things to consider
Obviously freight is going to be the biggest extra cost. Luckily
there’s a couple of companies specialising in shipping large items,
typically boats, cars and motorhomes, from the USA to New Zealand.
One such company is Taurus Logistics, based in Christchurch. They
will handle all the export paperwork, such as customs charges, port
charges, MAF (MPI) inspections and so on, and will provide an
instant online quote if you know the boat dimensions and
weight.
Taurus points out there are a couple of things greatly
influencing the shipping costs. A boat shipped from the West Coast
of the USA will obviously be cheaper than one shipped from the East
Coast. Boats without their own trailer, such as this one, will
require a temporary cradle. These can cost several thousand
dollars. It may be worth sourcing a trailer in the USA as part of
the deal, but make sure it will meet with New Zealand
regulations.
Looking at our Wellcraft example, we find the vessel is
currently on the East Coast and doesn’t have a trailer. The brokers
have quoted US$3513 (NZ$4285) to ship it from Florida to Los
Angeles, which seems fairly reasonable. Taurus estimates the
shipping cradle needed will cost $2800 to build. When these are
added to the other shipping and customs costs, we get a total
shipping cost of NZ$28,530.
There are one or two other hidden costs also needing to be
factored in. Some states charge a 7.5 percent export duty on boats,
but luckily Florida isn’t one of them. Of course, when it lands in
New Zealand 15 percent GST is payable, and this is based on the
total costs, i.e. the purchase price plus any US-based shipping
costs. There is also a five percent import duty, again based on the
total costs including shipping. So a further $22,757 is added,
bringing the total landed cost to $136,544 – considerably more than
the original purchase price, but still a sizeable saving on the
locally available model. Of course, our example does not take into
account the ability to negotiate a lower price with the local
seller, and hence the actual cost differential may be less.
Savings and pitfalls
Unfortunately, in the last few years it has become considerably
more difficult to find a bargain in the second-hand market since
the global financial crisis has forced several major US boat
manufacturers out of business. Finance for a boat is now
considerably more difficult to obtain over there, resulting in
surviving dealers often selling second-hand rather than new models.
The strong Australian dollar means our neighbours have also
cottoned on to importing boats, helping to push prices up even
further.
Well-priced second-hand boats are therefore hard to find and
good ones sell fast.
We had an opportunity to speak to someone who has just been through
the exercise. Late last year, Carl imported a Wellcraft 330 Coastal
with twin Yamaha 300hp outboards, and he estimates he saved up to
30 percent of the cost of buying an equivalent model here. However,
a prime reason for his choosing this route was he could not find
his chosen model anywhere in New Zealand, and hence his options
were to accept a different boat or import one. Carl originally
intended to complete the whole process himself, but says in the end
the legal requirements and paperwork proved too onerous and he
called in the experts at American Boats Direct, based in Bayswater,
Auckland.
After chatting to Carl, as well as Lindsay Thatcher of American
Boats, we learned there are a number of pitfalls. Both mentioned
the biggest danger, namely of losing your money to a scam. The most
important first step when buying a foreign boat is to get someone
to view the boat and confirm it actually exists, is in the
condition stated and the seller has clear title. This can only be
done by someone on the ground, and could mean budgeting for a trip
to the USA to view the boat if you can’t get someone trustworthy to
do it for you.
Thatcher mentioned they have two full-time buyers based on the
West Coast of the USA, and their buyer can view the boat, undertake
due diligence and handle the purchase arrangements. Often they are
able to negotiate a discount equaling or exceeding their cost,
making it a no-brainer to go this route. You don’t want to be a
statistic of non-existent boats being sold to multiple buyers, the
seller disappearing with the money, or of those subjected to buying
a boat with an outstanding finance commitment.
Shipping costs
The best way to bring a boat over is inside a container, and a
typical shipment takes three to four weeks. However, for an
individual importer this may not be feasible, because a larger boat
may not fit or may require specialised handling to package it on
its side (containers are higher than they are wide, and many boats
are wider than the 2.4m interior width of a standard container).
Even if the boat does fit, you end up paying the full cost of the
container even though more than half the volume is empty.
Companies like American Boats are experts at this process, and
Thatcher says they can fit up to four trailer boats inside one
40-foot container. With the freight on the whole container
coming in at around NZ$12,000, dividing this up by four makes this
a much more economical proposition. This saving alone makes it
worth working through a specialist importer.
Getting it right
Thatcher also warns against considering boats unable to
fit into a container. As we saw with our Wellcraft 290 example,
bringing a bigger vessel over as deck cargo is several times more
expensive than the cost of a container, and could possibly wipe out
the whole cost saving. He suggests talking to your shipping agent
before even looking for a boat, so you know what the limitations
and costs are up front.
Another consideration when importing larger boats is the wiring.
Anything wired for mains voltage will need to be replaced when it
arrives. The Americans use 110V, whereas most of the
non-American world has standardised on 220V.
It goes without saying the boat should be fully insured for the
entire journey. Many things could go wrong, on the road, at sea or
in port. There’s a high possibility it could sustain some damage so
make sure you have comprehensive photos of the vessel taken before
it leaves the broker’s yard to back up any claims afterwards.
Thatcher also says the location the boat is coming from is
important, and not just because of the extra shipping costs – there
are more boats available on the East Coast (primarily Florida) and
they tend to be cheaper. However, these will likely be in worse
condition due to the high humidity, a greater amount of sunlight
hours and the salt-water environment. The better boats tend to be
those from the West Coast, due to the fresh water usage.
Remember to always keep some funds in reserve. There are
numerous reasons for delays, and every day the boat sits in port
costs extra. When it arrives there could be additional costs
imposed by MAF if they deem a full clean necessary, and additional
customs charges are also possible.
So, if you have done your homework, worked with the experts and
found your dream boat, it should not turn into a nightmare to get
it to New Zealand. Thatcher points out most people only ever do
this once in their lifetime so it’s worth getting it right. h
To learn more, give American Boats Direct a call on 09
455 1020.
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