Buying a new 45DS

[tamvong]

Hi folks,

I wonder if anyone out there can help me. I am currently in Phuket, Thailand and am considering buying a brand new 45DS from a dealer here. Although my agreement is with the local agency and includes delivery to, and commissioning (including attaching the keel, mast, rigging etc) by them in Singapore, they are insisting I take ownership of the boat and pay 100% of the cost when it exits Jeanneau's factory in France. They tell me this is standard for all new boats from any manufacturer. Is this in fact typical?

Thanks for your help.

[gecko36i]

Hi
I was told the very same thing when purchasing our 36i in Australia and after paying 95% of the total cost including 55k comissioning costs for extras for charter work. The importers went bust just as the yacht arrived and found that not 1 cent had been paid to Jeanneau a long legal battle and an additional 80k later I got the boat. Jeanneau took a large loss. Please get legal advice on how best to protect you money maybe a holding account arrangement for handover when boat is delivered also talk dirrectly with Jeanneau. I will never pay in advance again. Be warned.
Cheers
Gecko

[rene460]

Hi tamvong, it seems normal for Jeanneau, though only the factory part of the cost, not whole agents supply. A friend who purchased an American boat found same thing. Try suggesting to the agent that you supply a "Letter of Credit" from your bank (your bank manager should be able to explain it to you) as used in industry for large International purchases. Agent may want to add financing fee to price. The bank fees are a small price for peace of mind. Note this is a suggestion from a fellow boat owner, not qualified legal advice, Gecko's suggestion is good, for most of us are not experienced art working with contracts of this size and complexity. I hope that this helps.
rene460

rene460

[johnbenq]

The key issue here is who carries the credit risk for a large dollar value item. Jeanneau bears the biggest risk of loss as it spends far more constructing your boat than the dealer does trying to sell it to you. If you accept that proposition, then it doesn't make sense for anyone to pay a dealer and then both you (and Jeanneau) hope that the dealer pays it to Jeanneau. I agree that you need to get legal advice. One approach that you might want to discuss with your lawyer is that if you are happy to take a risk that Jeanneau won't go broke before your boat ships, arrange the deal so that you: 1) pay Jeanneau for the boat when it leaves the factory; 2) pay the dealer their commission on arrival of your boat; and 3) pay the dealer the commissioning fees after commissioning. Note that the dealer may be unhappy about that because it will expose their commission amount. The answer to that is how badly do they want to sell the boat?

[tamvong]

Thanks guys. You are confirming my discomfort. I have suggested paying Jeanneau directly but the agent says Jeanneau will not deal with individuals. I will look at some of your other suggestions and let's see how much they want to sell it as you say JB

Gecko, I'm curious, if no money had been paid to Jeanneau I'm surprised they built the boat and shipped it.

[sitara]

It seems Jeanneau dealers all have different systems. Our dealer requested 10% deposit on signing the contract, 65% when the boat left the factory, 20% just before the ship arrived and the last 5% when commissioning was complete and the boat was handed over. While this did not eliminate our risk it did seem a reasonable system.

[johnbenq]

Again, you would need to speak to your lawyer. However, the approach of paying money to Jeanneau does not involve you buying the boat off Jeanneau. You still buy it off the dealer, but you paying the bulk of the money to Jeanneau on behalf of the dealer. That avoids the Gecko problem. The dealer should not be at all concerned about that. After all, they simply pay the money to Jeanneau anyway. It is possible that the dealer has payment terms with Jeanneau that let them delay paying your money over to them (which they can get interest on and play with exchange rates). However, that can all be dealt with in the purchase price.

[gecko36i]

Hi Tamvong
Yes I was also very suprised but this is what my lawyers informed me when we tried to claim the boat when it arrived at the docks. My yacht was part of an order of 8 boat so their may have been a percantage of the total deal paid? Anyway it happened and cost a lot of extra money to get the boat as the only other option was to take a loss.

[maby]

We had the same issues to consider when we bought Vixen. Jeanneau do not take any of the risk - they want payment when the boat leaves them. In our case, the dealer wanted full payment when they placed the order with Jeanneau - months before we took delivery. I questioned this and they told us it was standard practice. We cancelled the order and they came back agreeing to accept a 10% deposit with full payment on delivery. I subsequently discovered that it is common for the dealer to expect full payment long before delivery - as our dealer explained, they had to pay Jeanneau most of the money long before it arrived and they were having to extend their overdraft to cover the cost of our boat while we waited for delivery.

I guess it all depends on how much they want your business and how willing other people are to pay in advance.

[allegria]

A quick note on this topic to let you know that Jeanneau did accept a direct payment from me when I bought mine in 2010, I can't recall exactly but this was not the full amount, although more than 50%. An yes, they would not release the boat from the factory prior to getting the full payment. The payment process was fairly transparent between the dealer and me, and was phased with no surprise...

Hope this helps,
Good luck.

[deandavis1]

Hi Tamvong. I tried to send you a PM but it looks like that is not possible on this board. Drop me an email at dd_sydney at hotmail.com if you have a chance.