New boat, 100% before delivery

[MickeyB]

Hey all,

Question, when purchasing a new boat (surprise :-) ) is it normal to give 50% upfront (not too worried about this) but the remaining 50% 1 month before delivery?

This seems odd to me as you literally have no hold over anything if you give all the money in advance...

Advice please

Mike

[rene460]

Hi Mike, first, congratulations, that’s exciting news.

its a long time ago now but I had similar concerns when I purchased new in 2009.  I was able to negotiate for a supplying letter of credit which is the device used in industrial transactions.  It seems the agent may have had to insert himself in the middle, I’m not sure, but he made it work so good on him, and in the end he boat was delivered and the agent paid without any issues. 

Worth talking to your bank to see if they offer such a facility, then to the agent to see if it can be negotiated.  

I also have to agree that paying 100% with nothing in your hand is stressful as most of us have very little experience of transactions of this magnitude.

rene460

[NZL50505]

I would never agree to those terms. Worst case I’d pay further 25% before delivery but hold back final 25% until delivery day.

[ales]

Wouldn’t buy a new boat without a presence of an attorney. To review the contract and to deal with warranty issues that will happen for sure!
It’s a strange world….
Good luck.

[Zanshin]

When I bought my new Jeanneau 57, I paid in 3 instalments. The final payment wasn't until the commissioning was finished.

Are you buying through an official Jeanneau broker? In which country? And what sort of title will it have?

[Charlie-Bravo]

Not had the pleasure of purchasing a new boat, but sending off all the money without seeing and trying out the product would not seem wise, .. as others have said.

All purchases are subject to negotiation, and whilst their terms might seem obligatory to accept, if you threaten to go buy a Hanse instead, more favourable terms might be on the table.

Good luck with it

CB

[Tafika II]

We paid the broker firm 25% when ordered, 25% when shipped from France to the US, 25% upon inspection delivery, and held 25% until after commissioning and sea trial signoff. Even though it was a new boat, we had a survey done by an independent firm to ensure all the work was done well & as contracted.

[kaz]

I would not pay 100% until boat is in the water, commissioning is done and NOTHING is outstanding. 

I would recommend -  when dealer claim commissioning is done - then have a surveyor part take in sea trail and test. 

Everything I have read about boat deliveries post covid is "we are missing parts" story - especially from "big guys" like Beneteau and Jeanneau. The other "normal" is " we are missing XYZ" and it is not arriving until 6++ weeks from now. Some have even received the wrong boxes from the before mentioned. Or sails in the wrong size.

I don't think I have read about a single delivery done right for a while.. (But please if I'm wrong feel free to correct me)

So I would go with the XX% upfront, XX% upon unloading in agreed port and last - at least 10-25% pending full delivery of all items and post acceptance sea trial.

I would also ask for a time limit on delayed orders - so if they go past X weeks delivery delay you either retain the right to fully return the boat (they probably wont accept that but ask as part of negotiation tactics!) - or get a GOOD discount based on delay timeframe. (Example - "Until yacht is considered 100% delivered and commissioned,  including ALL ordered parts, the vendor will discount the sale price with 1.5% per running month of accumulated delay. If the delivery date is delayed in excess of 90 days post agreed delivery date, the buyer retain the right of contract cancelation with full refund, unless the buyer have agreed to the delay in writing and buyer have been compensated for the delay") (<- get a lawyer to check that) 

The factory will try to weasel out of a delay clause but fight for it. I would say it is more than 50% probable that there will be delays in part of your deliveries. But at this moment, with the boat market crashing hard, you are more in the drivers seat than you wore 12 months ago. 

The dealer "usually" earns 5-10% - so the amount have to be larger than your dealers own "risk" to motivate the factory. Else you end up with the dealer taking the risk by himself - and then there is no real pressure for the factory to "complete".

The factory need to "complete" to book the sales in their accounts as "sold" and not in the "pending order" column. For a listed company like Beneteau (owner of Jeanneau) - it means something.