From: "Al Kirsinas" mrmetro@msn.com
Subject: Re: Consumerism and obsolescence ( was: Trace Inverter
Support)

They used to say that we (Boeing) never made a dime on the sales of our
airplanes.  We made all our money selling parts.  I don't know if that's
still the case today, as our manufacturing costs are much more accurately
tracked than they used to be.  But regardless, a huge portion of whatever
profit there may be in the manufacture of aircraft is in supplying parts.
I've been told by managers at airlines that fly both types that Airbus
charges even more for some kinds of parts than we do, so this isn't just a
Boeing thing.

Based on the work I've had done recently on my 1987 BMW 635, I would
estimate that if I were to have a junker 635 completely restored, paying
market prices for the parts, assembly, painting, etc., the total cost of
the parts and labor would far exceed the original purchase price of the
car, which in 1987 was in the neighborhood of $50,000 (I am not the
original owner).  However, this is a BMW, a make considered pretty upscale
as cars go, and so parts and labor tend to be the maximum the market will
bear.

A Chevy truck, on the other hand, with parts available from NAPA and
similar, low-cost sources, could very well cost much less to rebuild than
to buy a similar new vehicle today.  I bought a new 2wd Ford F250 in 1983.
I still have that vehicle today, and while it continues to run well, the
interior in particular has taken a real beating, there is body and bed
rust, and so on.  I paid $11,000 for the vehicle new, and I suspect that
while a complete rebuild, new interior, new paint, etc. would equal or even
exceeded that 1983 purchase price, it would still be at least somewhat less
than the cost of a similarly equipped Ford F250 today, which I suspect
would cost me very close to $30,000.  Plus, I would have some advantages
with the old truck that are not available with the new ones, particularly
the all-steel, 4-speed "Granny" gear tranmission, considered one of the
best light truck transmissions ever made.  You can't get it anymore, I'm
told.

Can you apply this same philosphy to trawlers?  We're pretty new to
trawlering, having been at it for a little less than five years, so I have
minimal knowledge of what things cost or are worth.  But using the only
boat we are familiar with, the Grand Banks 36, you can buy a mid-1970s
version in good condition for $90,000 or so.  Having the exterior
professionally refinished (varnish and paint) will cost about $20,000.
Overhauling all the windows I'm guessing will cost about $10,000, primarily
labor.  Refinishing and overhauling the interior, plumbing, wiring, and
other systems might run $30,000.  Assuming the teak deck planks themselves
are in good shape, figure $8,000 to re-seam it, replace screws and plugs,
etc.  Let's say $60,000 to repower the boat if it's a twin.  Installing a
new generator, $10,000.  So for a rounded-up total of $250,000, you have a
"new" GB36.  If you order a brand new GB36 from the dealer, it's going to
set you back at least another $100,000 and probably more, depending on how
you equip and configure the boat.

Obviously you can spend a lot more on the older boat if you choose to have
things done that bring it up to a standard exceeding it's original build
condition and configuration.  But it would seem to my inexperienced eye
that returning an older production boat like a Grand Banks to the same
condition it was in when it was new would cost a fair amount less than
buying the same boat brand new.

There are some considerations, of course.  Grand Banks changed the GB36
mold in 1988, so a brand new GB36 enjoys some advantages (or disadvantages,
depending on your point of view) over a 1970s GB36.  The 1988 molds make
the GB36 a longer, taller, and wider boat than the original.  This
translates into more interior headroom, more storage room, a larger forward
head with a shower, and so on.  These are features you can't get in a 1970s
GB36 no matter how much money you throw at it because the molds that made
the basic boat were smaller.  But if the size of the original GB36 suits
your purposes, you can get a hell of a boat with a total overhaul/refit and
zero-time engines and still come out many dollars ahead of buying a brand
new GB36.

And like that no-longer-available transmission in my old Ford pickup, there
may be some advantages inherent in the older boat.  If you like nice wood,
for example, the teak used in an old GB36 will probably be of better
quality than the wood used in a new one due to labor and material costs,
and the fact that some kinds of teak are simply no longer available.  If
you don't like the look of wood or the effort required to keep it looking
nice, then an older GB is not the boat you want.

An older fiberglass production boat might have a stouter hull than the
newest versions simply because the builder may not have been as familiar
with the material and so tended to overbuild the hull.  I've been told this
is the case with the earlier fiberglass Grand Banks boats- I have no idea
if it's actually true.  The flip side of this is that the older boat may be
heavier than the brand new model.  This can be good, bad, or not matter
depending on how you intend to run the boat.

The very experienced skipper of a 1966 120-foot yacht I've been doing some
writing work for recently told me that it takes no more to keep an old boat
running as it does to keep a brand new one running.  The pumps, seals,
gaskets, hoses, clamps, exhaust components, and filters that wear out or
fail on an old boat are the same pumps, seals, gaskets, hoses, clamps,
exhaust components, and filters that wear out or fail on a new boat.  In
some cases, the high complexity of a new boat can result in higher
maintenance costs than on a boat 30 years older.  Obviously an older boat
may be statistically more likely to have major problems like an engine
failure, serious hull corrosion, and so on.  But the day-to-day
maintenance costs are apparently not that much different depsite the huge
difference in age.

So it would seem that bringing an old but basically sound trawler up to its
as-built condition would put you ahead of the game over buying the same or
similar model boat brand new, IF the configuration and performance of the
old boat met your cruising requirements.

C. Marin Faure
GB36-403 "La Perouse"
Bellingham, WA

Makes a lot of sense.......except that the eventual resale will not reflect
the money spent.
The new GB36 at say $350,000 will be worth around $250,000+ two or three
years later.
But how much will the 30 year old rebuild be worth??
Overcapitalisation is the name of that game and whilst we're all guilty of
it to some extent,
IMHO you'd need to keep the boat for a very long time to break even.

Glenn Williams
Universal 36 ('81 model with lots spent!)
Port Phillip
Australia.

"C. Marin Faure" wrote:
But using the only

primarily

-----Original Message-----
Glenn Williams wrote

Makes a lot of sense.......except that the eventual resale will not reflect
the money spent.

Overcapitalisation is the name of that game and whilst we're all guilty of
it to some extent,
IMHO you'd need to keep the boat for a very long time to break even.

Glenn Williams
Universal 36 ('81 model with lots spent!)

REPLY

I would like to see you use that  rationale  and apply it to the wife!
If you survive the  experience let us know how you fared? <grin>

"Eventual resale"  and "over capitalization"    are  two symptoms of what I
originally  meant by  consumerism and obsolescence.

The very fact you  make a purchase with the expectation to realize a monetary
return or break even and reduce the  whole exercise to a balance sheet equation
speaks volumes.

This is not meant as a personal  attack on your values  but  a commentary of how
our whole society  has  gradually shifted  towards a very  materialistic
outlook.
It is not surprising  that the majority of members in such a society  adopt the
common standards.
But  that doesn't mean we cannot question those standards and  work to change
them if they are found lacking in something or other.

All down through the ages, vessels have been personified  and ascribed a
character of their own; almost as if it was an entity, not just a collection of
inanimate parts.

Vessels  are typically referred to in the female gender. (And with typical
gallic perversity;  the French  uses the male gender)
A comparison has often been made between a sailors  relationship with  his
vessel and his wife or mistress. And for good reason.
Until recent times, the Captain and  crew always  thought of the vessel in terms
more akin to a relationship  such as you  had with a spouse or mate.

A question,  do women who own boats  think of the boat as having a male
personality? <VBG>

Certainly in  the context of  recreation and a voluntary association intended to
enhance personal pleasure or fulfillment  is more akin to a personal
relationship than simply the acquisition of a disposable object to be used,
abused  or misused  for personal gratification and then disposed of when
considered of no further value.

Cheers

Arild

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I originally  meant by  consumerism and obsolescence.

Arild!!!!

You done me wrong!

I have built two boats, converted a trawler and owned (and poured thousands
of dollars into) six more, including the current pride'n'joy.
My wife, to whom you so correctly referred as overcapitalised, has always
said that my boat is my passion, and she's right.
I love her anyway and I know that's just the point you're making.

I was replying to CMF's note, not having seen yours. (I was off list for a
while taking a little cruise on good 'ol overcapitalised "Stirling")

BUT.....we all have to sell 'em one day, and whilst I look upon my boat as
an investment in my wellbeing, a passionate hobby, a floating holiday home
and a wonderful
retreat, I just dont have the wherewithall to ignore resale completely.
If I did, maybe I'd buy a new one and tip some more into that new hole in
the water. But then, I've never had a new one.
It just couldn't be more fun than discovering all those interesting little
things the surveyor missed. Heh heh.

Cheers.
'Ol beancounting Glenn.

REPLY
A boat that is used often is cheaper to own than a boat that is rarely used.
The return on the buck is much higher on the more active boat. It is the
"slip-hugger" that is a waste of money.

                            Ralph Salerno
                            M/V ANCORA

How true. One thing to think about is your insurance coverage after a
major refit. I'm going to get my Krogen re-surveyed to reflect all of
the work I've done to it, including upgrades and new equipment, to give
a realistic value to my insurance company. I've added probably $30,000+
in new equipment like radar, SSB, bow thruster, liferaft, etc. Also
repaired the bottom blisters, etc.

The nice thing about all this is that now I've paid what some of the
"high end" Krogens would have cost in their condition, but I KNOW how
all this stuff was installed, and that it's all new. Things like all new
seacocks and hose from them, new sanitation system, etc. make me really
comfortable with the condition of the boat.

I'll never see a return on this investment, as I can vouch for the fact
that MOST folks don't care what shape a boat is in, how it was cared
for, etc. They'll just look at three similar models and pick the one
with the lowest price, regardless. Just get used to this when you get to
sell your beloved boat.

ralph wrote:

--
Keith
__
A Freudian slip is when you say one thing but mean your mother.