(FT. LAUDERDALE, FL) -- During this past week's Ft. Lauderdale International Boat Show, Viking Yachts sales director Joe Schwab seems to have taken a page from many U.S. homebuilders playbook to deal with a slow economy - control inventory levels.
According to Schwab, Viking Yachts is enjoying brisk sales at the 2010 show. "We had only 3 yacht sales during the 2009 boat show, and this year's show we had a 400% increase in sales to a total of 12 transactions as of Sunday, with several more pending sales orders possibly coming in within the next few weeks from the show," said Schwab.
Viking Yachts sells high-end sport fishing boats from 42' up to 82' with prices ranging from $1 million to over $8 million.
When asked what was the key to stabilizing yacht prices, Schwab replied, "Inventory control."
The Schwab further commented, "We are now producing about 30% of our normal factory production levels, leaving less inventory on the market for our dealers or ourselves to worry about. This also allows us to better control downward pricing pressure with less boats being available on the market. It is a classic supply-demand issue that we have been able to use to hold the line on our pricing - and it is working - we are selling as evidenced in this week's show."
Over the last 2 years many U.S. homebuilders have followed this same strategy and dramatically cut back their new home inventories to reduce financial exposure and downward pricing pressures.
$3 billion - total value of boats & accessories on display
3 million plus - total square footage of space on land and in the water
5 - number of venue sites for the boat show
100,000 - estimated number visitors to boat show
1,200 - number of boats on display
1,000- number of exhibitors
264 tons - carbon dioxide pollution prevented by carbon offsets purchased by Show Management
281 - length in feet of the 'Cakewalk', the largest boat built in the United States
8,500 - range in nautical miles on a tank of fuel for the 247-foot 'Northern Star'
Brad Lazzara of Tampa-based Lazzara International Yacht Sales stated, "We are seeing both an increase in foot traffic and in the number of qualified buyers who can afford our product." Lazzara sells high end luxury yachts in the $4 million to $17 million range primarily to business owners and entrepreneurs in the U.S., Latin America and Europe.
Lazzara further commented, "We see a slight improvement in sales 2010 over 2009, but buyers need to be both financially qualified and mentally motivated - before any sale can occur."
In light of this week's boat show sales trends, luxury boat buyers seems to have now found both their check books and desire to have fun on the water again.