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Why the cost???
- Thread starter db71
- Start date
People have gotten used to WalMart pricing. That same $3 plastic bowl would have cost you $30 in today's dollars if it were still made in the US. Can you imagine if things like televisions were still made here? And take a look at cars- $25K is the magic price point for a mid-size car.
Everyone wants to make a fair wage and live a good life. But they want a steady flow of cheap goods. If you want a WalMart boat, it's going to say Bayliner on the side. If you want a hand-built performance boat, they cost.
Everyone wants to make a fair wage and live a good life. But they want a steady flow of cheap goods. If you want a WalMart boat, it's going to say Bayliner on the side. If you want a hand-built performance boat, they cost.
old377guy
Charter Member
Great thread. I've asked myself the same questions that db posed regarding boats and also my own business. I'm certain that every manufacturer has been told how much he should be selling his products for by his distributors/dealers/end customers. The wise producer files that information under "market feedback" and uses it in future pricing/production deliberations. In the final analysis the producer needs to price as high as the market will bear not necessarily from greed but from prudent management of year to year revenue bridging. Most businesses know that larger than "average" profits in any cycle are what they use to build up a warchest for the lean years. Every CEO that isn't asleep at the wheel is painfully aware that people vote with their dollars and that an overpriced item just plain won't sell. One of the reasons that I own an old boat is that considering my circumstances, I just can't justify the price of brand new machinery; I'm not upset with the manufacturer and their markups, they are the ones who have to live with the consequences of their marketing philosophy.
Dude! Sweet!
Charter Member
It's funny. I just built my first high performance four stroke engine. I was talking to someone the other day and I said that everyone who buys a hp engine should be required to go through the entire build process on one of these.
I HAVE to have at least 100 hours into this thing. Nothing snaps together like an AMT model kit. Even high end parts all require custom, labor intensive machining and fitment. I've built a number of two stroke bike and kart motors and have done partial engine assembly on low perf street car engines so it's not like the whole thing was an alien process to me...
I will never again wonder where Pfaff and guys like that get off charging $50k for a motor. And stuff that's easy doesn't make ya smile like doing something hard... :sifone:
I HAVE to have at least 100 hours into this thing. Nothing snaps together like an AMT model kit. Even high end parts all require custom, labor intensive machining and fitment. I've built a number of two stroke bike and kart motors and have done partial engine assembly on low perf street car engines so it's not like the whole thing was an alien process to me...
I will never again wonder where Pfaff and guys like that get off charging $50k for a motor. And stuff that's easy doesn't make ya smile like doing something hard... :sifone:
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Bobcat
Founding Member
I'll side with you on that......and when you see build pics in Magazines a lot of the people in the background look like they would be hard pressed to show you a Green card
JupiterSunsation
New member
Hey I think if they can make performance boats just as reliable as performance cars then they can charge whatever they want. New Corvette Z06 is warranteed for 5 years/100K miles (Powertrain). Motor is far more complex than a 525 so why can't Mercury give me that same warranty?
Walmart appeals to the masses = lower pricing. Performance boat builders appeal to less than 5% (maybe 1%) of the boat market making it a niche, a shrinking niche at best.
JupiterSunsation
New member
i'll side with you on that......and when you see build pics in magazines a lot of the people in the background look like they would be hard pressed to show you a green card
+1
PARADOX
Founding Member
Having some discussions with Merc lately.. they admit.. and know that High Perf motors are driven hard, and won't last as long as a 502 in a cruiser. thus the one year warranty. Being a busines decesion... I can understand that.. however.. I hate the "time frame" warranty.. Guys in North won't use the boat for 3-4 month out of the year. 3-4 months of warranty down the drain.. Mec should have a warranty based on hours of use and certain hours in certain RPM range. I just had my hours pulled from the CPU. 100 hours under 2000 RPM. 50 from 2500 to 4500.. 2-3 above 4500.. Now I have issues..go figure.
However.. cars even HP cars run around 2000-3000 RPM range most of the time. Perf. boats run above 4000 a bunch. It's like driving a vet in 2nd gear most of the time and doing 120 MPH... how long would that last?
Like I said.. I understand the story, just don't like it.
macjazzy
Charter Member
You guys seem all to be concentrating on the hull, why does a fairly simple big block chevy engine, based on 20 year old technology cost 30k ? How about drives? 10k +/- for a bravo drive they have been manufacturing for 20 years?
When you come out with a brand new whatever, you have to factor in the cost of the manufacturing equipment needed, casts, engineering costs etc. For most of the stuff Merc makes these costs should have been absorbed years ago. Why do these engines go up in price every year but the technology in them not change much?
Compared to any modern engine or trans in any mid level auto the engineering and technology in marine engines and drives is way way behind. Why are they still charging state or the art prices for old school technology?
When you come out with a brand new whatever, you have to factor in the cost of the manufacturing equipment needed, casts, engineering costs etc. For most of the stuff Merc makes these costs should have been absorbed years ago. Why do these engines go up in price every year but the technology in them not change much?
Compared to any modern engine or trans in any mid level auto the engineering and technology in marine engines and drives is way way behind. Why are they still charging state or the art prices for old school technology?
fund razor
Founding Member
That is exactly why I built from scratch instead of buy crate mercs.
60 grand in engines for a 35k boat? F that.
JupiterSunsation
New member
See post #16.........Mercury would be a good place to start realigning pricing.
Hull maybe the easiest thing to pick on since it is the largest piece and the starting point for every boat!
Dude! Sweet!
Charter Member
A buddy of mine jokes that when you buy one 525 Merc, you're really paying for two. The one you bought and the one you'll get on warranty when you snuff the first one...
John, how many hours do you have in the assembly of your motors (excluding parts costs)?
I'd hate to pay $30k a side for motors, but if they're done right, it's worth every penny.
Dude! Sweet!
Charter Member
On the hull side, I have struggled with the cost as well, especially when considering the cost of a no liner, no cabin race hull. One of my buddies does a lot of fiberglass molding and I think we came out with something like half the price I've been quoted for a bare hull and deck if they had the molds and his guys were doing the glass work.
That said, I think there is an intangible value that needs to be place on knowlege and experience that goes beyond labor rate x hours + materials...
That said, I think there is an intangible value that needs to be place on knowlege and experience that goes beyond labor rate x hours + materials...
Offshore Ginger
New member
I have to say that when i started out doing fiberglass repair at Thompson boats here in Mich well over thirty plus years ago , starting wage was 4.35 an hour , and hourly wage in todays market depends on experience and the company and seeing that we have such a failing economy and the industry is at an all time low along with so many talented people out of work here in Mich alone and everywhere else .I have to say that the ones that are working are just thankful to have a job and what a shame that a skilled person in the marine industry makes less then a guy who works for GM twisting four bolts , because building and repairing boats is a dirty nasty job and i love it .
macjazzy
Charter Member
I can almost see hand built specialty engines costing 20-30k. All the parts must be individually selected, fitted by hand. Often times redone several times to get all the clearances correct, dissasembled to be painted or otherwise finished, dyno time to get the setup right etc..
But for production engines, even the blue ones, that seems tough to justify to me. Even being hand build they are built in an assembly line style manner. All 525's have a "recipe" of parts required that Merc has already sourced and bought at groupd sale prices prices. Much different than your local builder buying one set of pistons or whatever at a time.
And the labor is not substantially different to put together a 525 efi or a 425Mag HO engine.
And as for the warranty being built into the price. That would be true, but being as that blue engines carry only a 1 year warr. and the black ones a 3 year ( I think ) warr and they are now on a time clock. I doubt very seriously there are more Merc warr costs with Blue engines vs. Black engines.
All the same things apply to drives if not more so. How long has the 6 drive been out? You don't think they have paid for the manufacturing costs of that drive yet? The casts aren't paid for yet?
And I thought it was basically bullet proof behind 99% of pleasure boat engines its installed in. So don't even try to give me their excuse being warr costs on that one. Why do their prices not only not go down but increase every year? Or Bravo's or Alpha's or whatever drive you want to add into this discussion.
But for production engines, even the blue ones, that seems tough to justify to me. Even being hand build they are built in an assembly line style manner. All 525's have a "recipe" of parts required that Merc has already sourced and bought at groupd sale prices prices. Much different than your local builder buying one set of pistons or whatever at a time.
And the labor is not substantially different to put together a 525 efi or a 425Mag HO engine.
And as for the warranty being built into the price. That would be true, but being as that blue engines carry only a 1 year warr. and the black ones a 3 year ( I think ) warr and they are now on a time clock. I doubt very seriously there are more Merc warr costs with Blue engines vs. Black engines.
All the same things apply to drives if not more so. How long has the 6 drive been out? You don't think they have paid for the manufacturing costs of that drive yet? The casts aren't paid for yet?
And I thought it was basically bullet proof behind 99% of pleasure boat engines its installed in. So don't even try to give me their excuse being warr costs on that one. Why do their prices not only not go down but increase every year? Or Bravo's or Alpha's or whatever drive you want to add into this discussion.
phragle
Charter Member
Once again... I will make something simple for you guys...
You want to buy boats, motors, etc.. more than they need to sell them.
People want stuff and they are willing to pay X amount of dollars for said stuff. If they weren't willing to pay X amount of dollars the boat and motor companies wouldnt sell product and would either disappear or drop their prices.
If I make a widget, I m going to sell you that widget for as much as I can. I am in buisness as a widget maker to make money for myself, not save you money. My widgets may be expensive, but they are the fastest safest and coolest widgets ever to have autoclaved prepregged zip lock baggied whippled charged bling! Comeon..send me that AMEX number..you need widgets and Daddy needs a nw pair of shoes!!!
What it costs me to make widgets is absolutely irrelevant, all that matters is that you think my widgets are cool and buy them, but if you order now, I will throw in a Phragle's Widgets baseball cap free!! just pay shipping....
You want to buy boats, motors, etc.. more than they need to sell them.
People want stuff and they are willing to pay X amount of dollars for said stuff. If they weren't willing to pay X amount of dollars the boat and motor companies wouldnt sell product and would either disappear or drop their prices.
If I make a widget, I m going to sell you that widget for as much as I can. I am in buisness as a widget maker to make money for myself, not save you money. My widgets may be expensive, but they are the fastest safest and coolest widgets ever to have autoclaved prepregged zip lock baggied whippled charged bling! Comeon..send me that AMEX number..you need widgets and Daddy needs a nw pair of shoes!!!
What it costs me to make widgets is absolutely irrelevant, all that matters is that you think my widgets are cool and buy them, but if you order now, I will throw in a Phragle's Widgets baseball cap free!! just pay shipping....
htrdlncn
New member
base for black engines and even a few blue engines is nothing fancier
than a good ole GM crate motor. Merc buys them and slaps accesories and paint on it and there ya go.
as for price like everything its waht the market will bear. If people dont pay a premium price goes down if people are willing to pay price goes up, a lot of times its for "perceived" value not actual value.
Take SUVs, extremely profitable for companies like Ford to take a regular old
Expedition add a couple hundred bucks of leather and electronic doo dads and charge
12-17K extra for it. In fact for many years the Navigoater was the vehicle they made the most profit per volume yet they sold a ton of them because most people perceived that it was worth extra premium when in fact its just a dressed up Expedition.
(just using it as example, most car companies do this with many models)
My beef is with things like headers,, with todays machines (computer controled welding+cnc) there is no reason whatsoever for marine headers to cost anywhere from 2 to 5 grand a pop. And dont tell me its because of the cost of the machines, a lot of custom fabricators share machines or use other shops for a fee so there isnt that big investment and being as 90% of all boats use Merc engines with pretty standard mounting its not like your reinventing the wheel everytime you make one.
Why then do they charge so much?
Because people buy them,plain and simple.
Why sell any cheaper is people will pay high dollar for them?
There is a market and the people in that market have the funds to pay and not care if costs 2-3 times what it should.
What is really messed up is that most those expensive headers are expected to fail in a couple years and is considered normal. :O
than a good ole GM crate motor. Merc buys them and slaps accesories and paint on it and there ya go.
as for price like everything its waht the market will bear. If people dont pay a premium price goes down if people are willing to pay price goes up, a lot of times its for "perceived" value not actual value.
Take SUVs, extremely profitable for companies like Ford to take a regular old
Expedition add a couple hundred bucks of leather and electronic doo dads and charge
12-17K extra for it. In fact for many years the Navigoater was the vehicle they made the most profit per volume yet they sold a ton of them because most people perceived that it was worth extra premium when in fact its just a dressed up Expedition.
(just using it as example, most car companies do this with many models)
My beef is with things like headers,, with todays machines (computer controled welding+cnc) there is no reason whatsoever for marine headers to cost anywhere from 2 to 5 grand a pop. And dont tell me its because of the cost of the machines, a lot of custom fabricators share machines or use other shops for a fee so there isnt that big investment and being as 90% of all boats use Merc engines with pretty standard mounting its not like your reinventing the wheel everytime you make one.
Why then do they charge so much?
Because people buy them,plain and simple.
Why sell any cheaper is people will pay high dollar for them?
There is a market and the people in that market have the funds to pay and not care if costs 2-3 times what it should.
What is really messed up is that most those expensive headers are expected to fail in a couple years and is considered normal. :O
PARADOX
Founding Member
I understand and agree with most of the comments. My issues is with the costs/profits.. etc... is that we fraking nuts who are buying the blings.. if there is something wrong.. needs to be fixed... Merc. CMI and all the rest of the marine companies should take care of it, or at least stand up to the plate and service the consumers, whom made it possible for all the CEO's and boat builders to drive thier Lambos.
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