Two boating companies on opposite sides of Tampa Bay are banding together to sell superyachts to the wealthy.
MarineMax of Clearwater, the country's No. 1 boat retailer, has signed a deal to become the sole distributor for Westship World Yachts, a Tampa builder of custom luxury ships that are 100 to 150 feet long and priced at $8-million to $18-million.
The pact plugs a hole at the high end for MarineMax, which had no established vendor for boats longer than 100 feet. It gives Westship, with a lone sales office in Fort Lauderdale, access to a 60-store, 13-state network of salespeople.
Given the ailing economy and stock market, not to mention the threat of terrorism, the market for yachts requiring a full-time crew and up to $2-million for annual upkeep might seem thin.
While sales of "blue collar entry level" boats are flagging, MarineMax chief executive Bill McGill said, the very wealthy _ "people with discretionary income," he calls them _ are buying floating mansions with zeal.
Not that the business of building luxury yachts is a sure thing. Westship's manufacturing facility, on Rattlesnake Point just south of the Gandy Bridge, is a virtual graveyard of yacht-builders. Its previous owner, Trident Shipworks, went bankrupt in 1999. Westship bought most of the assets a year later for about $4.5-million.
Privately held Westship isn't likely to run out of cash any time soon. Company officials declined to identify its hush-hush owner, but public records show it is owned by Cape Clear LLC of Hopkington, Mass., an investment vehicle that is in turn owned by the family of Massachusetts billionaire Richard Egan.
Egan, who recently resigned as the Bush administration's ambassador to Ireland, made his fortune as the co-founder of data storage company EMC Corp. He is ranked the world's 348th richest person by Forbes magazine.
Such financial heft has helped Westship build its boat repair and retrofit business by purchasing a hoist capable of lifting 300-ton vessels. Cape Clear also is footing the bill for construction of a 143-foot, nearly 500,000-pound yacht. It will be completed by July but does not have a buyer, making it a so-called spec boat.
One recent afternoon at the company's plant, workers sanded smooth the hull's fiberglass exterior, dug channels for wiring into lightweight walls and cut cherry wood for the boat's built-in furniture and cabinetry.
A non-Westship yacht, the Ivory Lady, was awaiting a new paint job, which costs from $150,000 to $500,000. On the water, a 103-foot Westship sport yacht was getting a maintenance checkup as well as some upgrades, including a small powerboat and a three-person water scooter.
"They want more toys," manufacturing vice president Roger Emery said, "and we like to put them in."
The customer profile for such yachts is narrow, said Tom George, a sales executive at MarineMax's Clearwater store. Those most likely to sign a check for $18-million are men in their 40s who recently sold their business and already own a sizable yacht, as well as a private jet. Inquiries about financing are a "red flag," he said.
"There may be 1,000 customers in the world for these types of boats," said Westship executive Pat Shea, who works out of the company's Massachusetts office.
Under the new arrangement, publicly traded MarineMax will handle sales and marketing, while its brokerage service takes care of customer trade-ins. Its current database of customers are considered the prime targets. MarineMax also will handle what may be the most challenging part of the sales process: finding the right crew for its usually demanding buyers.
Westship will run as many as two 10-hour shifts a day in order to trim its delivery time. Manufacturing chief Emery and his crew will work with MarineMax sales representatives to accommodate customer requests, from full compression scuba diving systems to helicopter landing pads.
Even if MarineMax sells all four ships Westship plans to build this year, the proceeds won't have a substantial impact on its income statement, which showed revenues of $541-million in 2002.
MarineMax's commission will probably be less than 5 percent of the sales price, sales executive George said. Part of that money will go toward the cost of staff training, marketing and an average of two to three years of "courting" each buyer. Associated expenses include meals and travel. MarineMax sometimes picks up a client in the company plane.
Even after the customer decides to buy, there are hundreds of design and decor decisions to be made as construction proceeds, and 12 to 18 months more of hand-holding. Such clients are "used to having their own way all the time," said Alan Hollison, Westship's vice president of operations.
It's worth the time and trouble not only to make a big sale but to keep a customer for the next time around. The average MarineMax customer keeps a yacht less than two years.
"I don't care if he's buying an 18-foot boat or a 200-foot boat," sales executive George said. "Some move up in size, some go back down. Very few get out."
_ Times researcher Cathy Wos contributed to this report. Scott Barancik can be reached at baranciksptimes.com or (727) 893-8751.
No luxury spared
Some features of the 143-foot long, $17.7-million yacht under construction at Westship World Yachts of Tampa:
+ Interior living space: 5,447-square-feet on four levels
+ Gold-plated faucets, shower heads and bar fixtures
+ Five bedrooms and five full baths
+ Four cabins and baths for crew
+ Custom built-in furniture and cabinetry of cherry wood
+ Desalinates 2,400 gallons of seawater per day
+ Redundant power generators
+ Full dive center with two waverunners
+ Gynasium with weights, treadmill and stairmaster
+ Satellite telephone and television
+ Maximum speed: 36 MPH
+ Weight: 480,000 pounds
+ Fuel capacity: 11,000 gallons
Source: MarineMax Inc.
Since going public in 1998, MarineMax Inc. of Clearwater has added ever-larger boats to its retail portfolio, most recently those manufactured by Westship World Yachts of Tampa.
Make Length Price
Westship 103 to 150 feet $8-million to $18-million
Hatteras 50 to 100 feet $1-million to $8-million
Meridian 35 to 58 feet $200,000 to $1-million
Sea Ray 17 to 68 feet $81,500 to $3.1-million
Boston Whaler 12 to 29 feet $5,000 to $190,000
Source: MarineMax Inc.
Workers sand the fiberglass exterior of a 143-foot ship at Westship World Yachts last week. When it's done in July, it will weigh nearly half a million pounds.