Presuming Ed

Oyster Yachts gone bust

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Sterling has dropped ~15% since the Brexit vote. I dunno what proportion of Oyster's cost base derives from outside the UK, but if they had been taking build contracts in pounds to buy supplies priced in Euro or USD, that will have hurt badly

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Someone please tell me why an existing larger boat dealer and manufacturer such as Swan, J boats or Beneteau might not be a good candidate to take over oyster yachts and run it as a separate entity?

It would seem that there would be a significant costs savings from eliminating redundant positions as well as additional cost savings from centralized HR, insurance, legal representation design, etc.

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27 minutes ago, Parma said:

Someone please tell me why an existing larger boat dealer and manufacturer such as Swan, J boats or Beneteau might not be a good candidate to take over oyster yachts and run it as a separate entity?

It would seem that there would be a significant costs savings from eliminating redundant positions as well as additional cost savings from centralized HR, insurance, legal representation design, etc.

Why ?  

The competition  want to kill them...not make more boats.

the market is glutted and the consumer base is shrinking.

Demographics is real

 

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2 hours ago, LB 15 said:

Slugs sister...

 

She should emigrate so she can vote for Trump.

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12 minutes ago, SloopJonB said:

She should emigrate so she can vote for Trump.

But the borders are shut...

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I stopped by the dealer before I flew home today, and they're already out of the 102s. You can still get an 825, but who can fit into one of those?

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2 hours ago, LB 15 said:

But the borders are shut...

She's white and speaks a sort of English.

Trump can grab her pussy.

 

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18 hours ago, Glenn McCarthy said:

The U.S. has two types of bankruptcies, the first where the business goes to court seeking to "re-organize" by showing the judge if the judge would reduce their debt owed to suppliers, and if they made other changes that prove that the business can function profitably.

The second is where the suppliers force a bankruptcy and liquidation so the assets are sold off and they get their debts repaid.

Does England offer both of these systems too?  And with a 4 year backlog of orders, why wouldn't a reorganization be better than a liquidation?

 

 

Administration in the UK is similar to Chapter 11 in the US. Administration allows for a deal to be done with creditors, possible re-organisation, debt reductions, write-offs etc.

The UK also has your second scenario, called something like a Creditors' Liquidation.

(Caveat - I have never stayed at a Holiday Inn.)

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13 minutes ago, Black Sox said:

Administration in the UK is similar to Chapter 11 in the US. Administration allows for a deal to be done with creditors, possible re-organisation, debt reductions, write-offs etc.

The UK also has your second scenario, called something like a Creditors' Liquidation.

(Caveat - I have never stayed at a Holiday Inn.)

If some 18th century novels are realistic, a Creditors' Liquidation involved large men at your house carting off all your shit.

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Maybe another mid-range luxury English yacht builder, Sunseeker, wants a sailing line to complement their motor line. I doubt they have the money for an acquisition considering they're yacht builders though.

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16 minutes ago, Mark Set (BIMBO Local 713) said:

Maybe another mid-range luxury English yacht builder, Sunseeker, wants a sailing line to complement their motor line. I doubt they have the money for an acquisition considering they're yacht builders though.

i think they probably have tons of money - they are building motor yachts.., probably selling record numbers! 

of course, so was Oyster, so you never know..

anyway, i don't think any motorboat company would be stupid enough to get into the sailing business - i know a few have over the years, but it would be really dumb

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Talking to many boat builders and brokers, a recurring theme is that the sales cycle (contact to sale) for a powerboat is a few days, for a sailboat its a few years.

There is a reason all the sailboat manufacturers have such high owner loyalty: there is really no other way to survive.

So I am quite certain Sunseeker would not even think about buying Oyster for a second.

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1 hour ago, us7070 said:

i think they probably have tons of money - they are building motor yachts.., probably selling record numbers! 

of course, so was Oyster, so you never know..

anyway, i don't think any motorboat company would be stupid enough to get into the sailing business - i know a few have over the years, but it would be really dumb

Sunseeker went belly up a few years ago and the Chinese bought them 

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20 hours ago, slug zitski said:

the market is glutted and the consumer base is shrinking.

Demographics is real

Not so.  This end of the market is not shrinking.  It's thriving.

Smaller yachts face a shrinking market, but demand is growing for Oyster's products: million-pound-plus vehicles for taking a couple plus optional family and guests) on long cruises.

As the poor get poorer and the middle gets squeezed, quantitative easing has poured cash into the pockets of the 1% who buy this sort of boat.

Technological advances have made pushbutton sailing a reality, eliminating the gap between the 40-footer which a couple could handle with 70s gear, and the crewed 65-footer. 7

So even without a paid crew, a middle-aged couple can now wander around the oceans on a large comfortable yacht. The technology has  lowered the entry price, because replacing the paid crew with gadgets means the same level of owner amenity can be found in a boat ten or 15 feet shorter than was needed with paid hands, and £50K a year is lopped off running costs.

And the 1% now has the cash to buy this newly-viable size of boat.

Oyster knows this market and serves it well. That's why the business has been growing and the order book is healthy.

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10 minutes ago, TwoLegged said:

Not so.  This end of the market is not shrinking.  It's thriving.

Smaller yachts face a shrinking market, but demand is growing for Oyster's products: million-pound-plus vehicles for taking a couple plus optional family and guests) on long cruises.

As the poor get poorer and the middle gets squeezed, quantitative easing has poured cash into the pockets of the 1% who buy this sort of boat.

Technological advances have made pushbutton sailing a reality, eliminating the gap between the 40-footer which a couple could handle with 70s gear, and the crewed 65-footer. 7

So even without a paid crew, a middle-aged couple can now wander around the oceans on a large comfortable yacht. The technology has  lowered the entry price, because replacing the paid crew with gadgets means the same level of owner amenity can be found in a boat ten or 15 feet shorter than was needed with paid hands, and £50K a year is lopped off running costs.

And the 1% now has the cash to buy this newly-viable size of boat.

Oyster knows this market and serves it well. That's why the business has been growing and the order book is healthy.

Oh yah ...

http://www.camperandnicholsons.com/state-of-wealth/2016-first-half/index.html#1

 

IMG_8078.PNG

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A right wingers paradise is nearly upon us.

Just think of all those jobs building and maintaining (but not crewing) all those gigantic toys.

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Just now, SloopJonB said:

A right wingers paradise is nearly upon us.

Just think of all those jobs building and maintaining (but not crewing) all those gigantic toys.

Look servile while you scrub those decks, minion!  And don't you dare make eye contact with my family.

Then sod off back to your own homeless family, and don't wake us when you return at sunrise to lick the heads clean

:(

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Oyster is going "bust" so that they can reorganize to avoid the liability of the keel fiasco.  They will go through a suitable period of ominous press releases, scare their employees, depositors and suppliers to maintain the charade, and re-emerge with a "white knight", who will secretly be the same investment group that owns then now, with some lipstick and subterfuge. 

You heard it here first.

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3 minutes ago, SloopJonB said:

Sluggo is kind of pitiable.

I'm still working through the surprise phase.  When I've done mockery and contempt, maybe  I'll move on to pity

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1 minute ago, sailforbeer said:

Oyster is going "bust" so that they can reorganize to avoid the liability of the keel fiasco.  They will go through a suitable period of ominous press releases, scare their employees, depositors and suppliers to maintain the charade, and re-emerge with a "white knight", who will secretly be the same investment group that owns then now, with some lipstick and subterfuge. 

You heard it here first.

Yep.  Burn the creditors, burn the staff, keep the profits rolling.

The investors must not bear the losses, old chap.

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48 minutes ago, slug zitski said:

I guess that tells the whole story as to why motor yacht builders dont want to make sailboats. Motoryacht buyers want new boats not someone else's used boat. 

But wasn't Oyster bragging on $80M worth of orders just a few weeks ago? Seems someone could trim the fat and keep the doors open with those orders in hand.

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22 hours ago, Parma said:

Someone please tell me why an existing larger boat dealer and manufacturer such as Swan, J boats or Beneteau might not be a good candidate to take over oyster yachts and run it as a separate entity?

It would seem that there would be a significant costs savings from eliminating redundant positions as well as additional cost savings from centralized HR, insurance, legal representation design, etc.

I bet these guys will be taking a look. http://www.grandlargeyachting.com/en/

They bought Gunboat and Outremer when they went belly up.  Not sure of  how they aquired their other bands. 

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11 minutes ago, Mark Set (BIMBO Local 713) said:

I guess that tells the whole story as to why motor yacht builders dont want to make sailboats. Motoryacht buyers want new boats not someone else's used boat. 

But wasn't Oyster bragging on $80M worth of orders just a few weeks ago? Seems someone could trim the fat and keep the doors open with those orders in hand.

 hmm...80m$

Have you ever met an honest yacht broker ? 

As you can see the global market for 20 meter plus sailboats is  very small

perhaps oyster can find a sugar daddy. 

these sugar daddies are how many builders survive.

 

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someone will buy the dregs and the good bits........this is just a game of numbers with the hands off players.....the orders were not in a company under admin and neither is the IP.......everything else is quickly replaceable at huge discount.......SA should take up a collection for a train load of  KY Jelly  for the little guys.........

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36 minutes ago, TwoLegged said:

Yep.  Burn the creditors, burn the staff, keep the profits rolling.

The investors must not bear the losses, old chap.

By rights the Government should.

Isn't that the right wing credo? Privatize profits and socialize losses?

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4 minutes ago, SloopJonB said:

By rights the Government should.

Isn't that the right wing credo? Privatize profits and socialize losses?

They are mostly open-minded about it. The losses can be absorbed by employees, suppliers, customers, or government — anyone but the investors.

Most of these tactical receiverships are handled by sharing the losses among victims.  But govt is there to pick up any shortfall, esp with the really big collapses like the banks in 2008 where govts wrote cheques for the whole bill, and then threw several times as much after it as "quantitative easing" (UK) / "fiscal stimulus" (USA).  The asset price inflation caused by those utterly-botched  stimuli is what underpins the market Oyster sells into.

 

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3 minutes ago, LeoV said:

Net worth owner of HTC, who owns oyster;

455 mil Euro.

Far too rich to bear the £5million bill (at a guess) for the Polina Star III debacle.  When you're that wealthy, you have the power to make others pay

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The 5 million was moving hadquarter cost and Polina star suit.

Reason he bought it, to own an Oyster and instead of paying for maintenance, buy the yard.

I think he and his partner in HTC both owned an Oyster.

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One new powerboat needed, at least the cat got rescued; Ordisi  is the name of the yacht. Happened at Astilleros Astondoa

 

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2 hours ago, TwoLegged said:

Not so.  This end of the market is not shrinking.  It's thriving.

Smaller yachts face a shrinking market, but demand is growing for Oyster's products: million-pound-plus vehicles for taking a couple plus optional family and guests) on long cruises.

As the poor get poorer and the middle gets squeezed, quantitative easing has poured cash into the pockets of the 1% who buy this sort of boat.

Technological advances have made pushbutton sailing a reality, eliminating the gap between the 40-footer which a couple could handle with 70s gear, and the crewed 65-footer. 7

So even without a paid crew, a middle-aged couple can now wander around the oceans on a large comfortable yacht. The technology has  lowered the entry price, because replacing the paid crew with gadgets means the same level of owner amenity can be found in a boat ten or 15 feet shorter than was needed with paid hands, and £50K a year is lopped off running costs.

And the 1% now has the cash to buy this newly-viable size of boat.

Oyster knows this market and serves it well. That's why the business has been growing and the order book is healthy.

And just look where they are now!!!

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13 minutes ago, mad said:

And just look where they are now!!!

Haha, Mad.

But seriously, where they are now is offloading debt.

Demand for the product remains high.  The problem is a different height issue: Polina Star III's waterline ending up several hundred metres higher than her bootstripe

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1 hour ago, TwoLegged said:

Haha, Mad.

But seriously, where they are now is offloading debt.

Demand for the product remains high.  The problem is a different height issue: Polina Star III's waterline ending up several hundred metres higher than her bootstripe

A cynical but truthful statement.  

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6 hours ago, SloopJonB said:

A right wingers paradise is nearly upon us.

Just think of all those jobs building and maintaining (but not crewing) all those gigantic toys.

How much crew is needed to keep the keel attached?

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7 hours ago, TwoLegged said:

Not so.  This end of the market is not shrinking.  It's thriving.

Smaller yachts face a shrinking market, but demand is growing for Oyster's products: million-pound-plus vehicles for taking a couple plus optional family and guests) on long cruises.

As the poor get poorer and the middle gets squeezed, quantitative easing has poured cash into the pockets of the 1% who buy this sort of boat.

Technological advances have made pushbutton sailing a reality, eliminating the gap between the 40-footer which a couple could handle with 70s gear, and the crewed 65-footer. 7

So even without a paid crew, a middle-aged couple can now wander around the oceans on a large comfortable yacht. The technology has  lowered the entry price, because replacing the paid crew with gadgets means the same level of owner amenity can be found in a boat ten or 15 feet shorter than was needed with paid hands, and £50K a year is lopped off running costs.

And the 1% now has the cash to buy this newly-viable size of boat.

Oyster knows this market and serves it well. That's why the business has been growing and the order book is healthy.

This is so true. An example is the largest man made marina in the world (still?) where my business is based.  A huge makeover is in progress that primarily involves pulling out  smaller slips and replacing them with larger slips that will cater to those able to afford larger and more easily handled yachts. It is now not uncommon to see yachts in the 80' to 100' range transiting or staying. I have also noticed a significant pick up of clients engaging me to survey newer yachts in the 40' to 60' range. 

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It's interesting that Discovery Yachts have just closed out their crowd funding campaign, extended and oversubscribed, whilst the Oyster debacle was hitting the news.  There would appear investors (rather, people), still willing to back the industry.   I didn't go as far to engage a prospectus, though sure some on SA may have, so not sure of the investment profile or intended allocation of the working capital.  However, one thing that surprised me about Discovery's funding target was how small the target actually was, which would appear 'small change'.  They could have easily hit up one of their well-heeled clients to chip in some extra coin.  It shows how thin the margins in that business really are.

Discovery's acquisition of Southerly draws parallels of what Gunfleet could do with Oyster, if RM so chose to become that 'White Knight:".  However, an approach by Sunseeker under new Chinese ownership would be equally probable.  For Dalian Wanda, Oyster Yachts would not even be a financial footnote (see link below) but would add to their stable of "prestige" after paying GBP320mio for Sunseeker.  Though Wanda are presently going through their own domestic machinations that could limit participation.    
http://www.telegraph.co.uk/finance/china-business/10129196/Chinas-Wanda-buys-Sunseeker-Yachts-and-invests-in-London-skyscrapers-in-1bn-UK-deals.html

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Press information for immediate release: 8.2.18


Discovery Yachts Group exceed their funding target There is buoyancy in yacht building on Southampton Water. Discovery Yachts Group has secured crowd funding in excess of £2 million in less than a fortnight, comfortably exceeding their target of £750,000.
 

CFO, Keith Watson is delighted by this show of confidence in the brands and the management team; “In April 2017 we took two great sailing boat builders back to the market place and got these beautifully designed yachts back on the water. This new crowd funding initiative has shown that investors large and small have confidence in what we have achieved and our plans for future development. We decided to significantly overfund our initial target of £750k to ensure we had financial resilience and fire power for the challenges ahead.”

Despite the liquidation of Oyster Yachts there is clearly optimism in mid to high-end yacht market. Managing Director, Sean Langdon comments; “It is disappointing to see a world-renowned brand such as Oyster going into administration and the collateral damage that leaves in its wake. But our business is growing and we have been able to offer a significant number of jobs to ex Oyster employees so far and hope to do more.”

There have also been approaches from existing Oyster customers who currently have yachts in build. Discovery Yachts Group is working on an acceptable way forward to accommodate them and finish their yachts.

The future is looking bright for Discovery Yacht Group according to Langdon. “We have successfully turned around two businesses in less than a year and we are ready for another. We have a robust financial position and are actively looking for opportunities to grow the group of companies in our portfolio.” ENDS

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I was just speaking to a boatbuilder..big company..and asked about oyster.

his opinion was that the legal , financial, liability from the lost keel is substantial.

this yard is interested in purchasing the unfinished large yacht hulls that oyster presently has .

 

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14 hours ago, slug zitski said:

 Have you ever met an honest yacht broker ? 

Yes many. Good god you are an insufferable prick. 

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16 minutes ago, slug zitski said:

I was just speaking to a boatbuilder..big company..and asked about oyster.

I didn't know people still played 'second life'.

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22 hours ago, kent_island_sailor said:

If some 18th century novels are realistic, a Creditors' Liquidation involved large men at your house carting off all your shit.

... while you take up new residence in debtors' prison.

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17 hours ago, sailforbeer said:

Oyster is going "bust" so that they can reorganize to avoid the liability of the keel fiasco.  They will go through a suitable period of ominous press releases, scare their employees, depositors and suppliers to maintain the charade, and re-emerge with a "white knight", who will secretly be the same investment group that owns then now, with some lipstick and subterfuge. 

You heard it here first.

Well, maybe. Time will tell.

Personally, I would have thought that the liability exposure from the Polina Star III would be greatly outweighed by the substantial damage inflicted upon the brand by this liquidation/insolvency/bankruptcy/whatever it is.

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16 hours ago, TwoLegged said:

Haha, Mad.

But seriously, where they are now is offloading debt.

Demand for the product remains high.  The problem is a different height issue: Polina Star III's waterline ending up several hundred metres higher than her bootstripe

Excellent technical description.

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1 hour ago, Svanen said:

Well, maybe. Time will tell.

Personally, I would have thought that the liability exposure from the Polina Star III would be greatly outweighed by the substantial damage inflicted upon the brand by this liquidation/insolvency/bankruptcy/whatever it is.

Boatbuilders that aren't cranking out 100s per year would all be hard pressed to absorb something like that.

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Hmmm. Discovery already have a set of Discovery RS boats from 48-68’ and Southerly RS from 33-68’ plus two big wildcard Bluewater cats.

They seeking a canasta? (Guess the cats are the black treys?)

 

p.s. oyster’s webpage now on ice.

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Anyone in the industry know whether it’s more lucrative to make lots of little boats or fewer big ones? Quite a few lux brands like oyster only offer(ed) big and have ditched even midsize.. Like >50++ feet multimillion as their baby models?!

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45 minutes ago, HFC Hunter said:

Anyone in the industry know whether it’s more lucrative to make lots of little boats or fewer big ones? Quite a few lux brands like oyster only offer(ed) big and have ditched even midsize.. Like >50++ feet multimillion as their baby models?!

 

I'm no expert, but never heard of Feadship or Huisman having thesen sorts of problems?

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1 hour ago, kent_island_sailor said:
3 hours ago, Svanen said:

Personally, I would have thought that the liability exposure from the Polina Star III would be greatly outweighed by the substantial damage inflicted upon the brand by this liquidation/insolvency/bankruptcy/whatever it is.

Boatbuilders that aren't cranking out 100s per year would all be hard pressed to absorb something like that.

I was doodling some costs on the Polina Star debacle.

Used Oyster 825s are being marketed at £million–£5 million (e.g. currently asking £4million for Maegan, a 2015 model; the 2013-built Reina was asking £4.5million in 2017.  So a new one must be £6 million or more, and a new specially-extended 825 could be pushing £7 million.

Then there is the salvage costs from deep water, and the surveyors crawling all over everything.  That will be at least a few hundred thousand all-in.

Plus the owners will want some compo for loss of amenity, and the captain probably made his own claim too.

Then there's the two other 825s whose main saloons had to be gutted and rebuilt to allow the grid to be replaced, while their owners also wanted compo for loss of amenity, possibly including loss of charter income.

And everyone will have had several expensive lawyers on the case.  There could easily be £500K in that.

So a total bill of over ~£10 million is likely, and it could be a bit more.  I dunno how much Oyster's insurers would have paid up, but it's unlikely to have been anywhere near 100%.

While absorbing that loss, Oyster was also moving HQ and tooling up for the 118-footers.

So Oyster obviously needed a several million more capital.  But what I don't get is why this became critical now. Does anyone have any info on what the final trigger was?

 

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39 minutes ago, slug zitski said:

I suspect the creditors of Oyster did the numbers, and they didnt look good .

great insight there, Slug. Such a contrast with all the companies which folded because creditors thought the numbers did look good

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3 hours ago, kent_island_sailor said:

Boatbuilders that aren't cranking out 100s per year would all be hard pressed to absorb something like that.

Don't they carry liability insurance?

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27 minutes ago, SloopJonB said:

Don't they carry liability insurance?

I would think so. But their rate may have increased, and they possibly have to pay for outside inspectors or engineering reviews. As  badly as the keel structure on Polina was done, I doubt underwriters are going to give them a mulligan.

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12 minutes ago, RKoch said:
42 minutes ago, SloopJonB said:

Don't they carry liability insurance?

I would think so. But their rate may have increased, and they possibly have to pay for outside inspectors or engineering reviews. As  badly as the keel structure on Polina was done, I doubt underwriters are going to give them a mulligan.

Their rates have probably increased,  and they may have higher excesses and lower single-incident limits, as well as RKoch's point about tightened requirements for external monitoring.

Any payout on Polina Star will have been lawyered around whether there was recklessness, and negotiated downwards.  The insurers would have had a strong hand in the negotiations, since Oyster wouldn't want its deficiencies bared in court.

 

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1 hour ago, SloopJonB said:

Don't they carry liability insurance?

Loss might be excluded for defective workmanship or latent defect.  Also, the repairs to the other 2 hulls wouldn't be covered unless they bought some kind of product recall insurance.

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On 2/6/2018 at 6:10 AM, savoir said:

 

Only one model Oyster has ever had a keel fall off.

 

doesn't mater, just takes one big fuck up to tarnish a good reputation, and when you're talking in the realm of high end yachts reputation counts for a tremendous amount. bear in mind that for the ultra wealthy buying a yacht it's just as much a bragging piece as anything else.  

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41 minutes ago, frozenhawaiian said:

doesn't mater, just takes one big fuck up to tarnish a good reputation, and when you're talking in the realm of high end yachts reputation counts for a tremendous amount. bear in mind that for the ultra wealthy buying a yacht it's just as much a bragging piece as anything else.  

 

they had an order book bigger than it's ever been.., with long wait times..., so the problem with that boat doesn't appear to have actually caused them much of a problem selling boats

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More likely a back office finance fuckup, venture capitalists bet the company on bitcoin or something equally bizarre..

 

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Having worked at one of their contract builders back in the eighties, I feel qualified to suggest that QC was patchy at best. Of course, things may have improved since then. Or not.

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No need to speculate on what a lost keel cost Oyster, Leo posted links to the company's annual report a while back, here.  In 2015 they attributed a 5,88 mil GBP loss to the Polina Star incident and in 2016 a further 5.47 million GBP, for a total of 11.35 mil.  They called it "Unusual Administrative Costs". In 2016 they filed a suit against a contractor for 6.8 mil GBP but I don't know the outcome of that. 

It just goes to remind us, you fuck one goat...

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1 hour ago, us7070 said:

 

they had an order book bigger than it's ever been.., with long wait times..., so the problem with that boat doesn't appear to have actually caused them much of a problem selling boats

Back in the go-go '80's, I was told that rich Saudis and others, were buying Feadships, et aux, and immediatey selling them on for a fat profit, to punters, who didn't want to wait 2 years or so, for a new build.  At the time, I believe some of these sellers, had another subsequent boat order already in build.  Just curious if this was just a rumour, or was really going on?

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10 hours ago, HFC Hunter said:

Anyone in the industry know whether it’s more lucrative to make lots of little boats or fewer big ones? Quite a few lux brands like oyster only offer(ed) big and have ditched even midsize.. Like >50++ feet multimillion as their baby models?!

 

9 hours ago, billy backstay said:

 

I'm no expert, but never heard of Feadship or Huisman having thesen sorts of problems?

F or H haven’t made little boats since the 1950s and own their spot in the bigboat lux world. Oyster have been leaving their own turf to compete on new ground. Still curious whether 20x 40-50’ make more or less profit than 4x 70-80’ per year?

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1 hour ago, Ed Lada said:

No need to speculate on what a lost keel cost Oyster, Leo posted links to the company's annual report a while back, here.  In 2015 they attributed a 5,88 mil GBP loss to the Polina Star incident and in 2016 a further 5.47 million GBP, for a total of 11.35 mil.  They called it "Unusual Administrative Costs". In 2016 they filed a suit against a contractor for 6.8 mil GBP but I don't know the outcome of that. 

It just goes to remind us, you fuck one goat...

Two-legged's guess of 10M wasn't far off then. Neither figure includes possible increase in product liability ins or inspections. So there could be a few hundred thou additional costs that weren't planned for when they were taking orders and deposits. 

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3 minutes ago, RKoch said:

Two-legged's guess of 10M wasn't far off then. Neither figure includes possible increase in product liability ins or inspections. So there could be a few hundred thou additional costs that weren't planned for when they were taking orders and deposits. 

Taking a 12 million pound loss over 2 years can certainly put a crimp in the cash flow.  Given the outcome of the company I would guess they didn't win the lawsuit.

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Here's something that puzzles me about the Polina Star III saga.

AFAICS, that boat cost about £7 million new.  Even for an owner worth a few hundred million, that's a non-trivial price.  A no-sweat price, but still cash to take a wee bit of care of.

So wouldn't you want to take some care that the boat was built right, both to protect your investment and reduce the risk of your toy killing you?

I suppose you could rely on the certification inspectors, but wouldn't it make more sense to have your own independent expert overseeing the build?

Allocating 1% of total build cost to a naval architect/engineer/surveyor would give to a £70,000 budget, which would buy a few hundred hours of the time of someone v experienced. That should be enough for expert hands-on-monitoring of the key structural phases.

So do buyers at this level do that? 

Does anyone who knows this end of the business have any experience of how this is handled?

I know that buyers at that level tend to hire a qualified captain who oversees fitout, but do they also employ their own structural experts?

 

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I don't know. It would make sense. I suspect the builders wouldn't permit an outside inspector during the build...trade secrets and all that. I also think the owners at that level are probably very inexperienced boat owners, and simply rely on reputation and brand. That's what they're paying for, and why they're willing to pay top dollar. There's a lot of scammers in the marine industry looking for easy marks (dreamers)  loaded with cash. That's what got Paris in over his head with an unsuitable boat.

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13 minutes ago, TwoLegged said:

Here's something that puzzles me about the Polina Star III saga.

AFAICS, that boat cost about £7 million new.  Even for an owner worth a few hundred million, that's a non-trivial price.  A no-sweat price, but still cash to take a wee bit of care of.

So wouldn't you want to take some care that the boat was built right, both to protect your investment and reduce the risk of your toy killing you?

I suppose you could rely on the certification inspectors, but wouldn't it make more sense to have your own independent expert overseeing the build?

Allocating 1% of total build cost to a naval architect/engineer/surveyor would give to a £70,000 budget, which would buy a few hundred hours of the time of someone v experienced. That should be enough for expert hands-on-monitoring of the key structural phases.

So do buyers at this level do that? 

Does anyone who knows this end of the business have any experience of how this is handled?

I know that buyers at that level tend to hire a qualified captain who oversees fitout, but do they also employ their own structural experts?

 

Owners reps are very common for big/expensive yacht builds

I' spent a week at the Swan yard at Pietarsaari / Jakobstad  in Finland - they have a whole building devoted to office space for owners reps. If you build a boat.., you get an office for your rep.

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25 minutes ago, RKoch said:

I don't know. It would make sense. I suspect the builders wouldn't permit an outside inspector during the build...trade secrets and all that. I also think the owners at that level are probably very inexperienced boat owners, and simply rely on reputation and brand. That's what they're paying for, and why they're willing to pay top dollar. There's a lot of scammers in the marine industry looking for easy marks (dreamers)  loaded with cash. That's what got Paris in over his head with an unsuitable boat.

where do you get this stuff from...?

as i mentioned above - owners reps are _extremely_ common on big builds

also, as has been discussed, Oyster has amazing brand loyalty - second to none - most of the people buying big oysters are not "very inexperienced boat owners", but rather are on their 2nd or 3rd Oyster. And, they sail the hell out of these boats - what other builder sponsors a round-the-world rally for their boats? Oyster is on their second: http://www.oysterworldrally.com/#route 

 

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56 minutes ago, RKoch said:

I don't know. It would make sense. I suspect the builders wouldn't permit an outside inspector during the build...trade secrets and all that. I also think the owners at that level are probably very inexperienced boat owners, and simply rely on reputation and brand. That's what they're paying for, and why they're willing to pay top dollar. There's a lot of scammers in the marine industry looking for easy marks (dreamers)  loaded with cash. That's what got Paris in over his head with an unsuitable boat.

Oyster have been delivering the goods for too long to be scammers.

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3 hours ago, RKoch said:

I don't know. It would make sense. I suspect the builders wouldn't permit an outside inspector during the build...trade secrets and all that. I also think the owners at that level are probably very inexperienced boat owners, and simply rely on reputation and brand. That's what they're paying for, and why they're willing to pay top dollar. There's a lot of scammers in the marine industry looking for easy marks (dreamers)  loaded with cash. That's what got Paris in over his head with an unsuitable boat.

You can call in a qualified surveyor at any time.  Project manager or owners representitive do not rate as qualified.

A big boat will have a  owners project manager  plus  an owners rep.

..neither the project manger nor the owners rep will be on the shop floor.

In general   Employees are forbidden to speak with them about methods or progress. .  Trade secrets are real. Loose lips sink ships.  Any question or observations are addressed in the office upstairs. 

I dont know oyster , but suspect that oyster is full of sub contractors . Oyster doesnt " build the boat " 

Owners representitives and project managers help the owner integrate with the yacht builder ..language for instance, plus build documentation 

they also have power of attorney to sign off purchases, modifications to build order

when a boat is contracted  its specification is base...the finished project will be full spec. Huge amount of money in between..perhaps the profit for the whole build are these extras.

 The project manager makes a recomendation to the owner ...the modification gets signed off...the shipyard completes the task .  

The owners rep normally looks for practical solutions to operating and maintaining the boat.  Spare parts for instance.  You could have a spare autopilot in a box, or you could mount and wire the spare autopilot next to the primary autopillot , ready for use.  Millions of details like this 

 

 

 

 

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3 hours ago, us7070 said:

where do you get this stuff from...?

as i mentioned above - owners reps are _extremely_ common on big builds

also, as has been discussed, Oyster has amazing brand loyalty - second to none - most of the people buying big oysters are not "very inexperienced boat owners", but rather are on their 2nd or 3rd Oyster. And, they sail the hell out of these boats - what other builder sponsors a round-the-world rally for their boats? Oyster is on their second: http://www.oysterworldrally.com/#route 

 

Obviously the owner reps for the 4 825s didn't review the keel engineering drawings or monitor the construction. They must have been busy ensuring the wine cellar and hot tub operated at proper temps, and the marble was up to EU specs.

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2 hours ago, savoir said:

Oyster have been delivering the goods for too long to be scammers.

Pretty clear the new owners had cut structural integrity and were coasting on past reputation. I.E.: a scam. Owner thought he was buying an Oyster, got a Beneteau.

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7 minutes ago, RKoch said:

Obviously the owner reps for the 4 825s didn't review the keel engineering drawings or monitor the construction. They must have been busy ensuring the wine cellar and hot tub operated at proper temps, and the marble was up to EU specs.

They would not be qualified. 

Even if the layup schedule , engineering was correct they would have no way to judge the laminate without calling in a Pro.

my experience is that the shipyard takes full reponsibilty for engineering and building the hull and stuctures.

they own any defects .

its possible that an owners rep has observations .

these observations  would be put in writing then submitted to the yard office.

this is part of the build documentaion responsibilty of the owners rep, project manager

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10 hours ago, billy backstay said:

Back in the go-go '80's, I was told that rich Saudis and others, were buying Feadships, et aux, and immediatey selling them on for a fat profit, to punters, who didn't want to wait 2 years or so, for a new build.  At the time, I believe some of these sellers, had another subsequent boat order already in build.  Just curious if this was just a rumour, or was really going on?

Yes, this exactly what was going on. 

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9 hours ago, slug zitski said:

They would buy build reservations...then sell

even today this goes on 

very hard to get a build spot at a top yard 

 

Qantas did this with the Boeing 777, made millions out of selling their build spots, stupid decision should have got 777's and got rid of their 747's.  But they were betting that the 787 was going to be delivered on time  hahahahahaha

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Same thing was common in the condo market here a few years ago (maybe still is) - people buying condo's before the hole was even dug and flipping them for a big profit before they were even built. My wife had a client who practically made her living doing that.

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3 minutes ago, SloopJonB said:

Same thing was common in the condo market here a few years ago (maybe still is) - people buying condo's before the hole was even dug and flipping them for a big profit before they were even built. My wife had a client who practically made her living doing that.

There were people doing lots of that in Ireland in the Celtic Tiger years.  Then came the crash, and any of them got wiped out.

Serve them right, the useless parasites

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22 hours ago, us7070 said:

Owners reps are very common for big/expensive yacht builds

I' spent a week at the Swan yard at Pietarsaari / Jakobstad  in Finland - they have a whole building devoted to office space for owners reps. If you build a boat.., you get an office for your rep.

Not uncommon for a new boat to be surveyed prior to acceptance, same idea as for used ones - find any defects.

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Wouldn't want to rely on Discovery .... The 2 recent owners I know want to send their boats back, they are so pissed off with problems, defects, crap service, broken promises! Hey, but then again, shysters know where to find more suckers.

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On 2/6/2018 at 8:22 PM, slug zitski said:

Oyster had a niche in the Mid size boats  .   They are nothing special in the big range .

yards like Baltic  produce special boats and they have  loyal clients with deep pockets.

same with builders in the Netherlands.

Oyster was going after that market ...it didnt work 

 

Same thing for Baltic. Everything they went through to build and warranty Hetairus sent them under, they were lucky that one of their owners a) wanted a new boat from them, and b ) has a company that requires a lot of composite work. So he bought Baltic, and sent them a load of work to keep going between projects.

Very few big project yards are safe, that is why they have to have a full order book; otherwise they are sunk.

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10 minutes ago, Potter said:

Same thing for Baltic. Everything they went through to build and warranty Hetairus sent them under, they were lucky that one of their owners a) wanted a new boat from them, and b ) has a company that requires a lot of composite work. So he bought Baltic, and sent them a load of work to keep going between projects.

Very few big project yards are safe, that is why they have to have a full order book; otherwise they are sunk.

Yup...the Newest big swan seems to have a lot of ..."warranty work "

some of these warranty jobs are expected...clients go to the custom builder to build what hasent been built before.

difficult 

 

this is why the builders who stick with the platform method have better success.  

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