WASHINGTON – Area boat dealers are looking for a break after a tepid year of sales, but said a new rule that defers import duties on big boats will not give them the help they need.
The new U.S. Customs Service rule takes effect today, just days before the start of the annual Bay Bridge Boat Show on Kent Island. It defers duties for six months on foreign yachts, 80 feet or longer, that are brought to this country for boat shows.
The duty must be paid after six months or if the boat is sold. The dealer would not have to pay any duty if the boat is shipped back out of U.S. waters in six months without being sold.
But dealers say 80-foot yachts are rare in Annapolis, the self-described “Sailboat Capital of the World.” Big boats drift in from time to time, but bay buyers rarely ask for them and dealers rarely sell them.
“You use boats that big to cross oceans,” said Pat Mayben, president of Bristol Yacht Sales in Annapolis. Having a boat that size in the Chesapeake Bay, “won’t be utilizing it to its full potential.”
James Barthold said the new rule might not do much for this week’s show, but it could help a little bit with the larger powerboat show in the fall. Barthold manages the Bay Bridge Boat Show as well as Annapolis’ popular sailboat and powerboat shows in the fall.
“It might encourage more people to show off those kinds of boats at boat shows,” he said. “We usually get two or three (boats) that size in the fall.”
Yachts 80 feet or larger can cost millions. John Gordon, president of Admiral Yachts, has only sold one such boat in his life.
“It was a 105-foot wooden powerboat from 1929 that was filmed in two movies with Frank Sinatra,” he said. “But that’s nothing compared to the megayachts.”
Megayachts come as big as 200 feet and are packed with luxuries like precious woods, inlays, Jacuzzis and even helipads for helicopter landings.
“I’ve seen them in town a few times, but they don’t stay long because we don’t have dock space for boats that size,” Gordon said.
Most boats in the bay are under 40 feet long, according to the Marine Trades Association of Maryland.
But sales of all sizes of boats declined last year as the economy slipped into a recession.
“There were too many things on people’s plate last year with the economy and the stock market and talk of war with Iraq,” Gordon said. “Then the holidays came, and once the turkey hits the table nobody thinks of boats anymore.”
Boat sales across the country declined last year from 881,800 boats in 2001 to 845,300 in 2002. Sales of sailboats, which are especially popular in Annapolis, dropped from 20,100 nationwide in 2001 to 17,000 in 2002, according to the National Marine Manufacturers Association.
But after a slow year, Mayben thinks the market has turned the corner.
“We believe there’s some pent-up demand from people who didn’t buy last year,” he said. “The phones are ringing; people seem interested. We’re wildly optimistic.”
Others, like Barthold, are adopting the wait-and-see attitude.
“The boat market isn’t suffering, but it’s certainly not perking along like it did in the ’90s,” Barthold said. “I think at the end of this year, sales will be OK . . . I’d be surprised if it were record-breaking though.”