Why are US Lagoon Agents giving quotes in $US's and not the Euro?

[GoingWalkabout]

I asked for the latest price list for a Lagoon 560S2 and was given the sales price list including optional add ons. One thing I am having a hard time reconciling is with the fall of the Euro are they passing on the lower Euro cost to the US buyers or is Lagoon and the selling brokers collecting the difference? Are they making new price sheets every week or have they fixed the price for US buyers for the year and have taken our foreign exchange hedge contracts to cover any price movement?

By my calculations we should be seeing a greater reduction in the new sales price than what is being offered to US buyers for new. And of course a lower new price would directly impact the re-sale market. But this is not happening. Which makes me think that the French builders are doing what they can to fix the prices so as not to affect adversely the pre owned market. Market fixing in its purest form.

Perhaps they are trying to stabilize the market through price fixing in order to insulate the re-sale market from being slaughtered and reaping extra margins for the builder and agents. I am sure there are a lot of charter companies with a lot of money tied up in their fleets that are concerned with a sharp drop in their floating assets. And they more than anyone would be putting a lot of pressure on the manufacturers to fix the price of new so that a their not hit with a huge loss on the aging investments.

[valhalla360]

Highly doubt there is a conspiracy. They aren't going to slaughter their new boat sales to prop up used boats they won't be making any money off of (charter companies are smart enough not to buy the boats themselves so they really don't care)

Most likely just not recalculating the prices every day. If you go in to bargain, they will account for it.

[onestepcsy37]

Make a lower offer.

[monte]

Just ask for a price list from a European broker and you can compare.

[Greenhand]

Price fixing involves cooperation with competitors, so what you are describing is not price fixing at all.

[wooden head]

Do you pay full list price for a new car too? List is just where the bartering starts.why would you drop the list price every time the market hiccups? A specific dealer use it as a sales gimmick. Others may have already laid out capital into inventory that is not helped by the devalue of the euro. And of course where possible they want to keep resale prices high to help pitch the "investment" value. (Yes I know a pleasure boat is generally not an investment, but we've all heard the pitch.)

[GoingWalkabout]

Originally Posted by monte

Just ask for a price list from a European broker and you can compare.

Great idea Monte. Thanks

[GoingWalkabout]

Originally Posted by valhalla360

Highly doubt there is a conspiracy. They aren't going to slaughter their new boat sales to prop up used boats they won't be making any money off of (charter companies are smart enough not to buy the boats themselves so they really don't care)

Most likely just not recalculating the prices every day. If you go in to bargain, they will account for it.

I appreciate your logic but I respectfully think you are overlooking the fact that the largest buyers are the charter operators who can exert a lot of pressure on the boat manufacturer. Ask a manufacturer who sells to a company buyer like Walmart. Manufacturers in a lot of industries end up having the tail wagging the dog because they become dependent on the customer and will do everything to keep the customer happy.

Regarding the charter companies being smart enough not to buy the boats themselves that is very true. However they have also a motivation to keep their customers happy. A collapse in values would cause havoc to the business model they sold the boats on. Many, many very disgruntled charter owners is bad for business, period. IMHO.

[onestepcsy37]

As a USA based importer of European yachts they are quoting the price in dollars, not euros, because they expect to get paid in dollars, not euros. Same reason Walmart quotes their price in dollars for items imported from China, not in yen.

[owenrms]

There is a euro price list on the web.
http://www.kiriacoulis.com/sales/Lag...management.pdf

[sailingforfun]

Montes spot on. Obtain a Euro price list and a Dollar price list from a Lagoon dealer. Do the math to compute the implied FX rate. If the implied FX rate is not close to the current market rate then you now have something to negotiate about.

[Sand crab]

Originally Posted by onestepcsy37

Same reason Walmart quotes their price in dollars for items imported from China, not in yen.

We have a booboo there.

[Saleen411]

Originally Posted by Sand crab

We have a booboo there.

Hmmm, yuan-a tell us what it is?

[barnakiel]

Quoted prices are not related to spot FX market. They are related to future prices (future contracts on EUR).

Implied volatility will be less than historical volatility. Smoothing effect of future contract pricing formulas.

Similar to no gusts visible in grib wind data.

b.

[EzzyD]

Originally Posted by onestepcsy37

As a USA based importer of European yachts they are quoting the price in dollars, not euros, because they expect to get paid in dollars, not euros. Same reason Walmart quotes their price in dollars for items imported from China, not in yen.

But of course not... Japan did NOT conquer China, and thus the yen is not the currency used in China....

China tends to use $, or Chinese Yuan Renminbi.