Buyer's Guide

March 31, 2014

Importing a boat in Canada in 2014, still a good thing?

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Are you considering buying a 24 to 42 foot boat, and wondering whether bringing one up in Canada from the United States could save you money? With recent changes in the market, what are the advantages of importing a boat from the U.S. in 2014?

It wasn’t so long ago—between the fall of 2008 and the summer of 2012—that there were a lot of appealing deals on pleasure boats in the United States. At the time, market conditions were closely linked to the economic crisis that plagued our neighbours to the south (leading to a glut of used boats for sale) and to the buoyant loonie, which was at near parity with the American dollar.

What is considered a good deal in the import market?
In order for your import boat to be considered a real deal, it has to cost significantly less than the same model sold by a dealer in your area. Sure, the definition of a "deal" may seem subjective, but when you consider the risks of buying a used boat without any possibility of recourse or any guarantees, the cost price really needs to be 25% to 40% lower than a similar boat from the same manufacturer (and obviously featuring the equivalent equipment for Canada).

Cost price
To better understand what we mean by "cost price," remember that the total cost for imported used boats includes: the amount you agree to pay the seller, the cost of the boat survey (to check the motors), the cost of having the licenses and registration papers verified (when applicable), loading costs and shipping to Canada. If the boat needs repairs, you’ll have to factor that in too.

Thanks to the North American Free Trade Agreement, you don’t have to pay any duty, unless the boat was built outside of Mexico, the U.S. or Canada. However, when the vessel crosses into Canada, you do have to pay the sales taxes (GST and PST) on the amount you paid for the boat in Canadian dollars.

New ballgame for 2014
As the new year dawned, the market conditions for imported boats changed dramatically compared to the 2008-2012 period. The primary factors for this change were: fewer used boats up for sale, the decreased value of the Canadian dollar, and a general increase in the asking price of used boats.

Fewer used boats
In its 2013 report, the National Marine Manufacturer Association noted that since 2007, sales of boats with I/O motors has been in progressive decline.  According to their stats, sales of pleasure boats with I/O motors dropped by 20% annually from 2008 to 2012. During this time, some manufacturers went out of business while others were forced to temporarily reduce production, with certain models being put on hold altogether.

Fast-forward to 2014, and it’s not surprising that there aren’t many used boats for sale that were made in 2008, 2009, 2010 or 2011, as few units were actually built during those years.

So if you’re a deal-seeker looking for a performance boat or one of those models that wasn’t produced in recent years, you’re going to have to settle for an older model. You might have to go back as far as 2004 to find one of these increasingly rare pearls.

High exchange rate 
"The Canadian dollar reached parity with the U.S. dollar at the beginning of last year, but its value tumbled throughout 2013 to finish at $0.94 by the close of last year." This claim says a lot about the decline of the loonie. In January 2014, our dollar dipped as low as $0.90. Of all the factors affecting the cost price of buying a boat abroad, the exchange rate alone increases the price of buying a boat in the United States by 14%.

More expensive used boats
The fact that there are fewer used boats for sale has definitely caused prices to go up. It’s a simple question of supply and demand.  Compounding the situation is the fact that the American economy has been slowly getting back on its feet since summer 2013. Plus, the price of new boats is also up.

Each used boat is unique and it’s hard to find another just like it—with the same engines, options and equipment. Plus, you also have to consider how many hours it has spent on the water and its general condition. The value is subjective and these days it’s a seller’s market.

Conclusion
2014 marks a turn in the American used boat market. There are fewer deals and super savings to be had, as vessels are selling at higher prices, which are higher still when converted into Canadian dollars. So before you take the plunge and buy a boat from the United States, do your research and cost out the total price—then compare it with the cost of buying something in your own back yard.