Minney’s Yacht Surplus store in Newport Beach is a staple in Orange County’s boating business.
The 50-year-old store sells navigation aids, knickknacks for boats and is one of the largest sellers of used sails.
Business is steady, said Jeff Wilcox, manager of the store, owned by Ernie Minney.
“We don’t go up or down much. It’s a steady course,” he said.
Orange County has the second largest number of boaters in California after Los Angeles. Serving those recreational and working boaters is an industry of marinas, supply stores such as Minney’s, repair businesses, boat dealers, charter boats, sellers of fish finders and navigational gear, even boatmakers, among others.
In 2007, there were 792,405 registered boats in California. That number doesn’t include personal watercraft, such as Jet Skis. California’s boating market is second to Florida’s.
Los Angeles County has the largest number of boat registrations in the state,89,377 in 2007,followed by OC at about 51,000, which was up some 8% from 2006.
Since 2000, the year of the most local registrations was 2001 at 55,786, likely fueled by the technology boom and strong economy. The worst year was 2002,after the tech crash and amid a recession,with 43,745 registrations.
The county’s three harbors,Newport, Sunset-Huntington and Dana Point,moor about 17,500 of OC’s registered boats, according to the county.
The rest of the boats mostly are parked on trailers on land.
Marinas
Newport Harbor is the largest with about 9,000 boats. There are 6,000 in Sunset-Huntington and 2,500 in Dana Point. It costs $8 to $50 per square foot per month for a boat slip in OC’s harbors with Newport at the high end.
All the harbors have waiting lists.
The boating industry employs a host of entrepreneurs, boat captains, money lenders and repair people.
Some of the jobs in the boating business, estimated to be nearly 300,000 in the state and possibly around 25,000 in OC, are lucrative. A yacht salesperson can make upward of $100,000 on a boat sale with 10% commission.
Many jobs offer lower salaries. A captain, who’s responsible for boat operations and maintenance, makes roughly 1% of the cost of the boat. Some can earn more.
During last week’s Newport Boat Show at Lido Marina Village, captains were polishing the rails of their boats. Others on the low end of the pay scale were scrubbing the decks.
John Doughty, owner of one of the oldest tackle shops in OC, JD’s Big Game Tackle on Balboa Island, sells $60 big-fish lures. They are giant multicolored caricatures of the smaller fly-fishing lures. He also sells a $5,000 pair of binoculars that can read one-inch lettering from a mile away.
He makes most of his money selling fishing packages,outfitting boats with rods and reels and other fishing gear for $5,000 to $20,000.
Doughty, who was showing his lures at the boat show last week, said he ekes out a living. Fishing as a sport has declined, he said. Many people have become aware of the environmental problems with fishing, he said.
There’s an enthusiastic niche of sportsfishers in OC, according to Doughty. They compete in tournaments.
Flip through Fish Rap, a local fishing publication, and you’ll see photos of smiling men holding fish as large as themselves.
Crow’s Nest Yachts, which sells yachts in Newport Beach, has its own fishing team that competes on the national circuit.
Sport fishers are one of boating’s cliques, Doughty said. There also are the cruisers and the sailboat racers.
Boat Show
Bringing the industry together is the annual Newport Boat Show, known as the oldest, now in its 35th year. It’s the largest show held on the water on the West Coast. It was expected to draw about 15,000 people last week.
Exhibitors included businesses such as Doughty’s, Alcom Marine Electronics, based in Costa Mesa, Dana Point Marina Co., Sun Country Marine of Dana Point and McClintock Yacht & Ship Brokerage in Newport Beach.
Put on by Duncan McIntosh, publisher of the Fish Rap, the boat show had $450 million worth of boats this year and about 330 exhibitors, up from 300 last year.
Boats on display were 35-feet long and longer and cost as much as $7 million. The boats came from Mexico and all over the country.
“This is the biggest show for big boats,” McIntosh said.
About 60% of the boats shown were new. Forty percent were being shown by private owners or dealers.
McIntosh’s Duncan McIntosh Co., based in Irvine, also puts on the Lido Yacht Expo in Newport Beach in September. McIntosh charges boat sellers $32 per foot to be in the show.
Tough Sales
Kurt McClintock, a Newport Beach broker, had a few boats displayed at last week’s show, including a 36-foot boat for $299,000 and a 48-foot one for $569,000.
If it was anything like a Florida show he recently attended, he won’t be selling any of the boats.
“It was terrible out there,” McClintock said.
Most of the boats he sells are in the half a million to a million dollar range. Closing a deal on a boat takes a couple of days, if the customer is paying in cash, or three weeks if they’re getting financed, he said. With financing, there are insurance inspections that need to be made.
The industry slowed last year, he said.
“On the weekend I was driving limos at night,” McClintock said.
He even went back to doing some repair work, which is how he got into sales.
But this year seems to have picked up, he said. He’s sold six boats so far. He’s also been selling more repossessed boats.
Even boats have a repo man. There are two who serve OC, National Liquidators, based in Ft. Lauderdale, Fla., with an office in Newport Beach, and Long Beach Yacht Sales.
One of his repossession listings is a 38-foot Hunter Sloop, reduced by $20,000, it says, to $92,000.
McClintock doesn’t make as much commission selling repos. He generally earns 10% commission on sales but splits that with the repossession company.
Even though boat sales slowed last year, boat prices haven’t declined, said Bob Brown, spokesman for the Southern California Marine Association based in Orange.
The raw materials to make the boats,petrochemicals and stainless steel,have gone up in price, he said.
More people are looking at financing.
“Financing rates on the boats are extremely good,” he said.
The catch is that buyers now need to have excellent credit to qualify.
The boats that sell well in this economy, where gas prices are high, are sailboats. It can cost $500 in gas for a trip to Catalina in a powerboat.
Boat Maker
Roger MacGregor, owner of MacGregor Yacht Corp., makes large sailboats in Costa Mesa and said he’s been able to boost his profit without growing. The boats sell for about $21,000. MacGregor does about $8 million in yearly sales.
MacGregor makes about 600 boats a year on Placentia Avenue, where he’s surrounded by repair, maintenance and supply businesses, such as Moonlite Marine, which sells hatch latches and rail cleats.
Some local boat supply businesses sell internationally, MacGregor said.
The boating hub shares the neighborhood with apparel companies, such as Paul Frank Industries Inc., Volcom Inc., Atwater Clothing and Nike Inc.’s Hurley.
MacGregor’s boat making business is a rarity in OC. Most boats today are being made in China, Taiwan and elsewhere overseas.
Costa Mesa was a thriving boat making hub in the 1970s and 1980s, he said. But large corporations such as Coleman Co. came in and snapped up OC’s boating businesses.
They couldn’t figure out how to run them, he said.
“It’s a hobbyist industry,” MacGregor said.
Most of the boat companies went out of business, he said. Air quality regulations scared away the rest.
MacGregor, who founded his business in the 1960s, has been willing to deal with air quality rules and other environmental regulations.
“They really have cleaned up the air down here,” he said.
His business also got a boost when its workers’ compensation insurance premiums decreased significantly after reforms a few years ago.
MacGregor says he’s been able to do well by selling one model, the MacGregor 26, a 26-foot sailboat. He said he’s also stayed out of debt.
“Last year was the best year yet,” he said.
