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The US dollar has continued its downward slide. Presently mid we can only say for certain that whatever happens next "will be interesting. Due to the variations in exchange rates since early when this article was written, an adjustment to the relative costs from one country to another must be made when using the following approach to cost estimating. In other words, a substantial adjustment in the absolute per pound cost of boat building discussed below must be made.

The global economic map continues to change, making certain countries better candidates for effecting labor cost savings at different times. Therefore, please consider the following essay to be an outline of how the venue where built can have a dramatic impact on the cost of boat building - and an illustration of how quickly that landscape can change. If we make use of New Zealand as our example foreign venue, it is interesting to observe that nominal labor rates in New Zealand are approximately the same as they are in the US.

Based on the exchange rate as of the time of the writing of this article, each "New Zealand Dollar" being paid to a New Zealand yard will cost a US client around 40 US cents.

Given that the number of hours will be roughly the same for a specific vessel, regardless of where built, a yacht built in New Zealand will be considerably less costly than one built in the US. At this point we may begin to understand the rationale for pursuing construction in a country like New Zealand. For a US clientele, provided that the value of the US dollar remains stable, New Zealand becomes quite a viable place to build a yacht.

Using the yard's "hourly rate" as a gauge, and adjusting for the applicable currency exchange rate, we can work this same equation for building in Australia or Canada. Given a fixed level of finish, complexity and outfit, the cost of a vessel will usually vary according to the vessel's cubic contents. At the beginning of the design process, in order to make use of a readily available parameter that also varies as the cube of the overall dimensions, I ordinarily use the Design Waterline Displacement.

Although not always the case, a vessel's displacement will usually provide a convenient variable that roughly parallels the cubic contents of the whole boat. If it is less, I will use the light load case weight. In other words, I do not include any tank contents or other consumables, nor any owner supplied outfit items, i. Presuming we are comparing like to like , we may then infer that the cost of a vessel will approximately vary directly with the displacement.

This preliminary "cost per pound" presumes that the vessel will be built in the US ; that it is reasonably simple in terms of equipment and outfit; that the interior is elegant but not fancy; and that the structural components will be NC cut. For most small craft, I refer to this level of finish as being done to a "high end commercial standard" both on the interior and exterior.

This assumes that the interior finish will be done simply but nicely using North American hardwood face frames and trim with otherwise painted surfaces, and that the systems will not be overly complex, i. If the vessel is to be of aluminum, then this cost per pound implies that the exterior will not be painted except where necessary, therefore approximately equaling the cost of a painted all steel vessel.

Each one of those cost-adjusting factors can have a significant impact. Collectively, their impact can be dramatic. One can indeed embellish a vessel to the point of unaffordability, whether it is a production boat or a custom design. These cost variations illustrate why we tend to prefer simple, rugged, reliable boats. They are much more affordable, and in the long run easier to care for.

Once the preliminary baseline cost is adjusted for various owner induced factors, an approximate cost per pound is applied as though the vessel is to be built in the US. Once the appropriate general assumption has been made with regard to cost per pound, and assuming that we are making a comparison to a similarly specified vessel.

I will then make the following assumptions:. One can assume approximately that materials will cost the same regardless of where purchased, once the monetary translation has been made. For example when approximating construction costs in another country I do not assume there will be any materials or equipment cost advantage, regardless of where the equipment or materials get purchased.

As we have noted the nominal shop rates in New Zealand in are approximately the same as they are in the US. Naturally, there are costs involved to build in New Zealand, such as travel, shipping, and import duties. Of course there are adjustment factors to throw at the equation at every step, such as for what percentage is assumed to be expended on labor.

Conversely, with a higher finish and a more complex i. Variations in the exchange rate will obviously affect the above percentages, possibly dramatically. This is a small "trawler yacht" type in terms of the level of finish, and has a steel hull and deck with an aluminum house structure. To a large extent this vessel follows the level of finish described above for our "basic example vessel.

On this small Tug Yacht, per client request there were two price increasing Steel Boat Designers University factors: 1 A hydraulic system for winches and thruster. Another price increasing factor was that the hull is steel and therefore requires a very thorough and complete paint system inside and out, and that the house is alloy, requiring a relatively expensive bi-metal transition bar between.

A more detailed look at costs for this vessel are as follows: The vessel has a DWL displacement of around 30k pounds. In general, the designs we create tend toward an economically achieved "simple but elegant" yacht finish, or what we call a " high end commercial " finish. The prices quoted are roughly applicable at the time his article was written April Variables such as inflation, interest rates, and currency exchange rates will naturally have their effect over time.

The above method is intended to provide a quickly achieved "target" cost, and is based on a given "typical" type of example vessel. It is of course a very rough approach and will require that corrections be applied depending on variations in the type of vessel. The actual prices quoted by yards will often vary considerably from the above approximate guide, depending on the yard's accustomed "quality level," their overhead costs, their market, their typical customer types, and on how busy they may happen to be when the construction cost estimate is solicited.

Among other considerations, one must look at whether the boat is relatively heavy or relatively light for her overall size. We should throw in a correction factor for a vessel's displacement to length ratio , since a lighter vessel will invariable cost more "per pound" than a heavier vessel on which there will be more pounds to spread the cost.

In spite of the possible shortcomings of this method, as a base-line estimating tool and as a means to provide a quick comparison between boat types and between differing locations for construction, we have found the price per pound approach to be highly useful. I have spoken with experienced project managers here in the US who use completely different "off the cuff" ways to create a quick "ballpark" estimate for a prospective project.

Even though these yards may use entirely different methods, their estimates do seem to come out more or less in the same range, once adjustments are made for complexities, relative displacement, etc. Overall, it must be kept in mind that this approach is based on comparing " like for like " since one vessel type can vary substantially from another vessel type. For our example, we have used a typical small "trawler" type that has a "high end commercial finish" throughout.

A different type such as a fast motor yacht will have fewer 'pounds' with which to divide the costs, will tend toward a much higher finish, will have a more elaborate 'style' and will often have a much higher specification - in particular with regard to propulsion machinery and other support systems. By "one-off construction," I am assuming that the boat is to be unique, including the vessel's design, and that only one vessel will be built to that design.

In other words, I am inquiring whether a client can consider custom design and custom building as a viable and cost competitive option when planning a new yacht. A comparison published during in Ocean Navigator magazine showed a number of fiberglass production "Trawler Yachts" built in the US and elsewhere.

It must be kept in mind that these quoted prices for production boats ordinarily do not include outfitting and in many cases do not even include electronics or other systems beyond just the basics. However, these production boat prices ordinarily do include a fair sized margin for middle management, for promotional events, for advertising, and for brokerage overhead.

One-off fiberglass construction requires that new hull mold tooling be created. This has the obvious disadvantage of adding overhead to the project both for materials and for labor.

One highly promising technology that has the potential to benefit the labor side of the equation for one-off fiberglass boats is to make use of computer modeling, with the resulting ability to employ NC cutting to create the hull mold. Janicki uses a 5 axis NC router mounted on a large overhead carriage to carve out hull and superstructure molds. At this shop, their maximum machine size is 88' x 20' x 8'. If the project is larger, the mold is segmented with parts that are keyed together.

If the designer has not supplied a computer model of the hull, Janicki creates a computer model in-house from which to create the mold. Janicki's shop is set up to carve out a foam-block mold using a large 5 axis NC router.

Their strategy is to stack up "lifts" using relatively light foam. The high density foam is machined to the final tolerance, and the result sprayed with a fairing material, usually a high build paint that is applied to a relatively heavy thickness for sanding. The mold is then shipped to the builder for assembly and final sanding.

The costs for the NC mold making process by this method are slowly becoming competitive with manually done mold work. Currently, for intricate superstructures, there seems to be a cost advantage favoring the NC cut method. At the other end of the spectrum, for simple chine hull forms it seems to be less costly to build a disposable mold manually. This approximate parity of manual versus NC methods for mold making is due both to the increased materials costs for the foam mold, and for the high cost of "machine time" on the large NC router.

For the time being, the primary advantages offered by this type of NC mold making system are the dimensional accuracy of the mold, and that the lead-in time for mold construction can be removed from a boat builder's schedule.

Another advantage offered to the boat builder is that lofting may be completely eliminated, which translates into a savings of labor and shop space for the builder, ultimately reducing shop overhead. On the basis of cost, in spite of the advantages of NC cutting, the above factors have made one-off fiberglass boat building relatively un-competitive with a production environment. As a result, the one-off fiberglass yacht market is currently focused on vessels above 80 to feet where production boats are relatively less common, and where owners often want a 'signature' vessel with, say, a unique styling to the superstructure.

Among boats built in the US, one-off metal construction costs can compete very well with production fiberglass costs. The trade-offs are approximately as follows. Considering just the production costs themselves, while there is considerably more labor involved in the fabrication of a metal hull and superstructure than there is in the laminating of a GRP vessel, to offset the added cost for labor, the cost of materials for a steel hull is quite a lot less than with for GRP hull.

Even if the metal hull is aluminum, material cost will still be less than for fiberglass. With higher labor costs for metal, and higher materials costs for fiberglass, we may for the moment assume the costs of metal and fiberglass to be approximately at parity. Obviously, there are no mold costs with metal construction as are required for fiberglass, and there is no mold to take up shop space during or after construction, therefore lesser overhead.

This gives a slight edge to metal construction. Taking metal construction technique one step further in terms of efficiency, if hull and superstructure are pre-cut NC driven tools plasma torch or water-jet the labor saved can be substantial, and metal construction will generally win the cost comparison. Let's take a brief look at what kind of savings are possible for metal boats via NC cutting.

With NC cutting, the number of hours added to the design tasks in order to create the structural detailing for a computer-cut hull is not so great, particularly if the design work has already made use of computer modeling to create the hull geometry. Even if the hull model must be created just for sake of the NC cutting operation, the cost expended to create the model and the NC cutting files will be compensated for several times over by the labor saved while building the boat.

Estimates of the metal fabrication time saved via NC cutting for one-off construction will typically range from 40 to 60 percent of the hull building labor, depending on the builder, and on the degree to which the boat is pre-cut.

We can look at a generic example here, using the same 38' tug yacht design. If the vessel's structure were all manually cut, we can approximately assume that it will take roughly 2, hours for the hull and deck metal fabrication, including final weld-up. This saving of hours times the shop rate being considered provides an example of the possible savings. Our estimate of the time required to generate NC cutting files for this fairly "typical" 38 foot metal tug-yacht example is between and hours.

The cut files for such a project usually include all internal structure for the hull, deck and house structures, except for extrusions such as longitudinals or pipe guards, etc. In other words, all frames, girders, tank ends, tank faces, large cut-outs, tank lids, etc. The NC cutting files also include all hull and superstructure plating as well as the rudder internals and plating.

Small parts such as cleats and hatches are not detailed for NC cutting, however chain plates, anchor roller cheeks, and reinforcement insert plates are included. In order to permit ease of bending-in the shell plating, there are generally no cutouts made for portlights, windows or doors, even though marking lines for those openings are provided.

Marking lines are also provided for grid elements, and all parts and grid elements are labeled for ease of assembly.

In exchange for the relatively small amount of time expended at the computer to create the cut files, we can see that the cost trade-offs heavily favor NC cutting. We assume of course that the hull geometry will have been accurately developed, that the NC cut files are carefully and accurately prepared, and that the cutting is done to a close tolerance. One of my designs built in New Zealand was the all aluminum 25' tug-yacht Boojum.

Done as a proof-of-concept in terms of being able to repay the cost of developing the NC cut files, the Boojum project has accurately confirmed the above assumptions. Since then, we've done a number of other NC cut projects that have re-confirmed our original estimates of the fabrication labor saved. For a good overview of the process of developing NC cutting files, please see our Design Stream article and other articles linked from there.

A newly competitive method of cutting aluminum has begun to gain popularity: water jet cutting. In most shops in the Pacific Northwest the cost of water jet cutting is estimated on par with or slightly greater than the cost per pound of plasma cutting aluminum. Therefore there can be cost advantages to plasma cutting, versus quality of cut advantages to water jet cutting. It is assumed that all other structure will be NC cut. For new construction of commercial vessels in the US, it is nearly unthinkable to consider manually cutting the structure for a new boat.

However, there has been very slow acceptance of NC cutting for yacht building in the US. In other words, here in the US, where we imagine ourselves to be at the leading edge of technology, we are currently quite behind the times in the yacht building industry. In my view, this is mainly a matter of unfamiliarity with NC cutting among yacht builders. Many yacht builders are simply not willing to admit that a computer can be a real boatbuilding tool.

It is interesting to observe that in New Zealand, Australia, and throughout the EU, this situation is just the opposite. Builders in those locations now expect that a metal boat will be NC cut, even if it is a one-off yacht. In the final analysis given the excellent software tools available there is just not a more practical means to build a vessel, whether small or large, regardless of the material of construction. Since this kind of software has become increasingly affordable to smaller design offices, the general acceptance of computer modeling and computer cutting is on the rise.

We can expect to see the computer cutting process employed for yacht construction more and more often in the coming years even for one-off boat projects. Compared to a production environment, one-off construction implies that the cost of the design work itself will be added to the project.

We must then ask, " Can one-off design be competitive in terms of cost? In order to answer this, we have to ask, " What does custom yacht design actually cost? Smaller vessels say below 40 feet will usually tend toward a somewhat higher percentage for design work, there being a certain minimum number of hours required to design even small vessels. Other factors affecting the cost of design are variables such as changes, tank testing or other special requests.

For a thorough discussion of the cost of one-off design, please see our separate web article on Yacht Design Costs. Regardless of the material chosen for hull construction, if the designer has been the source of the client, then there are considerable savings to the client in terms of there being no promotional costs or brokerage fees.

Whether using a large NC router to create tooling for a one-off fiberglass boat, or using NC plasma cutting for a custom built metal vessel, it should go without saying that if the designer has created the hull geometry within a NURBS based computer modeling environment, the labor already expended in the design office to create the hull model can then be leveraged and put directly into the production environment. Both designers and builders can use NURBS surface modeling in combination with other construction oriented CAD tools to effect a substantial labor savings and therefore a cost savings to the builder, and those savings will be to the benefit of the client.

In the case of NC metal cutting, the labor savings are enough to pay for the cost of generating the cutting files some 2 to 3 times over. There are other often overlooked ways a boat owner can save build costs and still have a first class vessel.

For a thorough discussion of those strategies, please see our web article on Affordable Boatbuilding. What special considerations are designers faced with when developing a new design for offshore construction?

For US designers and possibly for a large portion of Canadian designers, there will be the issue of differing measurement systems. It is more or less the case in North America that all construction trades still use the Imperial measurement system, whereas in most other countries of the world the Metric system is in use.

As an example, in the US and Canada, whether you are purchasing plywood for fiberglass mold construction or for interior joinery, it will most often be supplied in feet and inch dimensions.

The same is the case when specifying metal structure: The metal components will virtually always be supplied in Imperial sizes. This situation means that a designer must know the construction venue as early on as possible in the design process. For example, with metal construction, the difference between Imperial plate thicknesses and Metric plate thicknesses can have a dramatic effect on the overall weight of the structure. In addition, the designer must make frame size and spacing allowances in order to create a structure of equal strength, using materials which will be locally available to the builder of choice.

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