Jupiter Sunsation

I think Skip was thinking forget the smaller boats, let the customer up their budget. The margins likely still aren't there for smaller boats and the current owners really want ballers only, nothing cheap/entry level.

The 29 OL is a sleek boat, I love BobtheBuilders new one and the twin OB one, both are homeruns! A 30 vice with twins would be a nice setup.

TeamSaris

not to take this off the topic of Cig....
But beyond the 27 (which is more than a 1 off, we've talked to Gio quite a lot about one) Magnum just recently unvailed the new 47 in Europe with 450Rs hanging off it.


Carry on!

jtr2kwl

Look, I have to say that I honestly respected the amount of ambition that the new ownership came in with. Now, some of their ideas were good, some were bad, and some made no sense - but they had the ambition. I love that they want to grow the cigarette brand (ok - lets ignore the sweatpants for now). But ultimately, I don't think it was the "bad ideas" that have gotten cigarette into the position that it is in right now, rather I think that they overlooked 2 key factors. This isn't a "what they should have done" post, just an analysis of where I think the missteps were.

1) Cigarette failed to secure its core products & customers
2) Cigarette failed to recognize that its brand equity is almost 100% based on its reputation ( and credibility)

A little more on those:

1) Coming into an acquisition like Cigarette and wanting to growth the brand is great and all, except Cigarette seems to have failed to build on the foundation of their core offering. I would think a more appropriate growth strategy would have looked like:
1) Secure existing core product line
2) Secure existing customer base
3) Expand products within existing segment
4) Enter new product segments (DW Cat)
5) Enter new product markets (jet ski)

IMO, cigarette skipped steps 1-3, and went directly into growth mode without focusing on its core product offering and customers, and looked to enter new segments(DW cat) and new markets (jet ski). I thought the DW acquisition was a very astute move, and its really too bad the deal fell through. When this deal fell through, I think they really doubled down on the jet ski, which is a bit worrisome to me. The jet ski market is pretty saturated, highly competitive, and I imagine low margin. Considering the amount of CapEx to develop in-house (per the original plan), price point, and comparatively low volume production - they payback period would have been what, like 1,000 years? I think cigarette recognized this, and probably sought out a partnership or licensing agreement - hence the Miami boat show jet ski. And I think this jet ski ambition has really backed them into a corner. JR may be a billionaire - but just how much money is he willing to sink into a jet ski that he'll probably lose his shirt on?

2) I think the new ownership team failed to recognize that Cigarette's brand is primarily built on its reputation. At the end of the day, its products are NOT differentiated. The "luxury performance CC" market is extremely saturated, they're practically a commodity at this point! The same is true to an extent with the V bottoms. Pretty sure I can go pickup a 52 foot OL for half what Cig is asking for a 515. I think they overestimated Cigarette's competitive advantage, and the brand has suffered.

I think that may have driven the revenue growth claims (3x, 4x at one point, now claiming 50%+). as a proxy to give the impression that the brand is doing well. But who cares about revenue? It's a private company, and I've never heard another custom manufacture make claims about revenue growth. Who knows what revenue growth actually is, its completely unverifiable, and they can say whatever they want! But the fact of the matter is revenue growth doesn't get "fans" excited - pumping out cool boats, and we haven't seen any of that. Pre-acquisition cigarette was building something like 20 boats a year. At 1.5x. 3x. and 4x that would imply 30, 60, or 80 boats a year - and I think I've seen maybe 4 in the last year? Unfortunately, the false claims only further tarnish their reputation.

Anyway, I'm actually rooting for them. I hope they can get this thing back on track. Cigarette IS a great brand, and I think Cigarette can come back - but they may have to rethink their strategy and start again at square 1.

Jupiter Sunsation

340K is insanity for a 29 Velocity........to me that should be 1/2 that price.

jtr2kwl

I don't disagree with you - but still think it would have been a very interesting trajectory!

techman

How about those Donzi 22 Classic's going for 200k?

Crazy....

Knot 4 Me

Saw a single 400 27' Crest tri-toon the other day with a list over $200K. Nucking Futz.

Jupiter Sunsation

Good to know!

If Magnum keeps up the new builds they might make more boats than CRT!

Interceptor

When I mentioned Magnum or Riva crowd it was related to the wealth they have and the ability to buy a Cigarette.

Slippery

That was exactly our experience a few years ago....My wife and I were at the Miami show and we we couldn't get the time of day from them...they were more interested in talking to each other than anyone looking at the boats...It was pre-pandemic, and I'm sure they were enjoying very strong sales at the time, but I'd been a Cig fan since forever and that cured me.

Everyone else we talked to seemed like they were happy to see us, but it was apparent customers were an interruption at the Cig booth.

We did buy a boat....just not a Cig.

d