Charter costs explained

Champagne on ice
The more lavish your requests, the higher the cost of "extras" may become | © Jeff Brown / Superyacht Media
When looking at which yacht to charter, price could play a key factor. Make sure you know what you will need to pay on top of the base price.
The best analogy for determining the cost of your charter is with buying a car. It’s never quite as easy as just walking into a showroom and saying, “I’ll take the blue one.” Immediately the salesman whips out his order pad and starts asking questions. “Do you want a radio?” “How about the fancy wheels?” “Did you want the two-tone paint?”
Yachts with a legendary name, such as a history of celebrity ownership, can ask higher rates just for the “fame” value
In general, you’ll find two basic rates: high season and low season, usually with specific dates set for each. In addition, you’ll find special events that are more expensive: New Year’s Eve, Monaco during the Grand Prix, Cannes during the Film Festival, the Olympics or the America’s Cup.

The key is to choose your times carefully. A difference of one week (from high season into low season) can make a vast difference in cost, while still providing the same weather as the more expensive period.

The yacht itself is a major factor in determining the charter cost, but it’s not just about size. A recently launched charter yacht from a famed builder with an experienced and popular charter crew is going to command top prices for its size range. Yachts with a legendary name, such as a history of celebrity ownership, can also ask higher rates just for the “fame” value. And yachts with special features, such as alfresco movie theaters or exceptional water toys (a submarine, for example) are also pricier.
Bear in mind that every charter yacht, because they are privately owned and the owner sets the rules, is slightly different
Three different 30-metre charter yachts may vary in cost by as much as 75,000 Euros. Ask your broker to explain the differences. One yacht may have a larger and more experienced crew or a big-name chef, another yacht may be a little tired, another may not be in a prime location. It’s important to understand why the prices are higher or lower.

Knowing the base price of your charter is just the starting point, however, depending on the location, which often governs the terms of the contract (see Contracts), more or less may be included in the base price of your charter. Bear in mind that every charter yacht, because they are privately owned and the owner sets the rules, is slightly different. One yacht may include a “standard” selection of wines with every meal and charge only to upgrade the vintages, while on another yacht the wines are a la carte.

Under Mediterranean Yacht Brokers Association (MYBA) charter contracts, which are arguably the most common, the charterer is charged for food and beverage (for the charter guests only), fuel, dockage and harbor fees, and miscellaneous expenses. As a round number, which depends on how much fuel the yacht uses and how fancy the meals and drinks, you can expect to add 25% to 50% of your charter cost.

Shore-side electricity is also an added extra
Shore-side electricity when at a dock is also an added extra | Image courtesy of Jeff Brown / Superyacht Media
With the more inclusive Caribbean Terms Inclusive (CTI), which is sometimes called Standard Caribbean Terms (SCT), three meals per day and fuel for four hours of cruising a day are included. Some yachts under CTI terms include basic beverages (not vintage wines or champagnes), but this is mainly in the Virgin Islands.
One thing to understand is that the extras, from food to fuel to wine, is charged at cost to the charterer without markup.
Whatever the terms of your charter contract, you should understand the Advance Provisioning Allowance. This is an amount of about 20-25 per cent of the charter fee for a “plus all expenses” charter and about five per cent for an “all inclusive” charter. It is sent to the yacht before the charter to provision the yacht according to your preferences. During the charter, the captain will provide a running account of the usage of the funds and, at the end of the charter, the captain will present a detailed accounting along with any unused funds in cash. If the APA balance runs low during the charter, the client is expected to provide the captain a sufficient amount in cash to cover the needs for the remainder of the charter. Since many charterers prefer not to carry quantities of cash, the charter broker can hold an amount and release it to the captain as needed.

Before you book a charter, your charter broker can provide you with a good estimate of the additional costs that will be incurred. Food is one of the largest and it is directly proportional to how exuberantly you plan to dine. If you expect several bottles of Cristal champagne with every meal, then you can assume that your costs will be higher.

Fuel can be another cost and, again, it depends on how much the yacht cruises and how fast, too. Time spent at anchor will include the fuel for the generators, while shore-side electricity when at a dock is also an extra. Don’t forget that fuel is also charged for the tenders and water toys, so you’ll pay for the fuel used while zipping around on the jetskis.

Harbor fees and dockage are a variable that can range from exorbitant (a front-row dock at the Monaco Grand Prix) to little or nothing in some areas. Communications are another cost and, with the options for satellite communications and Internet, an important one for most charterers. A delivery fee is usually charged if a charterer requests to board (or depart) a yacht at a distance from where the yacht is normally based.

Harbor fees and dockage are variable costs
Harbor fees and dockage are a variable that can range from exorbitant to little or nothing in some areas | Image courtesy of Superyacht Media
All the yacht laundry, including towels, sheets and table linens, is included in the charter fee, but some yachts charge to launder personal items of the charterer. Most, however, will do small quantities of personal laundry as a service but they usually won’t be responsible for delicate items.
While it may seem at first glance that the extras on many charters are just a way to pad your bill, they are actually a benefit to the charterer
One cost not directly related to the operation of the charter yacht is insurance for the charterer. Cancellation and curtailment insurance is the charter version of travel insurance on airlines and cruise ships: It covers the charterer for the costs if unforeseen circumstances force a cancellation or shortening of the charter. Your charter broker can provide this insurance, which is a wise investment.

Last, charterers may be charged VAT, or “value added tax”, on the charter fees. Many European countries and a few Caribbean islands add VAT, but it is a complex issue that depends on where you board and debark the yacht, so rely on your charter broker for advice.

While it may seem at first glance that the extras on many charters are just a way to pad your bill, they are actually a benefit to the charterer. Food and drink, for example, is custom-ordered to meet the client’s requests, so the level of expense is entirely up to the charterer. Fuel is only charged if it is used and other fees are also at the discretion of the charterer. So you do have a way to control your costs and still savor a luxurious charter.
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