An outboard motor is a product whose price is governed by several factors. These products come at a premium price instead of a budget price. Boat owners are assumed to be economically gratified by default, so a few economics’ concepts of “pricing” come into action here But, why do outboard motors cost so much?.
Consider the example of a sports car and an ordinary family car. A sports car’s price is higher, since the owners are assumed to be well-off by default, and their demand is somewhat low compared to budget family cars.
The usage, quality of the overall product, and durability all together affect an outboard motor’s price. This product is considered a luxury product, which further increases the cost.
Let’s dive why boat motors – in particular outboard motors – cost so much. Without further to do, let’s jump right in.
Factors Affecting Price Of Outboard Motors
- Low Demand And Supply
- High Quality
- Higher Income Target Market
- Longer Life
- Research And Development
- Outboard Monopoly
- Incredible Performance
Low Demand And Supply
Very few people buy outboard motors, which means that the demand is relatively low than other engine types. The low demand automatically increases the prices of these outboard motors drastically. Any product’s cost tends to fall or rise on the graph based on the correlation of its demand and supply.
Many manufacturers don’t even make the least expected income out of the outboard motors. No matter how much the production is, they must maintain all the plant and machinery and labor. Company expenses must carry into the cost of products, irrespective of each year’s total sales. For this, manufacturers ask for more money per piece. If the demand were high, then the final price of each item would automatically fall.
The quality of the boat motors is impressive. These motors, made with a large percentage of copper, are pretty expensive. In addition to that, the overall internal wires and other materials used to make up the entire product must deliver high quality. It is essential because these motors must survive when submerged in the water.
In other words, outboard motors are marine grade, which is best suited to survive in extreme conditions. These motors must be tough enough to withstand damage from moisture, water, and a salty, harsh ocean environment. Such durable products are always expensive. The boat motors have to pass many quality assurance tests to ensure that they’re safe for use in dangerous conditions. It further adds up to the final price of the product.
Targets People With Higher Income
The higher income side of society primarily owns boats. Since the outboard motor manufacturers target this income group, it’s natural for these products to be expensive.
The people boat manufacturers target can afford more expensive products, and high prices don’t bother them like they might a lower-income person. So it’s relatively easy for the manufacturers to pull some extra money out of their pockets. Targeting higher-income people and selling the products for huge profits is common when it comes to luxury products. Outboard motors quickly make it to this list.
Longer life means people would rarely buy another motor anytime soon. It’s well-known that durable goods are slightly expensive. The same is the case with an outboard motor. Staying inactive for a long time reduces their lives, but these motors still work well when maintained.
Research And Development
Most outboard motors manufacturers include colossal research and development costs in their products. Since they’re spending a lot of time and money in this domain, they expect something in return from the customers. Adding to the final price of the product ensures that the research and development process continues.
Research and development are entirely expected costs, which almost every manufacturer includes in their final price irrespective of the industry. One such example is Apple Inc. Also, the technology used in these motors is different, and it would be very kind if the buyers would happily spend a little more to aid the research and development process.
Outboard Motors Are The Standard
Many modern boats come with an outboard motor as a standard. Since the owners will have no other choice but to buy the outboard motor, it becomes a kind of monopoly for the manufacturers. As a result, they can charge as much as they want within a practical, sensible limit.
If sold with other motors as standard, it would be challenging for the outboard motor manufacturers to claim their monopoly.
Offers Unmatched Output
The output delivered by an outboard motor is quite good. The engine can bear decent loads and offer excellent results. Traveling by boats have no alternatives. An outboard motor is a perfect fit for many watercraft, and so, there’s no way that any other thing can replace these motors. It’s normal for prices to rise, considering this scenario. You will notice that the return on investment of an outboard motor is acceptable.
Is It Worth Buying Outboard Motors?
Now that there’s a massive difference in an outboard motor’s prices and an ordinary engine, many people might consider opting for a compatible substitute.
Yes, buying an expensive motor is worth every penny. Considering a vast difference in the output, quality, etc. replacing an outboard motor with an ordinary motor is a big mistake. Any standard and or compatible engines must NEVER substitute an outboard motor.
Even though an ordinary motor might work perfectly fine initially, it’ll be a significant headache shortly. Regular maintenance, substantial repair costs, and finally replacing it with a new one will hurt your pocket more severely.
Why Outboard Motors Cost So Much – The Bottom Line
The bottom line about why outboard motors cost so much is that the manufacture is a precise process and the product is not only complex, but also must be completely waterproof, for obvious reasons. And then encase the entire thing to make safe for use. But it doesn’t stop there!
With a lower sell rate than engines going in cars, but a more complex assembly, the cost of these engines is much higher, relative to similar land based engines of comparable horse power.
Combine these facts with the target buyer being a slightly higher income group than the average person, and it’s a recipe for a more expensive product.