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Yacht Charter Costs Explained
When you begin planning a luxury yacht charter it is important to be aware of what is included in the cost of booking your dream charter yacht. Although a yacht will have a base charter fee, this may or may not include additional expenses such as food and fuel and this is subject to the terms and conditions within the charter contract. The price of the charter depends on a particular destination, type of charter contract, as well as the size of the boat, year of construction, number of guests/cabins, amenities, crew, etc.
This article will go into detail of the costs to be expected when planning and booking a yacht charter. From the base charter fee of a yacht, what is covered within the fee and how it may vary in addition to details of contracts and how an Advance Provisioning Allowance (APA) can be used to manage any expenses.
It is quite obvious that the total price of the charter will depend on:
- the size of the yacht (its length is measured in feet or meters),
- its year of construction,
- conditions,
- number of guests allowed/number of cabins,
- types of cabins (king-size/queen-size/tween-size),
- number, qualifications and experience of the crew members,
- types of amenities, etc.
Generally, the bigger and newer the boat - the more expensive its charter is. For example, the 7-day charter on USVI of 2019 Fountaine Pajot 45 feet sailing catamaran would cost you $20,000 for 6 persons "all-inclusive", at the same time the same 7-day charter on BVI of 2022 Sunreef Yachts 80 feet sailing catamaran would cost you $105,000 for 10 persons "all-inclusive".
The base charter fee in essence refers to the hire cost of the yacht itself, with all equipment in working order in addition to the cost of food and wages for the crew during the entirety of the charter. This is essentially all the base charter fee covers with additional expenses often applicable on top. The base charter fee will vary from one yacht to another and this may be down to any number of reasons from size and onboard amenities to the charter season. For instance, the base rate of a charter yacht may increase in "high season" and reduce during the "low season". "High season" and "low season" refers to the busiest and slowest periods for yacht charters though this may appear misleading, as these peak times refer to periods of weeks as opposed to full seasons. In addition, you may find that a yacht is also more expensive during special events such as the Monaco Grand Prix, Cannes Film Festival and America's Cup. Unless you are keen to charter a yacht for a particular "high season" event, choose your dates carefully as although a "high season" rate will be more expensive than the "low season" the two can sometimes share much of the same weather conditions.
High Season
High season refers to the most popular weeks of the year for yacht charter, whether it’s the winter period in the Caribbean or the height of summer in the Mediterranean, booking in high season requires early planning, determination, and a big budget. In addition, planning a yacht charter to coincide with a major event will also be reflected in the price with marine spots for elite events often booked up early. Allow plenty of time when making inquiries to ensure a star-studded, well-prepared arrival.
Low Season
The low season typically refers to any time outside of the high season periods. Groups of families and friends looking for a relaxing luxury vacation are advised to avoid high-season weeks and opt for weeks outside of this time. The busiest periods are of course reflected in the charter costs and can be up to 15 to 30 percent more expensive than typical low-season periods. Chartering a few weeks on either side of these busy periods can be almost exactly the same, with the weather almost unchanged in some places, with far fewer crowds.
Take to our detailed destination guides and browse the yachts available in your chosen destination. Some of the most successful superyachts in the industry can be reserved up to a year in advance and as most yacht brokers will warn away from last-minute bookings, it is better to book early and have the pick of the bunch rather than miss out at the last moment.
The type of charter contract applicable to your charter will depend on where in the world you are cruising, as there are various terms within the industry which dictate how the payment structure is determined. For instance, an MYBA (Worldwide Yachting Association, formerly known as Mediterranean Yacht Brokers Association) contract operates under Western Mediterranean Terms (WMT) and is arguably the most commonly used, particularly with large yachts embarking on a Mediterranean yacht charter. This contract is often referred to as a "plus all expenses" contract and requires that the charterer pays for fuel, food, beverages, and dockage fees as an additional expense outside of the base charter fee. Typically, guests can accumulate an additional 25% to 50% of the base charter fee though this is dependent on what is consumed. These expenses can be tracked through the use of an Advance Provisioning Allowance (APA) which we will cover in the next section.
Alternatively, yachts on a Caribbean yacht charter can expect a "mostly all-inclusive" contract known as Caribbean Terms Inclusive (CTI) sometimes referred to as Standard Caribbean Terms (SCT). The Standard Caribbean Terms greatly differ from Western Mediterranean Terms, as the Caribbean terms include three meals a day in addition to four hours of cruising per day which is included in the base charter fee.
In addition to the commonly used MYBA terms and Standard Caribbean Terms, there are also less frequently used terms such as Standard Eastern Mediterranean Terms (SEMT) and Greek Terms (GI). Read our guide on "Understanding Charter Contracts" for more information and if you are unsure as to what is included under the terms of your contract, be sure to ask your broker.
Aside from seasons and events, yachts of the same size may also differ in price and this may be down to a vast difference in onboard amenities. A yacht that boasts an onboard cinema or lavish water toys may have a higher base rate compared with a yacht with minimal amenities of the same size. If it is unclear as to why two yachts of the same size are vastly different in price, ask your yacht broker to explain what the differences are. Once you are clear on what the base price is and why, it is important to discover what costs will be applicable on top and this is dependent on the type of charter contract used.
Irrespective of the charter contract it is important for guests to be aware of the Advance Provisioning Allowance (APA). The APA was designed to enable charterers to manage their expenses through a clear and trackable arrangement. An APA is a way to deposit the estimated expense amount of your charter to cover costs such as fuel, food and dockage fees. Typically, the APA accrues to approximately 25% to 30% of the base charter fee, though this does of course depend on the charter parties tastes and requirements and could be far less or far greater than this estimation. For instance, charter guests who intend to regularly dine on caviar and vintage wine can expect to pay more, whereas guests on board a sailing yacht charter can expect to save on fuel costs. Charterers can request an estimated APA amount from the yacht broker based on their on board expectations.
The APA is to be paid approximately one month prior to boarding the charter yacht and is paid directly to the Captain of the yacht. Once the APA has been paid to the captain it will then be retained as a bank account of sorts, from which the captain can make expenditures whilst keeping a record of what has been spent. At any point during the yacht charter guests can request a rundown of accounts from the captain as a way of keeping track of expenditures. The captain will request that any additional funds are paid during the charter should guests exceed the APA. It is therefore a good idea to keep an additional account with your yacht broker on shore, as should the APA become critically low at any time the yacht broker can release additional funds to the captain on the charterers command. Cash can be used if necessary though an on-shore account may be deemed as hassle-free to some.
It is important to remember that food and fuel for example, are charged at cost without markup to the charterer and upon disembarking, transactions can be reviewed by the "head" charterer and Captain with any remaining funds to be paid back to the charterer.
Fuel and Dockage Fees
It is important to remember that whilst considering fuel costs, the fuel consumed when using jet skis and tenders will also apply to the charterer. In addition, whilst docked at a marina the generators used in order to produce electricity will also use fuel. The distance traveled and speed of cruising also affects fuel costs and it is important to bear these factors in mind. Dockage fees may vary from very little to large sums and this is dependent again upon the location and whether you wish to dock during a special event such as the Monaco Grand Prix.
Insurance
Although insurance costs are not directly connected to the charter costs as such, it is highly advisable to take out Charterers Liability Insurance or Cancellation and Curtailment cover. You can read more information regarding insurance in our "How to Book and Plan a Yacht Charter" article.
European Union (EU) tax laws state VAT will apply should you disembark within their waters, for example Italian territorial waters. This may also apply to some Caribbean islands. Commercially registered vessels are usually VAT exempt though vessels which are not commercially registered will be liable for VAT for all charters within the EU.
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