By Rya Jetha. Bay City News.
Summer is peak season for charter boats in the Bay Area. The weather is nice, kids are out of school, and tourists from all over the world are visiting San Francisco.
But this year, the peak season has become painful for many charter boat owners, who are having to raise their prices or cut their profits because of record fuel prices. Some are even rethinking owning boat rental companies.
"Business has definitely slowed down a little bit, it's not as busy as it has been the last couple of years," said Steve Talmadge, owner of Flash Sports Fishing Charters based on Hyde Street Pier in San Francisco.
Talmadge recalls going to work seven days a week during the peak summer season for the past two years. His weekends used to book up months in advance. But this July, he has five weekend days still open.
“I can see just from the calls — we’re not getting as many. Households are having a harder time surviving, so they have less money to participate in boat charter companies,” Talmadge said, speaking of how inflation is affecting customer interest in fishing in San Francisco Bay.
Talmadge's own operation has been hit hard by high fuel prices. His boat, like most charter boats, runs on diesel.
"I don't understand why diesel is so much more expensive than regular fuel, and our ships burn a gallon per mile. When you go from $3 to $7 a gallon, it has a huge impact," he said.
Currently, the price of diesel at Gashouse Cove, a popular fueling dock in the San Francisco marina, is $7.75 a gallon.
Talmadge couldn't afford to keep charter rates the same as he was shelling out more money at the pump. He raised his prices this May, increasing them from a half-day charter per person from $200 to $250 and a half-day private charter for six people from $1,100 to $1,400.
"We tried to hold on. But it was too much, we just couldn't do it," Talmadge said.
Other fishing boats in San Francisco Bay are also raising their prices.
Michael Rescino, owner of Lovely Martha Fishing Charter in Fishermans Wharf, says the cost of operating his boat is about double this year compared to last year because of higher fuel prices.
Rescino raised his prices last month from $200 to $220 for a full-day rental, but “honestly, it’s not enough,” he said.
Rescino's boat is larger than Talmadge's, with a total capacity of 20 people compared to six.
“This was the best halibut season we’ve seen in a long, long, long time, and it was hard for us to fill the boat,” Rescino said. “And that was when the price was $200!” He raised his prices, the salmon fishing season looks promising, and he’s started to attract customers.
"At first, people didn't make reservations, but they see that the fish - salmon - are biting and they start calling," said Rescino, hopeful but unsure of what summer holds.
San Francisco Bay is also home to charter flights for tourists, which have also been affected by high fuel prices.
Charles Jennings, owner of Bay Voyager for 12 years, offers a variety of boat tours of the bay from Pier 39.
“We talk about the history of San Francisco Bay, we take pictures of the passengers, we go fast and slow, so it’s the perfect combination of excitement and learning about our beautiful city,” said Jennings, whose business is currently the number one San Francisco boat tour on Tripadvisor, based on more than 800 customer reviews on the online booking website for destinations and experiences.
Jennings has charged adults $$99 and children $$69 since 2017 for its popular 90-minute ride under the Golden Gate and Bay bridges. This year, it has opted not to raise its prices.
"The whole inflation thing makes me sick, because I think a lot of inflation is just a few rich people being opportunistic," he said.
“When you hear that oil companies are making record profits — not sales, profits! — that’s wrong, and that’s why I haven’t raised my prices at all. I’ll have to eventually, but I’m not going to do it yet,” he said, referring to the record profits Big Oil made in the first quarter of 2022.
The top five oil companies alone – Shell, ExxonMobil, BP, Chevron and ConocoPhillips – generated 200 percent more profits in the first quarter of 2022 compared to 2021, totaling more than $35 billion in profits in just three months, according to the Center for American Progress, a Washington, D.C.-based public policy institute.
ExxonMobil's net profit doubled from the same period last year, while Chevron reported its highest quarterly profit in nearly a decade and Shell had its highest quarterly profit ever.
Jennings also believes the high cost of fuel is affecting rental boat owners more than most other businesses because boats are very expensive to maintain and operate.
“Most businesses, of course, have expenses, but when you have a boat, it’s amplified, because boats are expensive,” Jennings explained.
“Ask anyone: what are the two most memorable days of owning a boat? Buying it and selling it! There is a very real reason behind that,” he said, adding that after hiring employees, fuel is the next biggest expense for the boat charter business.
The stress of the pandemic coupled with inflation this year is making Jennings reconsider owning his own business and working long hours most days of the week.
“It makes you wonder: is this the industry I want to stay in? I love what I do, the people who come on my boat love what we do, but something doesn’t make sense. It’s painful, and every boat owner feels it,” he said, adding that despite his best efforts to provide customers with a premium experience, he believes he is earning around minimum wage.
“Especially since the COVID thing I really questioned, am I doing all this to give people a premium experience on minimum wage? With the stress of being a business owner? What’s the point of that? And it doesn’t!” he concluded.
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