‘Tesla’ of the Seas Set to Electrify Luxury Boats

A boat company is setting out to become the “Tesla” of the seas by selling high-tech electric sports boats.

Startup Arc Boats is set to release a $258,000 Arc Sport boat, following its $300,000 luxury cruiser Arc One.

Boat owners are becoming interested in electric boats because they are quieter, more reliable, and cheaper than gas alternatives, Arc Boats said.

CEO Mitch Lee began his mission to electrify boating in 2021 when he started Arc Boats with his friend Ryan Cook, using money he earned from selling a personal finance app called Penny.

Electrifying boats had been in the back of Lee’s mind since Tesla rolled out its first car in 2008 and he started to wonder if the technology would eventually work on boats.

The company began with luxurious vessels likely to appeal to a small and affluent audience that is not reluctant to spend large sums of money to own the latest advances in technology.

Customers include people like Jonathan Coon, who are not traditional boat owners.

“My view on boats had always been that the best kind of boat is someone else’s boat because they can be such nightmares,” Coon, 54, said during an interview from Austin, Texas, where he is overseeing the development of a lakeside community.

“But that’s not the case now. These guys just nailed every little detail on an electric boat that’s just fun to use,” said Coon, who made his money after starting 1-800 Contacts in his college dorm room back in the 1990s.

After purchasing the luxury cruiser Arc One a couple of years ago, Coon is forking out to become the first customer in line to get Arc Sport—a model made for popular aquatic pastimes such as wakeboarding and water skiing.

Lee has so far only sold a handful of Arc One luxury cruisers, but has plans to ramp up production to sell hundreds of the Arc Sport model a year, targeting key boating areas such as California, Texas, Idaho, Minnesota, Michigan and other parts of the U.S. with lots of lakes.

The first Arc Sport is supposed to be delivered to Coon before the end of this year.

“There’s a lot of enthusiasm for a product like this, because it solves all these core pain points that gas boat owners have today,” Lee, 35, said while piloting an Arc Sport on the San Joaquin River near Bethel Island, California.

Just like Tesla’s vehicles, the Arc Sport will be equipped with a variety of technology that will make the boat akin to a floating computer.

The boat comes with display screens, sensors, Wi-Fi, and a hydraulic system for raising and lowering the roof.

Lee hopes software updates will make it possible for the boat to autonomously dock.

It was the development of electric cars that provided the tools to make electric boats possible.

The success of Tesla’s vehicles, along with other electric cars, finally created a supply chain of batteries and other parts needed to electrify boats.

Arc Boats now employs more than 100 employees, including former engineers who worked for Elon Musk at two of his companies—Tesla and rocket ship maker SpaceX.

Other electric boat companies are also entering the market, but compared to electric cars, the market is still tiny.

Worldwide sales of electric boats stood at just $5 billion in 2021, and are projected to reach roughly $17 billion by 2031, according to Allied Market Research.

In contrast, global sales of electric automobiles surpassed $250 billion last year.

This article includes reporting from The Associated Press