Boats are a type of human vehicle that swim. Usually, the boats that Crypto encounter are either weakly armed or defenseless. However, there are also boats that are very strong and hard to defeat like The Hate Boat.
The only place where you can see a boat in this place is Union Town. At the Naval Base, there is boat docked on land, probably for display. It appears to be some kind patrol boat from World War I or World War II. Boats also appear in Santa Modesta, but they are very rare and there's only one in the whole game. Sometimes it spawns in a driveway or by the beach.
This is the second game where boats appear. This time, they can be seen swimming in the water and they are completely defenseless. But, there is also a version where they are armed with missiles (they probably appear during a wanted level). They are used by Fantasy Atoll's security. During the mission "Da Hate Boat", Crypto and Pox are sitting in the Saucer, Pox's Holopod picks up a message form Mr. Pork telling them how angry he is that they destroyed everything he has and he has no choice but to destroy them with his battleship named The Hate Boat (a parody of The love boat). Thus, a battle breaks out. Pox tells Crypto to use torpedoes against The Hate Boat, but it turns out that Mr. Pork has some type of electronic shields around the boat. So Pox tells him to destroy the shield generators and then proceed to throw things at the boat in hopes that it will destroy Mr.Pork. You must throw things faster, because Mr. Pork will try to fix his generators. If you do so, you will damage The Hate Boat faster and eventually complete the mission.