In a major milestone for the international superyacht industry, and tantalizing encouragement for the entire marine industry that better times are ahead, Showboats International 2009 Global Order Book reveals the number of orders for yachts – power and sail – 24.38m/80ft and longer has surpassed the 1,000 mark.
This represents an increase of 11% on 2008 and comes in the face of rising fuel, a stagnant world economy and the global banking crisis.
120 builders contributed to the results, with a total number of projects standing at 1,019, well up on the 916 of this year.
The magazine’s editors herald this increase as 'nothing short of remarkable', considering the broader boat market. 'The US recreational boating market has declined by nearly 30% over the past three years, and more declines are expected in 2009,' the report reads.
The main growth segment was the yacht size range between 80 and 200ft, in which orders increased by 10.5%. The most growth was seen in the 150 to 199ft category, increasing by 16%.
The year’s strongest growth in terms of units came in the motor yacht segment, with the sailing yacht segment remaining stable.
Italy’s Azimut-Benetti and the Ferretti Group were the top placed builders, followed by the Rodriguez Group from France, the UK’s Sunseeker, InRizzardi Group, Fipa Group, Lurssen, Sanlorenzo, Camuzzi Nautica and Trinity Yachts from the US.
Interestingly, Horizon Yachts and Kha Shing from Taiwan came in at number 16 and 18 on the list of Top Builders, their plum location in the middle of the most significant emerging market, as identified by the top builders.
Azimut-Benetti has broadened its focus beyond the UK, US and Europe to target China, Southeast Asia – including Hong Kong and Singapore – and Middle East buyers in the UAE as well as Saudi Arabia and Egypt. The company has also made considerable investment in Russia with a marina in Moscow and an agreement in the final stages for another in the Black Sea.
Azzura Marine, Hanseatic Yachts and Warren Yachts made the list for Australia’s top builders.
While all builders who responded to the survey reported positive order books for 2009 and believe that while the megayacht industry is insulated against much of the turbulence, they do concede that their customers face some uncertainly due to the US-led financial crisis and they anticipate some drop off.
The issue is not that the upper end of the market will be hurt in the fallout, says Cheoy Lee’s director, B.Y. Lo, but that psychologically, customers may hold off buying a massive yacht while the world’s financial markets are in turmoil.
Since the reality is that more than 50% of yacht owners rely on finance, the dust needs to settle on the credit crisis before potential customers are willing to sign on the dotted line.
Many of the major players have countered this reluctance to buy with their own in-house credit divisions, including Azimut-Benetti, whose own finance arm is called Yachtique.
Elated with his company’s 11% increase in orders on this year, CEO of Azimut-Benetti, Paolo Vitelli says the Yachtique initiative will prove important to the company’s future strategy and growth.
High fuel prices have impacted on sales as well as the type of vessels people are seeking, with a slight shift from planing towards more fuel-efficient displacement hulls.
Fuel-efficiency is only part of the equation, as customers’ appetites for more luxury has also characterized the market. People are not so much seeking speed, as creature comforts, according to builders.
The weak US dollar has led to a veritable flooding of the European market of cheaper second-hand US boats, causing a problem for European builders.
But aggressive marketing and an emphasis on product differentiation have led to a growth in orders across the board of the top ranked European builders, from Italy, The Netherlands, UK, Germany and this year, Russia, which has entered the list at number 20 with Timmerman Yachts.
Consensus is that further constriction of the world’s economy will lead to attrition of the weaker players. While 'good product will continue to do good business', as Paolo Vitelli says, experts predict that natural selection will take its toll over the next year.
Top 10 builder nations – Global Ranking 2009 (determined on orders in total length):
Country / No of projects
Italy 523
USA 113
Netherlands 77
Germany 32
UK 75
Taiwan 53
Turkey 28
China 28
France 17
Russia 13
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