Like many in the luxury sector, business leaders in the yachting industry often hark back to the period before the financial crash. “Those years up until 2008 were very strong,” says Raphael Sauleau, CEO of full-service yachting company Fraser Yachts. “Then the bubble exploded. Now we have more of a market without huge peaks.”
Sauleau is standing on the deck of Pink Gin, a sailing yacht moored in Monte Carlo’s marina, which is available to buy through his company. It’s the opening of the Monaco Yacht Show (MYS), one of the industry’s last big autumn fairs in Europe before the whole circus sets sail for Florida. But it’s the best place to gauge the temperature of the sector. “Fort Lauderdale is a key show,” says MYS director Gaëlle Tallarida. “But it doesn’t have the same ambience as Monaco. There is more of a mix of people; it’s not so exclusive.”
While the majority of the delegates are in attendance to sell, many are refreshingly honest about the state of the market. Philippe Briand is one of the industry’s leading designers and is here launching a 70-metre yacht, Sybaris. “We won’t see an improvement tomorrow,” he says. “In the early 2000s there was too much demand; now we have a normal, mature market.”
After the frenzy of the previous decade there is a huge existing fleet already on the water. That spells trouble for shipyards: it’s more difficult to convince someone to build a boat from scratch when there are so many available to charter or buy secondhand. As such, yards are having to think creatively as they search out opportunities for growth beyond 2017.
According to Sauleau, the segment of the market that deals in yachts over 80 metres long is “booming”. While it has traditionally been dominated by German shipyards such as Lürssen, the Italians are muscling in. Ferretti Group has just announced further investment (€20m by 2021) into its Superyachts Yard in Ancona, which can build boats up to 90 metres.
Meanwhile, Benetti (part of the family-owned AzimutBenetti group), has launched an innovative new manufacturing model called Benetti Now. The scheme seeks to reduce delivery times by taking boat building closer to serial production: the shipyard will construct superyachts based on predefined naval platforms before securing buyers – something the industry has never done before.
“There is of course a risk in doing ‘ready-to-wear’ manufacturing,” says ceo Vincenzo Poerio. “But that’s the advantage of being a family-owned company. You have to invest even if that means making less profit.”
While optimism might not be the right word for what the industry is feeling right now, it’s clear that its top yards and designers are confident. The market has stabilised and there is a sense that growth will return. As Briand puts it, “There will always be a premium for the best professionals, the best shipyards and the best designers.”