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Some Covid buyers are selling

Some yacht owners during pandemic are returning to dry land.

The pandemic has caused a “massive surge” in yacht sales, said Richard Allen, chief operating officer of Hong Kong-based yachting company Simpson Marine.

“We saw a lot of these people, who had their boat for two years, now wanting to travel,” he told CNBC. “Probably over the last few months, talking to other people in the industry, we’ve seen an increase in brokerage activity of…boats being sold.”

It was expected, said Paolo Casani, CEO of Monaco-based yachting company Camper & Nicholsons.

“We sold, as an industry globally, more than double the number of yachts (in 2021) compared to 2019,” he told CNBC. When that happens, “they go to market a few years later.”

Price on the second-hand market

Yachting enthusiasm remains high, even though sales have fallen since 2021, Casani said.

“The industry is moving back to 2019,” he said. “And you have to distinguish between brokerage and new construction, because the demand for new construction is still quite high.”

With more yachts hitting the brokerage market, prices are down, albeit slightly, from pandemic-era highs, he said.

The demand for yachts is

“Prices remain quite high,” he said. “There is still a gap between demand and supply… but we believe there will be further reduction by 2024.”

Asia yacht growth ‘lower than expected’

However, some yacht buyers in Asia are not selling, Allen said – in fact, they are trading up for larger vessels.

“Some have actually really enjoyed the boating lifestyle and are already upgrading to larger boats,” he said.

Asia – a continent of growing wealth and numerous island nations, many basking in year-round heat – has long been seen as the next frontier for global yacht growth.

Casani and Allen, who spoke to CNBC on April 26 while attending the second annual Singapore Yachting Festival, agreed that the yachting market on the mainland is growing.

But, Casani said, the pace is “lower than expected” for many reasons, including culture, lifestyle and lack of infrastructure.

Asia is beautiful and warm, but this is what its yachting industry is like

“But we remain convinced that Asia has very high potential,” he said.

Allen said disparate and onerous “rules and regulations” in the region are thwarting progress.

“We need to facilitate the movement of boats between regions,” he said. “In one country you can drive a boat of a certain size, but in another you can’t. So that sort of thing – red tape, shall we say.”

Complex visa requirements for foreign boat crews are problematic, as are high import taxes, which can reach 40% in some markets, he said.

“We have to do a lot of lobbying with governments to make it easier to import boats,” Allen said. “There are many pressure groups like ICOMIA… who work much more closely with the different concessionaires to have a voice with government.”

The International Council of Marine Industry Associations, or ICOMIA, held a two-day conference ahead of the Singapore Yachting Festival to address issues facing the industry, from sustainable propulsion to the lack of marina infrastructure in countries with high potential, such as Indonesia. , Philippines and Vietnam.

Beyond purchasing and charters

Simpson Marine estimates the global water recreation market will reach approximately $46.5 billion in 2027, which it says will trickle down to the local economy through job creation and tourism revenue.

“The yachting industry employs thousands and thousands of people who build boats, maintain the boats and service all the components,” Allen said. “This is a…great industry that countries can embrace.”

New forms of ownership are making yachting cheaper, which opens the industry to more people. A particularly popular model in Australia is fractional, or syndicated, ownership, in which owners buy a share of a yacht, he said.

Others avoid ownership altogether and opt for flexible subscription models, which are now the standard for many forms of entertainment, from music to television.

“We’ve seen massive growth in boat clubs,” Allen said. “It’s a bit like joining a gym or a golf club. You pay a monthly membership and you can use a boat several days a week. And it’s very popular for people who don’t really want to have the hassle of owning a boat.

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