Julia Stewart - The Superyacht Group

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THE STATUS OF THE NEW BUILD MARKET UNRIVALLED SUPERYACHT INTELLIGENCE


RAPHAEL SAULEAU

JULIA STEWART

CEO, FRASER

DIRECTOR, IMPERIAL YACHTS

Predicting the future of the 30m-plus new-build market can be incredibly difficult, given the amount of secrecy that is typically involved in the deals. New builds have, without doubt, been impacted as a result of the pandemic because most of the customers struggled to travel, so we have certainly seen a reduction in new contract activity. But when travel resumes, I expect there to be a positive amount of activity in 2021. From the data that we have available, which is an approximation of new-build activity, we had already seen a decrease in activity of 37 per cent on 2018 and 16 per cent on 2019. However, it is important to remember that up to 2018 the build slots at the market’s top shipyards were full up, so they were busy delivering projects rather than filling up new slots. This lack of capacity at the shipyards may have had a direct impact on the generation of new business. To add to this issue of capacity, 2020 was obviously a difficult year for all. I would predict that if we resume relative normality in 2021 then it will be incredibly interesting to assess whether the new business market is rebounding or not, and at which shipyards. Otherwise, it will be three (there is a downward trend in the number of contracts signed since 2019) years in a row that new contract activity has declined. Fortunately, a

number of the top yards have taken the initiative in recent years by building new sites or acquiring new yards and premises, which should have a positive impact (there seems to be an issue of availability of slots only in the larger size segment around 70m-plus). I expect that we will continue to see more market consolidation, but there are still a lot of builders today and I think the future will be challenging for some of them. The top ones, however, continue to do reasonably well.

Predicting the future of the 30m-plus On the Imperial side, our company has entered into ground-breaking contracts for new-build construction in 2020, including the striking 120m Project Signature, to be built at the Amels and Damen Yachting facilities. Despite the pandemic situation that hit the planet and strongly affected the global economy, this period was the right moment for those ready to take risks for their clients to stand out from the crowd. By risks, we mean getting deeper into negotiation with partners to find the right deal. This leads to our point of view: new construction will continue to strengthen, but only for brokers with a particular expertise in the largest superyacht sector. Together with Project Signature, and the recent deliveries of Lana [Benetti 107m] or Flying Fox [Lürssen 136m], we have observed the market is at a special moment of its growth. The COVID-19 situation has offered new perspectives to superyacht owners, and so today they are looking not only to explore the world, but to do so under the safest conditions. The independence offered by a superyacht to discover the seven seas is unrivalled in the current situation, and we believe it will continue into the near future. Pairing with ecological concerns, we are about to face a new era of yachting and one that is more responsible.


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