Are people buying new boats at the moment?

[oldgit]

Seem to recall that not that long ago big ticket boat purchases were mainly cash sales, with very few funded by borrowed money.
Perhaps this is no longer the case ?
Suspect that the purchasers of such boats are not likely to want that fact on view to any que in the food bank.

 

[PowerYachtBlog]

imho, boat prices may be rising, but that doesnt mean they are selling.
all it represents are the hopes and aspirations of brokers.

For the global brands with big dealers sales are safe, since the market has also expanded a lot.

Absolute/Azimut/Princess/Sunseeker/FerrettiGroup and even Sanlorenzo (in bigger sizes) has a global market today, which expands all around the globe.

A couple decades ago the main market for them was the Med and Europe with the exception of Azimut who had a really strong presence in the US since the nineties.
Now the Med is about 30/20% for the sales volume versus the 50/60% it was a decades ago.

So lets take a Princess V50 which cost like 1.2 million, and probably Princess has a production run for ten units a year, expandable to fifteen/twenty subject to the other model orders and supply chain issues (something btw which you will never know about).
Right now Princess needs to get ten V50s ordered from its dealers to fill its 2025 production, and for them 2024 is sold out, and if you are in Southampton they will gladly tell you 2026 is the next slot with a cheeky smile.
With a global order book for them it is not hard to fill ten new boats (two Italian, two France, Norway/Denmark/Sweden, UK, US, Mexico, South American countries etc etc) It is not that hard for them to sell ten boats of a model (average production of a model nowadays) a year.

 

[roa312]

For the global brands with big dealers sales are safe, since the market has also expanded a lot.

Absolute/Azimut/Princess/Sunseeker/FerrettiGroup and even Sanlorenzo (in bigger sizes) has a global market today, which expands all around the globe.

While I agree that the manufacturers have expanded globally, I'm not convinced this necessarily makes their businesses any 'safer' or less cyclical. Expanding into new and growing markets means increasing production (the volume portion of volume/price-mix in revenue), which leads to higher overheads and fixed costs. Additionally, during an economic downturn, demand for new high-end luxury yachts is probably one of the hardest hit industries. Demand across different regions (EU, NA, Asia) is potentially highly correlated, and closely tied to general interest rates and leading stock indices. If that is the case, then manufacturers, regardless of market size, will struggle in a downturn as they wouldn't be able to offset a decrease in one market with growth in another.

Moreover, it's been noted that manufacturers have increased prices and margins over the past few years. This could potentially worsen the impact of an economic downturn, as both ends of the volume/price-mix could then be going against them.

On a different note: I think the average of 10 boats/year per model sounds a bit low - at least for the 40-80ft section of the market. According to Boat International's "Worlds Leading Manufacturers over 24m", Princess, for example, launched 48 yachts last year (snippet below) and I don't think they have more than c.5-6 models in that range(?). I know that there has been at least 4-5 new deliveries of the Princess v50 to Denmark alone to date in 2024, which I think is consistent with previous years. However, I don't have any statistics at all for the <24m market (!), so I'm very interested in hearing if you have any data (just out of curiosity). I also know from work experience that the market intelligence providers can vary widely and are not always dependable - people tend to just provide the agency as the source and be done with it !

 

[PowerYachtBlog]

My ten boats per year, was an average, a new model usually gets boosted to 20 (estimate) and some models keep on going strong.
A source for example told me that Princess was making 15/20 V40s in 2022 (they could have made double that in that year) but due to supply issues, most of which from engines could not do it.

Also as you named Princess at the moment (again Boat Int source) have 28 yachts in build above 24 meters in length, which is only six models in S(1), Y(4) and X(2) ranges,
28 yachts per year might be spread up to 2026.

That list is also blurred as well, for example the Azimut-Benetti number does not mean 167 per year but projects in build.
Steel super yachts which Benetti builds about 10/20 a year above 50 m plus the 37 meter Montopanfilo take about two/three years to complete.

Worth to note that Benetti and some other builders like Sanlorenzo, Heesen, Mangusta new steel/alu builds have an important line of semi-production model which they start to build on speculation. which will reduce build time by a quarter/half times, sometimes even more if you are not to specific.
Speculation is widely use in GRP construction and can also be dealer used for some very big names (Azimut/Sunseeker/Princess/Ferretti).
Sanlorenzo for example use it as well, but probably along with Overmarine Mangusta (hardly use it) and rather cautious in it.
Ferretti use a similar Sanlorenzo approach of starting a build in the CustomLine series, while the yachts below 100ft for the various can be dealer ordered on speculation.

 

[DAW]

Information on the state of the market quoted in publications like MBY and Boat International is usually supplied by the builders and not the dealers/distributors. In some cases (e.g. Sunseeker) the builders are supplying major markets through dealer networks which are under separate ownership. These dealers commit to minimum volumes and book manufacturing slots 12-18 months in advance. While the orders may be confirmed from the builder's perspective, the distributor/dealer doesn't necessarily have customers for all of the boats they are ordering.

A quick trawl through the websites of the European distributors of popular models such as Suneeker, Princess, Azimut, Ferretti, etc.will reveal plenty of new 2023 and 2024 model year boats for sale ... so presumably stock boats still waiting for customers. If you make a serious inquiry, some dealers also have other boats in-build, available and not yet on their websites on which a deal is possible ... and its usually possible to order now for delivery direct from the factory in 2025. I would say this is a marked change from the situation 18 months ago.

 

[Chris H]

Information on the state of the market quoted in publications like MBY and Boat International is usually supplied by the builders and not the dealers/distributors. In some cases (e.g. Sunseeker) the builders are supplying major markets through dealer networks which are under separate ownership. These dealers commit to minimum volumes and book manufacturing slots 12-18 months in advance. While the orders may be confirmed from the builder's perspective, the distributor/dealer doesn't necessarily have customers for all of the boats they are ordering.

A quick trawl through the websites of the European distributors of popular models such as Suneeker, Princess, Azimut, Ferretti, etc.will reveal plenty of new 2023 and 2024 model year boats for sale ... so presumably stock boats still waiting for customers. If you make a serious inquiry, some dealers also have other boats in-build, available and not yet on their websites on which a deal is possible ... and its usually possible to order now for delivery direct from the factory in 2025. I would say this is a marked change from the situation 18 months ago.

The Princess and Fairline dealers in Sanremo both have at least 6 brand new boats each for sale, dosent look good for Fairline when two identical boats are side by side for sale.

 

[Fire99]

This isn't a very scientific observation but I caught a youtube channel 'Super Yacht Captain' and one of his European locations on his new command, were unusually quiet and an engineer I know who works out in the Med, said boat movements were significantly down. So I wouldn't be surprised if European sales were down. Other continents may be very different I'm sure.

 

[PowerYachtBlog]

The Princess and Fairline dealers in Sanremo both have at least 6 brand new boats each for sale, dosent look good for Fairline when two identical boats are side by side for sale

Fairline has a new dealer in Italy in the last two/three years, with the old Fairline dealer who was very strong (he took best Worldwide dealer for a some years in around the noughties, and was selling like thirty plus units in around the T47 and T52 times) taking Princess in the last three/five years.

 

[Parabolica]

With the UK builders its easy enough to see that their problems come late as they all sell to their dealers. So when dealers are having it away as they did following Covid up until rates started to rise significantly in early 2023 and times were once again very good, they ramped up significantly at the request of the dealer network who were all ordering larger numbers to ensure they didnt miss out. But with products where you have long build lead times, when the tide turns it takes a while to effect the source of supply. And now where you have those same dealers with stock unsold and therefore reducing their forward order book with the factories, the outcome is obvious.

It’s a shame that when things got better< supply wasn’t controlled more to ensure demand remained in place to weather the economic change, like Rolex do for instance. But i get it, whilst still a luxury item, a boat is a very different product.