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The impact of the pandemic on the yachting industry

Following a year defined by unprecedented restrictions on communal interaction and long-distance travel, we wanted to look forward to the impact this time has had on the yachting industry.

Despite the negative impact of Covid-19, the yachting industry has seen some positives, more than anyone could have imagined. We spoke to Alan Knight from Princess Motor Yacht Sales, and the British Marine Federation to find out more.

A surge in demand for yachts
The first and most striking consequence of Covid-19 has been a rapid surge in the demand for yachts. In response to the suspension of international travel and social interaction, those with the funds for an annual holiday began to use their free time to examine other options. In place of traditional hotel-based breaks, more isolated outdoor activities, closer to home, began to soar in popularity. The Great British ‘staycation’ became the go-to solution and, thanks in part to the ‘Summer on the Water’ campaign initiated by the UK’s trade body, British Marine, watersports were a key part of that.

However, at the same time as the pandemic was helping invigorate demand for yachting, it was also bringing about a short-term delay in yacht building productivity. Factories were forced to close and boatbuilders were compelled to introduce 24-hour shift work in order to bring production techniques into line with social distancing imperatives. For some builders, the issue of getting boats finished was also exacerbated by disruptions in the flow of outsourced parts and components and, of course, with soaring demand and faltering supply, the competition for boats became extremely intense.

As Alan Knight, UK Sales Manager at Princess Motor Yacht Sales, points out, marine leisure became a seller’s market almost overnight: “In a traditional recession, boating gets affected. But in the pandemic, those who managed to retain their income streams found themselves unable to book a cruise or a holiday, so they looked at what they could do – and as a result, the sheer volume of new boat owners has been extraordinary.”

The impact on yacht brokerage
According to most brokers, it was after the easing of the first lockdown and on the cusp of the summer that the enquiries really began to spike. In May 2020, many brokerage firms reported sales figures four times higher than in previous years, alongside a far greater proportion of queries from first-time boaters than ever before. There are stories of multiple buyers competing over asking-price purchases within 24 hours of postings being made live – and some operators also noted a steep increase in yachts being bought without a physical viewing. New, as well as used, boats began to face shortages and, as Alan Knight puts it, in the wake of that new landscape, “customers have come to realise that they’ve got to be pretty on the ball if they want to buy a boat.”

A fresh way of interacting with boaters
In the forced absence of traditional outlets like marine exhibitions and high-end lifestyle events, boatbuilders have had to work hard at making their products visible. Across the board, websites have been supplemented with improved information on design and engineering, as well as filmed walk-throughs and sea trials. There have also been upgrades in the value and interactivity of digital content and, while
the easing of restrictions will no doubt bring a renewed fondness for face-to-face negotiations, the increased fidelity of the industry’s digital dialogue is here to stay.

Alan Knight explains: “Selling boats would normally involve a lot of travel, but we had to adapt during 2020. We had to use Zoom, Teams, FaceTime and video conferencing. We even did live FaceTime walkarounds inside boats, enabling customers to decide what to look at and where to go. It became very much an interactive viewing experience rather than a generic 3D tour, and there’s no doubt that it has helped deliver the confidence and clarity boat buyers want.”

From 2020 to 2021: the trade body assessment
British Marine Federation (the trade association for UK marine leisure) has no access to monthly boat registration data so it is unable to assess market performance in real time – but the picture it paints on the basis of anecdotal evidence certainly tallies closely with Alan’s impressions. While the impact on boating tourism was of course significant, Lesley Robinson, CEO at British Marine Federation, points to “record monthly orders and sales figures from prominent boat and equipment retailers during the summer”, as well as “a boom in watersports activity from marinas and marine safety organisations”.

This broadly positive picture has been reflected elsewhere in Europe too. In Finland, for instance, which already owned more boats per capita than anywhere else in the world, overall figures for the year show a 19% growth in boat registrations, with the strongest increase in powerboats under 23 feet. Finnboat (the trade body for the Finnish marine industry) also found that a third of boatbuilders expect to take on extra staff in 2021, while only 2% anticipate letting staff go. And while just 7% of marine firms predict a decline in turnover during 2021, almost half are expecting significant increases. Of course, in nations where marine trade is tightly bound up with yacht charter and international marine tourism, the picture is less positive but, in the main, it appears that the UK and European perspective remains one of guarded optimism.

Lesley added: “British Marine expects the UK market to continue its recovery in 2021, with demand for boating products remaining strong. As restrictions on international travel are yet to ease and other countries are not in the same position as the UK with vaccination, boating and watersports should hold their attraction among British consumers.” And while premium yachts are currently flourishing, Lesley also anticipates continued growth at the all-important entry point to the market: “I expect that smaller boats and watersports craft (dinghies, RIBs, canoes, kayaks and SUPs) will see growth during this period, due to their accessibility in terms of skill level, affordability, mobility and ease of storage.”