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Asian Yachting Industry Continues to Grow at Fast Pace

Posted by at 25 August, at 19 : 12 PM Print

Asian Yachting Industry Continues to Grow at Fast Pace

Over the past few years, Asia has rapidly been becoming a major yachting hub for that part of the world and beyond. Taiwan has been at the forefront of this trend, but more recently, other countries in the region, specifically the countries of Southeast Asia – Malaysia, Thailand, Indonesia, and the Philippines – have all been experiencing major growth in the motor yacht industry.

According to a recent report in the Business Review, the global yacht industry is expected to reach US$74.7 billion by 2022, driven by the rising interest in luxury cruising among high-net worth and ultra-high net worth individuals, particularly in developing regions of Asia-Pacific and the Middle East, which are benefiting from a growing trend towards marine tourism and water-based sports and leisure activity. “The business has generally grown as buyers have become more appreciative and attracted to the lifestyle pleasure and benefits that yachting brings,” says Vrit Yongsaku, Group Managing Director of Boat Lagoon Yachting, one of Asia’s largest yacht importation, and distribution centers. “As their experience grows, the trend also moves, towards the bigger yachts [from 60ft to 130ft].

What Is Driving the Asian Yacht Market?

On the one hand, the economy is driving the boon in the Asian yacht industry. While shipyards in the states continue to flounder, and are seeing a significant number of closings and acquisitions, their Asian counterparts thrive simply because their costs of operation are so much lower. But, the industry is being driven by more than just the economy.  For one thing there is a growing number of high net worth expats moving into the region, and taking to the water. Furthermore, South East Asian destinations continue to flourish, as Asia is slowly realizing its full potential with the market experiencing a healthy level of demand for yacht charters, as clients look for an exciting alternative to the Caribbean.

Beyond all that, over the last few years, there has simply been a change in attitude toward boating in the region that is picking up steam. We see people beginning to move away from the purchase of smaller boats and lower quality production yachts, and becoming more interested in custom built and higher quality luxury yachts. There is a growing understanding of pleasure yachting in the area.

While much of that change in perspective is being driven by emerging wealth in China, it also has much to do with what the region has to offer as a yachting destination.

Southeast Asia abounds with islands known for their exotic beauty, which are also a source for some of the best SCUBA diving and sport fishing in the world. That is creating major opportunities for charter yacht businesses. A recent report by the World Travel and Tourism Council said that Southeast Asia is expected to be the fastest growing global sub-region over the next decade.

Not All Smooth Sailing

Despite steady and predicted growth, there are still many issues in Southeast Asia that stand in the way of the region achieving its full potential as a motor yacht hub — infrastructure and lack of marinas being two of the main issues. However, this is steadily improving, together with governmental support of many countries, particularly Indonesia, Singapore, Malaysia and Thailand.

While the Asian market continues to grow, still, Yongsaku is quick to point out that there are significant differences between Asian motor yacht buyers, and their European or American counter parts. “Chinese ultra-high-net-worth individuals tend to require less powerful motors,” Yongsakul explains. “They want larger indoor areas for corporate entertaining activities with smaller outdoor decks and fewer sleeping cabins and they like to be part of exclusive marina clubs. Not many want to have to pay over the odds with regards to import tax from Europe, but they are willing to spend significantly to hire a crew rather than managing their yachts themselves.

Horizon Yacht Under Construction in Taiwan

“In the West, buyers tend to go for superyachts, which are faster and smaller in size; along with more toys. Additionally, because of affordability, a mid-size boat of 50ft to 60ft is always manned by an individual and his family. However, here in Asia, we are quite fortunate as having a full-time captain and crew is extremely affordable, so no matter the size of the boat, typically everyone has either a crew or a captain.”

Taiwan Continues to Set the Example

This trending uptick in the Asian market, began with Tawain, and is now spreading throughout the region, yet Taiwanese shipbuilders continue to set the bar for carving out new markets, and how to become more competitive with the West. On a recent trip to the region, we have seen firsthand how the quality of these Taiwanese boats continue to not only improve, but evolve to meet the needs and desires of today’s yacht buyers.

Moving ahead, I anticipate Asian yachts, such as those currently being built by Horizon Yachts, Dyna Yachts and President Yachts to continue to take on a leading role in the 70 – 140ft range.

 

Our Visit With President Yachts

 

It’s not always easy to stay on top of what’s new in motor yachts. If you would like to benefit from our expertise in these areas, or if you have any questions or comments about this blog post, do not hesitate to contact our Sales Specialists, or call us at (855) 318-6328.

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