FLIBS Report: Trending Upward

Sales of imported yachts continue to grow, in both unit numbers and average lengths
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Midnight at the Oasis: FLIBS could set another record for sales of imported yachts. 

Midnight at the Oasis: FLIBS could set another record for sales of imported yachts. 

Exhibitor numbers at the Fort Lauderdale International Boat Show were up this year, reflecting the buoyant mood across the industry. Our editors noticed two trends at both ends of the FLIBS spectrum: an increase in launches by non-U.S. yacht builders and a rising category of single-outboard pocket cruisers smaller than 30 feet.

The National Marine Manufacturers Association’s 2017 U.S. Recreational Boating Statistical Abstract shows consistent unit and revenue gains for imported boats from 2010, when category sales were $937.8 million, through 2017, when sales doubled to $1.89 billion. The 2017 sales were not only an 8.3 percent gain over 2016, but also surpassed the 2007 record of $1.47 billion. Inboard yachts accounted for $1.1 billion of last year’s imports. Most of the international builders were European (61.9 percent), but there are growing numbers from Asia, Australia, Turkey and Brazil.

The outer docks at the Bahia Mar Yachting Center had the largest European builders, including Azimut, Ferretti, Sanlorenzo, Sunseeker, Monte Carlo, Prestige and Princess, with smaller builders such as Grand Banks, Maritimo, Pearl, Johnson and others along the inner docks.

Judging from the levels of activity at the booths and enthusiasm from exhibitors, 2018 could be another record year for imported yachts. “The show exceeded our wildest expectations,” says Bill McGill, chairman of MarineMax, which imports the Azimut and Galeon brands. “Despite whatever negative trends are out there, this show turned out better than we could’ve imagined.”

Federico Ferrante, CEO of Azimut of the Americas, says his company sold several boats on opening day, and activity remained strong throughout the show. Sales continue to grow, according to Ferrante, with the number of boats sold in the United States increasing from about 50 units in the five years after the downturn to about 100 units this year. The Italian builder introduced the Azimut S6, 25 Metri and Atlantis 51 at FLIBS.

“We’ve seen growth from both a recovering economy and the added value in distribution because of the Sea Ray shutdown,” Ferrante says, referring to Brunswick’s decision to close down Sea Ray’s yacht and sport yacht facilities. “That created opportunities for us, since a number of owners wanted to stay in the MarineMax family. They migrated to Azimut or, in some cases, the Galeon brand.”

Several of the European imports have a long history in the United States. Azimut imported its first yacht in 1989 and established a U.S. office in 2004. “We did $226,000 in sales that first year,” Ferrante says. “Now, 14 years and 16 employees later, we’re doing about $170 million in new-boat sales, with $14 million in trade-ins and $1.5 million in parts and accessories.” The Americas accounts for 39 percent of Azimut’s global sales.

Ferretti Group’s Stefano de Vivo: “Sales of boats over 100 feet are skyrocketing.”

Ferretti Group’s Stefano de Vivo: “Sales of boats over 100 feet are skyrocketing.”

The Ferretti Group also has seen a strong return from its investment in the Americas. The parent of seven high-end brands says it expects to close the year with $515 million in sales, 36 percent of that from the Americas. Ferretti Group’s big sellers in the United States are Custom Line, Ferretti and Pershing. The company introduced the Pershing 9-X and Ferretti 670 at FLIBS, with 20 other boats on display.

The Ferretti Group will sell about 30 boats to U.S. owners this year, chief commercial officer Stefano de Vivo says. “Our new-boat sales have been stable, and we’ve seen tremendous sales with brokerage boats with our Allied Marine division,” he says.

Most established European brands have offices in Fort Lauderdale, while newcomers such as Baglietto and CCN have set up new offices. Azimut and Ferretti have made significant investments in service personnel and parts. Ferretti has about 50 employees in the United States, with 30 in customer service, and another 45 brokers working with Allied Marine. South Florida represents its largest presence outside Italy.

“We have a million dollars’ worth of spare parts in 70,000 square feet of U.S. warehouses,” de Vivo says. “It’s a significant investment, but we realized early on that we’re not just selling boats. We need to provide excellent service to retain our customers.”

The Italians’ biggest competitors are not U.S. builders, but British and French companies. Prestige, owned by France’s Groupe Beneteau, is the largest-selling brand in its motoryacht category, while U.K. builders Sunseeker and Princess, which offer a wider range of sizes, go toe-to-toe with U.S. market leader Azimut.

The builders say numbers are not just rising because of more units sold, but also because the average length of yacht is increasing. “Sales of boats over 100 feet are skyrocketing,” de Vivo says.

“In 2016, the boats we were selling into the U.S. averaged 50 to 70 feet. Now, it’s an average of 70 and 80, and even up to 100 feet,” says Sean Robertson, president of Sunseeker USA. “Unit numbers have increased, as well. We expect to sell 50-plus boats in the U.S. this year.” The U.K. builder opened Sunseeker USA in 1994.

In the last 20 years, European companies building yachts larger than 60 feet have grown in the United States, while their U.S. counterparts have dwindled to several premium brands, such as Marquis, Hatteras and Viking.

“If you to go Europe, it’s a struggle to compete with American competitors up to about 35 feet,” Robertson says. “After 50 feet, it’s a bit of a blank among the American builders. They are mostly products designed for fishing or other niche activities. They don’t work for our clients.”

Ferrante says the invasion of European motoryacht builders is due to buyer preferences. “There’s a sexiness in the Italian lines that satisfies the need for beauty,” he says. “The leading U.S. brands are designed for sport fishing, and while they’re pretty to me, we’re seeing a lot of older people migrating to the European motoryacht category.”

European builders also have an edge thanks to research and development. The Ferretti Group invested $153 million in new-product development from 2015 to 2018, launching 30 models. Other European builders also spend large amounts on new products just to compete with each other.

The Sunseeker 76 competes with other U.K. and Italian brands rather than U.S. yacht builders.

The Sunseeker 76 competes with other U.K. and Italian brands rather than U.S. yacht builders.

Princess Yachts demonstrated that at FLIBS with its new R-35, a red, all-carbon sportboat. The 35-footer, with its innovative active foil system, was designed by America’s Cup syndicates and Formula One racing teams. “The active-foil control is like nothing else in the industry,” says Anthony Sheriff, chairman of Princess. “Fuel efficiency is improved by 35 percent, and it’s more stable, easier to pilot at speed and more comfortable in a chop. We’re planning to introduce this technology going forward on our larger yachts.”

That kind of innovation is expensive, but it could give Princess an important edge on competitors going forward. The U.S. market accounts for 20 percent of Princess’ global sales. “We’re growing in volume and market share,” Sheriff says. “We’ve seen that number rise over the last five years, so now our biggest challenge is having enough production.”

Smaller European and Asian builders view FLIBS as the main foothold into the U.S. market. Taiwan-based Johnson Yachts says U.S. ownership accounts for about 95 percent of its annual production, with Netherlands-based Zeelander saying the same. The two brands couldn’t be more dissimilar in style and pricing, but the diverse tastes of U.S. buyers has allowed both to grow their respective markets.

“Nine out of 10 Zeelanders are sold into the U.S.,” says commercial director Leonardo van den Berg. “Americans don’t go for me-too designs like boaters in other countries.”

The influx of non-U.S. motoryachts shows no signs of slowing, with ever-larger models and prices. Zeelander announced its Z720 flagship at FLIBS. The 72-footer has a base price of $3.2 million.

This article originally appeared in the December 2018 issue.

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