Yachting Insights: Post Show Report
Posted On: 29 Nov 2018
What does the future hold for the yachting industry? Attending high profile industry shows and conferences is all part of Business Development Director, James Porter’s daily remit. Here he shares industry insights from the recently attended Monaco Yacht Show and the Superyacht Forum.
The uncertainty of Brexit, along with jurisdictions being challenged over their leasing structures (Malta and Cyprus), are just two of the hot topics currently in the news regarding the yachting industry. As a business that advises existing and potential owners about all aspects of yacht ownership, it is essential that we are up-to-date with the latest views and discussions taking place. Attending high profile industry events such as the Monaco Yacht Show and the Superyacht Forum, is vital in staying ahead of the game and making sure that we’re involved in the discussions with key opinion leaders. Here are some of my post show thoughts and insights:
Monaco Yacht Show: Post Show Report
The highly prestigious annual Monaco Yacht Show attracts the elite of the yachting industry to Port Hercules each September, and this year was no exception.
In recent years the show’s organisers have invested heavily in encouraging new blood to the show, with specific events aimed at potential buyers and Family Office representatives. Those who attend are able to meet with a specialised audience of industry experts across all aspects of the superyacht market. These include naval architects, marinas, shipyard builders, yacht brokers, marine suppliers and everything in between. In addition, the show launches many of the new builds making their worldwide debut, and this year around 40 yachts debuted at what was the 28th annual event.
For us personally, it is definitely the key yachting event of the year, and I am pleased to report that this year proved the busiest by far. Anthony Page (Managing Director) and I met with existing clients and advisers, industry contacts, key decision makers and potential clients during the show period. While we don’t exhibit at the show, for 2018 we had a shared stand area with Superyacht UK within the Darse Sud tent, which enabled us to reach a wider audience.
The conversations we engaged in inevitably included Brexit, a topic that has led to a great deal of uncertainty for the industry. The other hot topic of discussion during Monaco was the challenge of the Maltese and Cypriot leasing structures. It is well known within the yachting industry that the EU Commission issued a notice to Malta and Cyprus in March of this year, advising of their intention to commence infraction proceedings against them in relation to their leasing structures. Malta robustly defended the structure while agreeing to revisit the general terms.
What we do understand is that guidelines to the new Malta Leasing structure have been drafted, but delays with formalising these guidelines continue.
On a more positive note, the show reaffirmed that the yacht market is thriving with yacht sales continuing to rise and many companies stating that 2018 has been their most successful year on record. Speaking with a number of our industry contacts, some indicated that they felt this increase in sales is due in part to the US high-net-worth economy, which received a recent lift through the tax breaks President Trump has introduced.
Our industry colleague, James Ludden (Director) at 3 Yacht Management had this to say regarding the 2018 show:
“Following what can only be described as a successful MYS 2018, we came away with a few highlights to take forward into the next year.
It was evident from discussions with our clients and prospective clientele that there is a strong desire for a personal approach to yacht management services between all parties involved.
The foundations of 3 Yacht Management were established with this as its leading principle and its core business model has been built around the need for a personalised service. Our internal management pods allow us the flexibility to focus on bespoke management options that are tailored to the requirements of each individual client.
To ensure that our clients receive the highest levels of service, it is vital that we work with trusted and diligent service providers. From a professional Trust Company/Family office, such as the team at Knox House Trust, to the newly formed cyber security companies, it is imperative that we, as a company, ensure that we engage with only the best available.”
Conclusion:
So with more deals signed than in previous years and a sense of increased market activity afoot, the docks of Port Hercules were definitely feeling positive vibes as the show came to a close. We are already putting plans in place for the 29th edition of the show, when we hope the full scope of Brexit will be fully known.
The Superyacht Forum: Key Takeaways
Having undergone much change to the event in recent years, the 23rd edition of The Superyacht Forum took place in mid-November in Amsterdam. The three day event hosted a powerful meeting of industry minds from across all sectors of the superyacht market, including insights into new tech developments, relevant business insights and the latest innovations from a broad spectrum of keynote speakers as well as think tank talks and social interactions.
“The Future of Superyacht Ownership – The Perfect Customer Journey” was the core theme for the 2018 edition, with each day dedicated to a specific stage in the process of ownership – from understanding ownership through to enjoying ownership and everything in between. Particular highlights for me included:
A panel discussion with some of the industry’s brightest minds who explored how, in the current climate of every-increasing transparency, both public and legal perception of various taxation structures has changed, as well as how various jurisdictions have had to evolve their practices in order to benefit the superyacht owner.
During a session called ‘The Insurance Market’, the industry debated the factors that have created the insurance market’s race to the bottom, as well as analysing where the market is going and how this translates into tangible benefits for superyacht owners.
Another highlight was the ‘Business of Ownership’ workshop which discussed flagging regulation, finance and management from the perspective of professional service companies, covering all aspects of ownership and use of superyachts.
However, it was the ‘Future of Brokerage’ which stole the forum limelight! Delegates heard from passionate yacht owners, including Ahoy Club and Yotha who explained how their new initiatives are reinventing models of ownership and charter. Ahoy Club in particular announced that they have launched a digital platform for chartering, and went on to promote their guarantee, which seeks to offer the lowest booking rates in the market, and will smash the current 20% model offered by the majority of yacht charter brokers. Needless to say, this session prompted much resistance from the marketplace.
The forum covered all aspects of the customer journey and inevitably the ways in which the industry can continue to make improvements came to the forefront of the debate. Overall, the conversations with owners addressed many vital issues and highlighted areas where the industry and marketplace need to make improvements, not just in order to survive, but also to thrive in these uncertain times.
To discuss any aspects of our yachting services please contact us today.