The covid pandemic has certainly made its impact on the maritime industry as a whole, but we thought we’d take a closer look at the superyacht sector specifically as here at Spinnaker, we’ve noticed an uptick in superyacht roles, indicating a promising outlook for that sector.
Difficulties for superyachts
Firstly, it’s not all been good news for the sector. Significant markets for superyachts have been hit hard economically by covid; the US economy is expected to shrink 3.5%, the UK suffered a 9.4% drop in GDP forecast and Russia’s GDP slumped by 4%. We know from the rest of the industry that lockdowns have led to recession which have led to rising unemployment.
The costs around chartering superyachts are, as we know, significant, and with new uncertainty around safety of staff there is a new importance that charterparties are as crystal clear as possible on the repercussions of if contractual duties are unable to be upheld due to the pandemic.
Savings and investments
However, according to Boat International, household wealth has been relatively well protected during this time. At the start of the pandemic, many wealthy people retreated to their superyachts for large portions of 2020 to avoid the pandemic.
The psychological effects of the pandemic has also encouraged some with the wealth behind them to “seize the day” and buy that yacht they’ve always wanted. According to Boat International’s discussion with Burgess Yachts, the “20-30m market is on fire” at the moment.
Shipyards have seen a slow in sales, but no actual order cancellations, which is promising.
Boat shows and international travel were suspended for most of 2020, which was detrimental in lots of ways but did also lead to companies saving money that way. Savings in the bank can only be good for companies during market uncertainty.
There are new considerations for the superyacht industry when it comes to covid safety. What happens if the crew or guests need to isolate? How will they get tested on board? Are there covid contagious hotspots they should avoid cruising to?
For the UK, one of the hardest hit countries during the pandemic, the Bank of England is predicting a highly positive return to normal for the economy once lockdown restrictions are lifted. If we see this confidence worldwide, a return to normal service for superyachts could be a realistic goal for 2021 and beyond.
Provided that the covid conditions worldwide continue to be stable, boat shows will return, and the orderbook will be healthy once again.
Spinnaker has definitely noticed an increase in shipyards and brokers recruiting for the superyacht sector in recent months. “Market optimism and the projected easing of lockdown measures due for the summer and beyond have combined to give our clients confidence to hire and build their teams,” says Spinnaker Managing Director Teresa Peacock. “Across the board, the brokers I am speaking to all say that the market is buoyant.”
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