Luxury yacht order book increases by 7.9% • 15.5 miles of yachts under construction The Netherlands, Germany, Denmark and China gain orders U.S. and U.K. slip • Motor yachts over 150 LOA feet up 15% • Expedition yachts up 35%.

Continued Success: 2006 Global Order Book Shows Luxury Yacht Builds Continue to Increase

Reflecting continued optimism in the face of a rapidly changing global political and economic climate, the luxury yacht market continues driving upward, albeit at a more sustainable pace. After a banner year in 2005, which revealed a market increase of 28.4% due to pent up demand post-9/11, the market continues growing with 81,631 feet of yachts representing 688 projects currently under construction or on contract. The increase, 5,746 feet more than last year’s total, is mainly due to motor yacht projects 80 to 119 feet and also those 150 feet and larger.

Orders for motor yachts 120 to 149 feet show a 5% decline. Sailing yachts continue their slide, down seven to 52 boats accounting for 8% of the total number of builds. However, Palmer Johnson returns to its roots with a 90-footer due for an October 2006 launch. It’s reported that Lürssen is building a 295-footer, the largest sailboat on the list.

The open-style yacht, a category that rocketed onto the scene in the 2005 Global Order Book, is holding stable at 87 builds. Interest in expedition yachts, which slowed last year, has taken hold again with orders increasing by 35%. Attribute part of this to Northern Marine: Four of its seven builds are expedition yachts, compared with one in 2005. New builders in the mix also contributed to the increase. Nationally, China and Brazil are the leading builders of the breed. (Click image to enlarge)

Azimut-Benetti retains its position as the top builder on the strength of its total construction footage at 8,237 feet. The Ferretti Group, with 77 charted yachts under construction, surpasses Benetti’s hull count by eight but trails in the total length by 180 feet. These two builders, together with 20 other Italian yards, keep Italy atop the Builder Nations list with a commanding 260 yachts accounting for 29,591 feet under construction, increases of 5% and 8%, respectively.

Country Rankings Change

Although the United States and United Kingdom each suffered a 4% decrease in orders, it wasn’t enough to change their respective rankings of second and fourth among the Top 10 Builder Nations. In fact, the top four retain their standings. Germany moves up into fifth place with an increase of 1,180 feet and two additional builds. China moves up to sixth, largely on a bonanza of 82-footers reported by Marlow Marine. Denmark moves into eighth place with an increase of 1,426 feet and a 93% jump in the number of projects. Peter Johansen, president of Royal Denship explains the increase is due to an order from Peters plc., a British distributor adding 85- to 105-foot yachts to its portfolio in response to clients wanting bigger yachts but wishing to remain within the dealer’s service network.

Custom Rankings Shuffled

The line between custom and semi-custom yachts is becoming increasingly blurred, particularly among larger, semi-production offerings. Owners of semi-custom yachts are often no longer first-time buyers and believe an investment of $20 million-plus entitles them to more than just choosing gloss or satin finish on their joinery. While the production builders have responded with multitudes of variations, there is still a substantial difference between enclosing an aft deck and moving the hot tub and starting from scratch.

View the complete 2006 Global Order Book here.It’s equally problematic to distinguish between custom and series production yacht manufacturers. Some companies, such as Benetti, build yachts on both a production and a custom basis. Other companies, particularly yards manufacturing large fiberglass yachts, build custom interiors in a series production hull.

Thus, we’ve refined the way we look at these subjects. In defining criteria for the custom builder rankings, the editors drew the distinction between semi-custom and custom production based on their knowledge of the builder’s willingness to substantially tailor individual projects, particularly as they relate to re-engineering for power packages or weight distribution, designing unique superstructures, reconfiguring interior spaces, and installing owner-specified equipment. Combined custom and semi-production totals are noted separately. (Click image to enlarge)

Benetti retains its grip on first place among custom builders, but this time by a smaller margin and based solely on its 14 unique projects over 160 feet, which together total a still-staggering 2,640 feet. CRN, which was in second place last year on the basis of its combined custom and Custom Line projects, is now ninth on the basis of its six truly custom builds.

Feadship moves into second, nudging Lürssen into third position. Trinity, the largest custom builder in the United States, moves up one to fourth place. Meanwhile, Burger advances three places up the chart to 10th on an increase of 109 feet. Delta makes a triumphant return in 13th place after slipping off the list in 2005. Germany has a strong showing with the additions of Blohm & Voss and Abeking & Rasmussen in eighth and 15th places, respectively. (Click image to enlarge)

Large Builds on the Rise

Contracts for motor yachts 150 feet and larger increased 15% to 118 builds from 103 in 2005. Of those, 33% are over 200 feet. While anomalous projects such as Octopus and Rising Sun are off the list, Peter Croke, managing director of Merle Wood & Associates, says he’s noticed a definite trend in "normal" yachts getting bigger as yachtsmen appear once again interested in trading up. For example, Abeking reports three new orders, all well over 150 feet. The same is true for Heesen. Whereas the yard had a lone 154-footer on last year’s list, five of its 12 current projects are over 150 feet. Thom Conboy, Heesen’s director of sales, attributes the increase to "a consistent product line, good brand image campaign and a lot of buyers." Of course, all the builders on the lists are enjoying the latter detail. (Click image to enlarge)

Ground Rules

The purpose of this listing is to provide a body of data— compiled in a systematic fashion at the same time every year—showing the scope and breadth of economic activity within the luxury yacht community for vessels of at least 80 feet LOA. The cutoff for the Global Order Book is September 1, although shipyards are permitted to add orders that materialize prior to deadline. Every effort is made by the editorial staff of ShowBoats International to assure the accuracy of the data and that projects are under construction or under contract with deposits in hand. Whenever possible, the data is cross-referenced with other industry sources. However, collecting this information in an unregulated international industry is difficult at best. Nevertheless, the editors believe this order book listing and analysis is an accurate reflection of existing business in the luxury yacht industry as of September 27, 2005. (Click image to enlarge)

Data compiled by Bill Ando.