Luxury yacht order book increases by 15.3% | 17.9 miles of luxury yachts under construction | Italy, U.S., the Netherlands, UK, Germany, Taiwan and France increase orders | Sailboat builds increase by 13.5% | Motor yachts up 12.9%

The 2007 Global Order Book for luxury yachts shows a total of 777 yachts 80 feet and larger under contract, totaling 94,404 linear feet. This total represents a 15.3 percent increase in footage from 2006, continuing an upward trend that was reported in the 2004 GOB report. Also reported is an 89-unit increase in the number of yachts under contract, mainly in the 120- to 149-foot range, which increased from 98 to 141 projects.

What drives this market? Three years ago, Forbes magazine listed 476 billionaires on its list of the world’s richest people. The magazine’s most recent list, released in March, shows the number of billionaires around the globe has climbed to 793.

Looking at the global increase in wealth more locally, for the first time in the American business and financial magazine’s history, its list of the 400 richest Americans includes no multimillionaires; instead, the roster is full with those whose net worth is at least $1 billion. These figures give credence to an observation made by Billy Smith, vice president of Trinity Yachts, that "the wealthy [population is] increasing faster than the shipyards can build the boats they want." Yachtbuilders say that many of their new clients are from Eastern Europe, Russia and smaller Middle Eastern nations—places where yacht ownership is a new phenomenon.

Although the top three producing nations—Italy, the United States and the Netherlands—account for 65 percent of the total yacht footage under construction, newcomers and rising stars continue to join the luxury yachtbuilding scene. Brazil, for example, registered one yacht on the order book in 2001; this year’s list shows three yards building 11 yachts. As Smith noted, demand is outstripping supply for slots in custom yards. This is evident in some of the new yard names in the list: AMY (CNL), ThyssenKrupp, Hanseatic, Cyrus Yachts and Vegayachts. While some new yards may represent a single ad hoc build, the majority are enthusiastic businesses—many fronted by old hands in the business—representing exciting new projects and putting lots of talented people to work.

Italy, as Before

Italy retains its lead as the top yacht-producing country. Footage increased 31 percent, up to 39,104 feet from 29,804 in 2006. The number of Italian builds is up by 87 yachts to 347 units, claiming an astounding 45 percent of the world’s total production of yachts over 80 feet. Of the top 20 builders of luxury yachts over 80 feet, eight of the yards (40 percent) are Italian.

Stalwarts Azimut-Benetti and the Ferretti Group continue to impress with unit increases of 35 percent and 7.8 percent, respectively. In 2005 and 2006, the Ferretti Group showed more projects but less footage than Azimut-Benetti. This year, the dual-brand builder’s totals in both columns lead the list of top 20 builders.
Italy’s total benefited from other established yards with new ideas. Sanlorenzo’s builds have increased from six yachts reported in 2005, to a current total of 26. New, aggressive ownership brought new models to the market, and the company signed an important North American distribution deal with Viking Yachts, which accounts for five yachts on the 2007 list.

Rodriquez Yachts is taking advantage of yard acquisitions to post nine projects totaling 1,174 feet. Turkey once again makes it into the ranks of the top 10 builder nations at number nine. The increased activity includes Numarine building a 102-footer, Vitters producing 108-foot motor yachts under the Cyrus Yachts label and RMK Yachts starting build on a 171-foot Sparkman & Stephens sailing yacht.

Sailboats in Trim

Sailboats seem to go in cycles. Their numbers increased annually from 30 in 1997 to 72 in 2002, and then suffered a yearly decline trend. This year the number of builds increased from 52 to 59, returning to the 2005 level. Sailing yachts now account for 8 percent of the total boats under construction.

The regular names show up—Nautor’s Swan, Oyster Marine, Southern Wind, Royal Huisman, Perini Navi, Alloy Yachts—maintaining the luxury sailboat numbers at a reasonable level. The numbers from the regulars are bolstered by one-offs from yards more often associated with motor yachts. For instance: Lürssen is finishing up a 305-footer for a U.S. client and Derecktor is building Gemini, a 145-foot catamaran.

Custom Builder Ranks Change

On the strength of 18 boats under contract, U.S. builder Trinity moves to the top of the custom builder list. The builder, which moved to its new Gulfport, Mississippi, yard in 2005 on the heels of Hurricane Katrina, is also reopening its original New Orleans facility to accommodate its full order book.

New to the list is ThyssenKrupp, which bought Blohm & Voss and Nobiskrug. Combined projects from those yards put it at number seven, with seven projects totaling 2,179 feet. The builder’s average length of 311 feet is the largest average size on the list. Also new to the GOB, though it didn’t make the list of top 15 custom builders, is Vegayachts, a Monaco-based design and project management company building exclusively in Japan. The principal is Richard Hein, formerly of oceAnco, who has tapped many of his old team from The A Group. With a first-time showing, Rodriquez Yachts ranks at number 10.

U.S. builder Burger Boat Company moved up two places to eighth, with a jump from 977 feet to 1,528 feet, an increase of 56 percent. Burger’s builds increased from seven to 11 boats.Large Builds Increase Overall;
Remain Steady Over 200 Feet

The number of builds larger than 150 feet continues to climb. There was a 13 percent increase in 2005 in the number of motor yachts 150 feet or larger. Last year’s listings saw a 14.6 percent increase.

This year, 139 motor yachts 150 feet and larger are reported, an 18 percent increase over 2006’s total of 118. Forty-four of those are larger than 200 feet. Even with launchings, there is enough interest to keep the number steady. Of those, 27 are 200 to 249 feet and 17 are over 250 feet. The largest is NB 978, a 531-footer under construction at ThyssenKrupp’s Nobiskrug facility.

A new Sport Boat (SB) category was added this year to distinguish the 120-foot and larger yachts that aren’t really open yachts yet don’t fit the traditional motor yacht configuration. Only eight were reported, but if their popularity holds, that number will increase as builders join in the mix.

Order Book 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, to show the scope and breadth of economic activity within the luxury yacht community. The cutoff for the order book is September 1, although shipyards are permitted to add new orders placed before October 1, or as the deadline dictates. Every effort is made by ShowBoats International’s editorial staff to assure the accuracy of the data. 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 economic conditions in the luxury yacht industry. The editors will continue to update and clarify this listing as necessary during the year as new information becomes available.

Custom Builder Rankings

Editor’s note: It is always problematic to distinguish between custom and semi-custom yachts. 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 (and even superstructures) in series production hulls. In deliberating for the top custom builders ranking, the editors of ShowBoats International drew the distinction between semi-custom and custom production based on their knowledge of the builders’ willingness to substantially customize individual projects.

We initially used a liberal interpretation of what makes a custom yacht, citing "a builder’s willingness to substantially customize individual projects, particularly their willingness to move bulkheads and install owner-specified equipment." Although it allowed more boats to be considered custom, it wasn’t an accurate presentation of what constitutes a custom build.

We judge by what we think are more accurate criteria. We count the projects on which a builder will not only move bulkheads but also alter the superstructure and the waterline (especially on fiberglass projects coming from the same mold), and install owner-selected engines.

For updates to this year’s order book or to make submissions for GOB 2008, please e-mail orderbook@showboats.com.