The impact of the Economic crisis in the West on the worldwide yachting market
Originally, following on from the US subprime crisis we had founded our concept of offering to Asians, who were not being affected by a similar crisis in their own respective countries, the possibility of taking advantage of the high number of sale down and re-possessions of assets occurring in the West. Just as previously the West had taken advantage of the depressed markets in Asia during the 1997 Asian Crisis, this time around Asians themselves could take advantage of the crisis unfolding in the West.
Initially we had not expected the crisis in the West to last more than 2 to 3 years. However, the slowdown and crisis in Western economies has persisted largely unabated with the market for yachts being one of the first victims to suffer in a downward spiral that shows little sign of recovery anytime soon.
Growth in Western countries remains very low. The indebtedness of the States led the Governments to exercise an increased tax pressure on the wealthy people and to chase by any means tax evasion. It started by chasing the external signs of wealth amongst which the ownership of a yacht come first.
Do you know that in Italy for instance, 44% of the 40 000 luxury boats owners filed a tax return with an alleged yearly income of less than 22 000 Euros i.e. about 30000 USD ? When you relate this range of income with the purchase price of a yacht and its maintenance costs you notice obviously that something is wrong!
Therefore the first priority of most of the Governments, in their income hunting and their political obligation of justice between the tax payers has been and continue to be the targeting of yacht owners.
Added to the already huge maintenance costs of yachts in Europe in particular, this situation and the measures taken by the politicians have dramatically affected the yacht market.
On the first hand market, you may know that a number of reputable yards have moved from one recovery plan to another over the past years, two major Yards, Ferreti (Italian Yard) and Sunseeker (British Yard) having been eventually purchased in 2012 and 2013 respectively by two Chinese Companies. More than mere acquisitions: those deals are highly emblematic and precursor of how and where the future of the Yachting industry in the next few years will evolve.
In the pre-owned market, the crisis, although not as visible, is even deeper. Even the various statistics on the increasing delays and rising stocks of yachts in the West give an imperfect view on the reality of the situation. Only a continual frequenting of pontoons and marinas, a daily observation of the market, successive negotiations and deal making allow one to truly measure and take full advantage of the impact of the crisis in the yacht market in the West. This is what we are all about, and do best at Yachts Asia Buyers.