About three weeks ago, I told you about a report from Ocean Independence stating that there were a record number of price reductions on the yacht-sales market during April. This was a significant development being announced mid-summer, because it could indicate that the yachting industry as a whole is entering another difficult phase in the continuing global recession.
Now comes word from Fraser Yachts Worldwide that it is seeing similar slowdowns in yacht sales as well as continued pressure on yacht charter rates. Fraser’s current newsletter states: “2012 is turning into a turbulent year with a dramatic decrease in the number of yachts sold in recent months. The charter market is still relatively slow for the peak season with lots of clients demanding discounts before they commit.”
In terms of yacht sales, Fraser’s newsletter states that in May, only half as many yachts were sold as during the same time last year. For June, the number dropped below half. Taken in tandem with the Ocean Independence report, this means that spring and early summer saw three consecutive months of the yacht-sales market struggling in a noteworthy way. Any regular reader of this blog also knows the same time period has brought a steady stream of charter deals and discounts being offered during what is usually the industry’s peak season of demand.
Fraser’s newsletter further states that the number of charter bookings are similar to last year at this time, but with heavy continued negotiation on rates. The newsletter also states that Italy’s newly imposed VAT rules and reporting rules for cash onboard are driving charter clients away. The company is receiving requests for itineraries in France and the Adriatic to avoid any possible altercations with the Italian authorities.
It will be interesting to see how the upcoming U.S. elections and Eurozone bank efforts affect brokerage and charter sales going into the fall and winter for 2012. For now, it appears safe to say that the yachting industry is continuing to struggle along with so many other industries worldwide.