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Jun
2015

Luxury yachts & Private jets March 2014

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The yacht industry continues to expand

Increased investment

In 2013 the Chinese yacht market had expanded and was no longer dominated by foreign brands but also domestic brands. A greater volume of joint-venture capital started to be invested in the yacht industry and this trend is expected to continue in 2014.

The economic growth of the boating sector has been approved at all levels of society, demonstrated by several large mergers and acquisitions and Chinese enterprises acquiring overseas brands is becoming a trend.

In the mean time the international yacht industry will continue to monitor the Chinese market, not only in their efforts to localise their brand, but also for more flexible forms of cooperation such as joint capital partnerships in manufacturing, sales, operations and other marine projects. This in turn will also increase enthusiasm and boost private investment in the yacht industry, and make yacht club memberships or berths popular and a sound investment.

Inter-regional sailing

The plans for the Guangdong, Hong Kong and Macau yacht ‘Free travel programme’ which allows a boat registered in once place to freely travel to the others was a hot button for the industry in 2013. Several cities in Guangdong such as Shenzhen, Zhongshan, Dongguan and Zhuhai have done a lot of work to support and encourage these regulations aiming to be the first cities to establish a similar programme in The Pearl River Delta Area. Their yacht management policy has attracted central governmental ministry attention, and although the implementation has yet to commence, all the key objectives have been agreed and it is expected to be only a matter of time before they are executed. So perhaps in 2014, yachts in Hong Kong and Macao will be like cars, using a registration number that allows them to move between cities. We must wait and see?

Public marinas increase

Public marinas and berths have been a regular topic of discussion within the boating industry. In 2013, public marina projects in many areas moved from pure planning ideas to construction commenting. Public marina space without the need for membership fees, will provide yacht owners the option of berth leasing services, access to electricity and water supplies, sewage disposal, biodegradable boat washes etc. They may also carry out maintenance and repair work or other paid services ashore. The industry sees that public marina’s, will help to reduce the overall costs of boat ownership that will directly promote water sports and other activities and so develop the wider industry.

Tax policy loosens

Currently, taxes levied on imported yachts including import duties, special consumption tax and value added tax, total about 44% of the CIF value of the yacht. Even domestic made boats have a special consumption tax applied to them. According to some industry experts, the high tax levied may have a negative impact on the healthy development of the sector. However, the continued efforts of the yacht industry association has not been ignored by the government, and apparently these taxes may be adjusted in future. Possible adjustments in tax may refer to a scale based on the different levels of boat, lengths, displacements etc. hopefully promoting the development of the mass yacht market.

Requirements for environmental protection

Other than luxury yachts, boats used for tourism, vacations and rental services create a high drive for energy conservation. Improved energy performance can be very important for private yachts, impacting daily ownership costs and may determine whether a purchase is made or not. Emissions in terms of noise are also a challenge on scenic rivers and lakes. So to fit the trend of social development in China, boat manufacturers are now having to consider energy saving and environmental protection requirements.
The popularity of sailing is driven by racing

In 2013 the most noteworthy yacht race was the ‘China Cup’ that proved a great success. After years of effort, the ‘China Cup’ has become more than a race but a complex competitive sport, business, culture, art, fashion and charity carnival of the ocean and over 40,000 spectators watched the last event. In coastal areas, sailing courses will begin to start and are likely to become widely enjoyed by many young Chinese people.

Yacht leisure

In some Chinese coastal cities, boating elevates the level of local tourism, and it is expected that yacht-themed resorts will soon start to appear. Boating companies have begun to become involved in the construction of tourist resort areas that contain many boat-related recreational services and facilities, such as breakwaters, public beaches, green spaces, hotels, golf courses, vacation homes, marinas, and of course yacht clubs. These large yacht vacation complex’s will enhance the seaside tourist attractions in China and provide better maritime services and high-end leisure to consumers.

The rapid rise of fishing activities

Coastal fishing has become a very popular leisure activity. Currently, there are a large-scale coastal fishing enthusiast groups and many Chinese coastal and lake area fishing tournaments are organized. Amongst the local governments there is a repeated aim to develop the marine economy, and ‘recreational fishing’ has often been mentioned. Although a yacht is new and mysterious thing to the Chinese, coastal fishing may be the reason for many people make first contact with boating.

As the fishing market prospects as looking promising, domestic boat manufacturers have developed products to meet demand for a more advanced, secure, and efficient fishing vessels. It maybe that in the future, there will be more boat manufacturers and operators that will regard coastal fishing as an important market segment which will promote the design of functional fishing boats and the services of boat rental.

Licensed and regulated staff

Obtaining a motor or sailboat license is prerequisite for any employee who wants to be a yachtsman in any of yacht clubs in the country. In boat sales, maintenance and other relative aspects, the lack of professional staff is still an inevitable issue and one that needs to be addressed. The government has discussed the desire to establish a yacht broker and boat maintenance vocational qualification to develop the industry and detailed regulations may be announced in 2014.

Clubs do operate joint training programmes that have opened up new avenues to meet the demands of professional boating employees, and we can expect that in future the development of the boating sector will enable industry employees to become increasingly more professionalized.


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