2019 Global Order Book
The positive mood that has been evident at boat shows in recent years has had a visible impact on the 2019 Global Order Book, with 57 more projects reported over the past year. Some 830 superyachts measuring 24m or more are under construction or on order with hull numbers and/or deposits at shipyards around the world. In total, the projects represent a length of 32.7km (up 3.7 per cent) but with a shorter average vessel size of 39.39m compared to last year (down three per cent). Once again, the Italian builders Azimut-Benetti, Ferretti Group and Sanlorenzo fill the top three positions in the same order as last year.
Projects by length, 13 year comparison
The majority of the countries where large yacht building takes place have more projects under construction, which is a positive sign. This is especially the case for the duo at the top of the pyramid, Italy and the Netherlands, which collectively have seen a 9.5 per cent increase in orders over 2017.
It’s not all good news, though. Turkey, in fourth place, has seen its orders dip. As too has China, where deliveries have outpaced new orders, and the US, where the number of superyachts on order or started on speculation has continued on a downward trajectory since 2010 (down 67 per cent). In general, US yards tend to be far more cautious about starting builds on speculation than their European counterparts. The only other countries to see a decline in the number of superyachts in build or ordered are Australia, Norway and Greece, but we’re dealing with such small numbers (two, three and two superyachts respectively) that it’s hard to draw any firm conclusions.
The UK has leapt to third place in the global rankings (up from fifth last year) for total length of superyachts under construction or on order, thanks in large part to an impressive order book shared personally by Antony Sheriff, executive chairman of Princess Yachts.
In the collective gross tonnage stakes, Italy leads again, but the Netherlands has overtaken Germany thanks to an uptick in orders of large volume projects. But, as every year, the difference is stark when you average the total gross tonnage over the number of projects. Italy’s total gross tonnage of superyachts in build or on order of 135,434 is spread over 379 projects (average approximately 357GT), while Germany records only 16 yachts in build or on order at an average gross tonnage of 5,400GT. The average gross tonnage for yachts in build in the Netherlands is 1,302GT. Norway’s three projects in build accelerate it into fifth place, as they have a huge average gross tonnage of 8,313GT.
Top 20 builders by length
The busiest builders by total length of projects remain largely unchanged, although we welcome a new entry into the Top 20 this year with Palumbo. This group now counts ISA Yachts and Columbus Yachts within its structure, and joins the list at 14 thanks in part to the success of ISA’s Extra 86, 93 and 126 models.
The top three all revealed an increase in production over the past year, in terms of number of hulls in build or on order and their combined length. For Azimut-Benetti, the acceleration is most pronounced, with 97 hulls in build or on order (up from 77), largely thanks to the Azimut side of the business. Ferretti Group, with its stable of brands, reports an increase in order numbers to 91 (up from 87 in 2017) and a jump in total length to 2,952m, up from 2,762m. Sanlorenzo’s performance is impressive as it’s a single-brand company, whereas Azimut-Benetti and Ferretti Group combine the totals for all the yards they control. The company has 77 Sanlorenzos under construction or on order (up from 71), making it the busiest single-brand yard in the world.
The UK’s Princess Yachts now ranks in fourth place. Some of its new models are already sold as far out as 2020. The British yard builds more smaller production and semi-custom yachts than others in the Top 10, but the figures revealed remain impressive as the company reaps the rewards of refreshing its range, and the early success of models like the Y85 (to debut at Düsseldorf in 2019) and X95. The introduction of new semi-custom models is an emerging market trend.
Feadship sits in fifth place with no fewer than 18 projects under construction (up from 15), with a total length of 1,380m (up from 1,187m). This is to be expected given the extra capacity the company has coming online at a large new shed in Amsterdam that can build yachts up to 160m. Lürssen’s position remains strong, even after the fire in September 2018 that destroyed the 145m Project Sassi. Oceanco, meanwhile, is creeping up the table in terms of projects on order or under construction and their total length and gross tonnage. It jumps to 12th place, up from 17th, with five projects on order, four of which exceed 100m in length.
This year we have removed some old projects from the Global Order Book that we have previously included as “on hold”. We judged that these projects have little or no chance of short-term resumption, in total removing 24 projects for a combined length of 1,189m. We will keep tabs on them nonetheless, as some are brought back to life each year. An example is the 84m PJ World project that lay dormant in Norway for more than a decade, but eventually sold in 2018 to an ambitious owner.
This removing of long-term on-hold projects has had an impact on some size categories, which have slightly fewer projects this year, and this is especially the case in the biggest size category – 76m (250ft)-plus. We have removed four of these large projects, including, sadly, Project Sassi. However, we still recorded 48 yachts in this category, a decline of 10 per cent over last year. We have seen a flurry of 100m-plus projects delivered this year, but this biggest market has been supported by new orders and we count 19 under construction or with a deposit paid, down from 20 in 2017. Germany continues to lead this special market, with at least eight projects known including six at Lürssen and the first 100m-plus project at Abeking & Rasmussen. The Netherlands is closing the gap, however, with four 100m-plus projects at Oceanco and one at Feadship.
In the middle of the market, yachts between 37m and 75m, we have seen a small production increase of two per cent. This growth is mainly coming from more orders of yachts in the 46m to 60m range, which was heavily impacted a couple of years ago, but is now recovering.
The big driver this year is the smaller end of the market, due in part to yards’ increased investment in model development. Last year saw a positive growth in production, but this year represents a real boom. The smallest category, from 24m to 27m, has seen a jump of 16 per cent, with 228 projects on order or under construction globally, up from 182 last year and the best number since 2009. The success of Princess Yachts has played a big part, as too have models like the Azimut 27 Metri and Sanlorenzo SX88, both of which are selling well with demand outpacing production capacity.
Top builder nations by volume
Types of yacht
The large sailing yacht market continues to struggle, with just 51 projects making up the 830 superyachts in build globally. Despite increased interest in more environmentally friendly ways to enjoy the ocean, this hasn’t translated into more sailing yacht orders. There is some good news, however: more sailing yachts are changing hands on the brokerage market, with 52 selling from September 2017 to September 2018, way ahead of any figure in the previous decade. It remains to be seen if this activity will have a trickle-down effect on the new-build sector.
Orders of higher-speed open yachts (also sometimes known as sportscruisers, such as the Mangusta Maxi Open series) are on the upswing. With fuel costs not rising as high or fast as once predicted, buyers are moving into open boats in greater numbers, with 56 recorded as on order or under construction this year, compared with 39 last year. Smarter hull construction, better engine efficiency and new propulsion systems are also working to keep this bracket of boat attractive to buyers. We still admit to being a little surprised by this result, given all the talk about long-range cruising in remote locations. In fact, the number of expedition yachts recorded in this year’s GOB declined for the first time in a decade, but the 10-year trend is still strongly positive. Nearly all these projects are fully custom, unlike in the other categories, and therefore more exposed to minor shifts in interest. This niche still has some truly impressive projects, including 145m Solaris at Lloyd Werft, scheduled for 2020, or 107m Northern Star at Lürssen, scheduled for 2021, plus the new SeaXplorer series from Damen.
A large part of the GOB (44 per cent) are yachts started on speculation. This number has advanced steadily since we started recording data about spec builds in 2017; in three years it has advanced from 335 to 376. Yards are clearly banking on the impatience of the modern superyacht buyer and investing heavily in starting yachts without owners. Conversely, the number of fully custom yachts (unique projects started with owners from scratch) is on a downward march, with 241 recorded in this year’s GOB, down from 300 a decade ago. Clearly the speculative business model has been a boon to builders as diverse as Westport, Amels and Heesen and to companies such as Hargrave Custom Yachts, which doesn’t own a yard but directs production at contracted yards in Asia and Europe. For now at least, it appears that the market for spec projects is strong – as is the appetite for risk at the yards starting these hulls without owners.
This positivity is reflected by the brokerage, or second-hand market. The 12 months from October 2017 to September 2018 have seen the most business since the global financial crisis hit the superyacht industry a decade ago, with 442 sales. American owners are responsible for the largest proportion by country, about 45 per cent, while the Middle East is also seeing an improving level of brokerage buying, and Russian buyers are returning in good numbers, according to key industry figures.
The data seem to be optimistic. Sheds are full again for many shipyards, the number of active yards has stabilised and the flurry of buying up of competitors to secure diverse or vertical markets has slowed. However, the superyacht industry is not immune to shocks. A growth of speculative production increases risk. Of the 830 yachts recorded in this year’s Global Order Book, 454 were started with owners and 376 without – both figures are in advance of last year (406 and 367 respectively), but sudden and severe headwinds could seriously hurt those yards housing a lot of this speculative production. Interestingly, some yards spoken to for this report are announcing a limiting of activity to keep control over the size of their order book and quality of production. It seems like a wise move.
One other thing we have noted in recent years is the increasing corporatisation of shipyards – where the nature of boatbuilding is shifting from being a cottage industry to one dominated by large overseas owners and the need to announce profits to shareholders. Consolidation and more incoming investment is responsible, but that’s not in itself a bad thing and may speed innovation and the diversity of product offerings. This, too, is part of the shifting narrative of the Global Order Book.
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