COVID-19 and the Yacht Market

By Sue Grant

Every working day excluding weekends and bank holidays, since Boris Johnson asked us all to go home and stay there, I have recorded the days since the Covid-19 crisis began. Today they number 615.

Today I wrote the number six hundred and fifteen, in the Day Book that I have kept ever since I began working at Berthon, in the days when a telex glowered in the corner of an office and we sent faxes and letters!

Covid, like the Greek & Roman Lernaean Hydra (a many-headed water serpent), has intruded into every part of life and things will never again be quite the same. It has changed the attitude and behaviour of the human race and shown how fragile our freedoms and way of life really are.

In the same way that we have all learned from the Far East to wear face masks, to prod ourselves in the back of the throat and nose at every opportunity and to report our results online, to wash our hands continuously and most difficult of all, fill in the dreaded Passenger Locator Forms and other paperwork for international travel, whose complexity make the Times crossword pale into insignificance, yachting has also seen fundamental operational changes as a result of the serpent.

You will have read of purchases on line, virtual viewings, frightening amounts of paperwork in order to move yachts, quarantine, and in the case of the Southern Hemisphere, whole swathes of cruising grounds that shut to visiting yachtsmen. For those living in these waters, the problems have been reversed as they cannot leave, cannot buy a yacht outside the home market and all in all Ground Hog Day in many respects has been with us for almost exactly six hundred and fifteen…

At Berthon we adopt the glass half-full approach and so it seems do our client base. In a world riddled with uncertainty, the main certainty of 2021 was that our clients wanted to get out on the water and dive into all that means and delivers. A lot has been written about the need to have a safe place for family and friends and, indubitably, a yacht provides this – a floating castle that can move.

However, we think that it’s much more than this. In the UK at least, we had a lot of weather last summer. Most of it very wet, and much of it horizontal. Despite this, the marinas in UK, Europe, the USA and elsewhere were absolutely full to the brim. When a client in Newport RI, USA took delivery of his new Moody 54ʼ from us, he had to dry sail her (yes really)!

Covid-19 has provided the backdrop to plenty of tragedy. Lives cut short, pain, suffering, loss of livelihood and the fracture of family and peer groups as we are all enjoined to maintain a 2 metre distance, be very careful about even considering doing anything remotely fun (Number 10 staff excluded!). Businesses have failed, busy town centres have started to resemble the set of Coronation Street (Britain’s longest soap opera!) and our doctors, nurses and carers internationally were at it flat out.

Amongst all this, we have also seen nimble businesses change tack and make money out of the changing world, and we have seen a change in attitude with working from home, and taking what opportunities there are to enjoy life becoming more important than ever before. This step change, heralded by the great resignation, which has seen so many people re-assess their lives, change their direction, job, where they live and how they do so.

Yachting has benefited from the change in attitude, which started with the possibilities of being safe aboard a yacht with your nearest and dearest and has morphed into something much more fundamental.

The human condition is much improved in an environment of freedom and self-determination. And, what could provide more freedom than owning and operating your own yacht which is totally under your control? Rather than being answerable to Government restrictions and detailed rules about how to wear a face mask or fill in a form, when to take a jab or if the PCR results will ever turn up, more palatable are the restrictions imposed by the tide, winds, currents and the limitations of the kit aboard your magic carpet of choice.

All so much better than a house in the country, as this one will move. There are limitations to some degree in where you go (not too onerous if you don’t mind the quarantine) but despite Covid, 71% of the earth’s surface is still covered with water and that provides really quite a lot of scope for getting away from it all and enjoying life, well lived, at sea or on its peripheries.

Whilst freedom is a fundamental requirement for human contentment, something else that is key is the need to explore, do new things and to drink deeply of the experiences and possibilities of the natural world. Pre-Covid, too many people rushed around ant-like, working hard in business and trying to hit financial milestones before the life of adventure began.

Getting on for 6 million people have sadly died from the Covid-19 serpent. That’s quite a number. It certainly focuses the mind and for yachting it has meant that many a yachtsman with a yacht, hankering to upgrade and do more cruising; or, those who haven’t bought at all because of lack of time caused by the treadmill of the office, have reassessed life and brought forward their plans for a big trip or for spending more time on the water.

One of the interesting things for us are those who are moving up – but not to cross an ocean, sail an extraordinary regatta (sans beer tent of course) or doing a big project. Many have moved up with modest ambitions as to their usage and cruising programme, but with big plans to spend a lot more time aboard. There is nothing not to like about 6 months a year locally cruising and venturing to the sun. You don’t have to thrash across an ocean or oceans or to buy in dozens of survival suits in the quest for white water. You can change your life significantly in small increments – spending more time aboard, doing more overnight trips (or not), expanding slightly your cruising area and for sure spending lots more days just messing about on the yacht.

This shift of mindset across the board has been a shot in the arm for the yachting industry and has seen us running hard to deliver on our client’s expectation against a backdrop of supply chain difficulties and all sorts of booby traps caused by Covid rules (and some may even have had something to do with Brexit!). In addition to the current client base stepping it up, we have seen a lot of new entrants to the sport.

Whereas in recent years there has been a decline in interest in sailing, with motor yachts dominating production and sales in all segments, we are now seeing new sailors keen to let the breeze take the strain and keen to learn the secrets of sail propulsion. These new entrants are across the demographic but they are united in a desire to enjoy the freedom of the sea and to learn the crafts of sailing, yacht handling, navigation and all the rest.

This desire has rippled upwards with the super and mega yacht segment under pressure to deliver on the new demand.

We are hoping that a happy result of Covid-19 will be that these new entrants and more heavily invested existing yachtsmen will continue to love their yachts and will want to do yet more. That their friends and families will also get it and so the expansion of our industry will see more clients getting out there and loving the yachting life.

In the same way as lock down taught us the painful value of Pelaton and how to do imaginative things with cheese sauce and vegetables, modern technology that is kinder to the environment is becoming more important in our world. Whilst the technology isn’t yet quite there, we predict that electric drive is coming and the technology around lithium ion and the rest is evolving fast and will be key to the development of new yachts in the future, subject to appropriate fire risk assessments.

This is very evident in yachting and increasingly people are not only using their yachts more, but they are keen to understand and be part of the drive for greener technology in yachts and this trend will not change we feel.

The frenzy of activity in the market, and plenty of forward orders for new yachts, shows no sign of abating so far in 2022. Understandably, it will be a different year as many of the builders are showing long lead times, price hikes as inflation starts to bite and struggles with the supply chain problems that were an issue throughout 2021. This means that as the pressure comes on, people will be focussing on buying pre-owned yachts as they come to the market.

Over time this will all settle down and the market will adjust to a new normal which will be busier than where we started in 2019 and more innovative and with more clients much more invested in yachting and prepared to spend more time aboard their yachts. Good news for us, as in this way they are getting value out of their investment.

We are also seeing fundamental changes in the infrastructure around yachting – more custom built construction factories rather than manufacturing production line yards (although, some of the latter have a myriad of clever layouts that come close to bespoke purchases). Yachts stored in stacks, at least for smaller motor yachts, and perpetually dry-sailed. People diving into the possibilities of keeping their yachts far away and visiting them for longer periods. For UK clients, this is a double edged sword – being outside the EU means that they can keep an ex-VAT yacht in the EU or a TA arrangement for 18 months which can be perpetually renewed provided that they leave Europe every 18 months for a port outside the EU, touch and return. The other side of the coin is the spectre of the Schengen rules and the 90 day restriction in every 180 days. However, VISAs and Cartes de Séjour at present appear to offer a fudge.

Thankfully, it seems that Omicron is morphing into a mild variant and we hope that soon Covid will be just another bug. However, what it leaves behind it is much more fundamental in all our lives and in yachting too.

Photo credit © Onne van der Wal

Maybe we are a microcosm of what has happened the world over but it has been an exciting and special time, tinged with worry about the health and wellbeing of colleagues and loved ones. It has been an extraordinary journey and not like any stretch of water that the Berthon Sales Group Ship has had to navigate before, with plenty of uncharted rocks and lee shores, but also scattered around were some spectacular anchorages and epic passages.

As we get stuck into 2022 and all that this new year will bring, it is a time to count our blessings and to thank our clients for their enthusiasm for supporting this great sport. The growth in sales and the developments that we have seen across our industry in 2021 provides a platform for more time afloat and yet more modern development of the products on offer.

We have now hopefully arrived at a life beyond Covid, rather than living a life with Covid; we are all enjoying those little every day freedoms that mean so much and seem so small. Yachting will be fundamentally changed and as a business we will have changed fundamentally too.

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