The Market Report 2021

By Sue Grant

As I sit down preparing to write the 2021 Market Report, with a blank page on the screen in front of me, I smile as I re-read last year’s iteration in which I said that 2019 really was the year that was! In January 2021, we see that we were but limbering up for the main event, 2020, the year that we have all just turned the page on, with some relief!

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We have had natural disasters aplenty, together with an election in the United States which will probably go down as the most impolite and grumpy in history and, of course; the UK finally left the EU with a trade deal negotiated and agreed on Christmas Eve, with the Queen’s Flight ferrying the bound document of more than 120,000 pages from Brussels, to London and then back again. This is without even considering the social and political unrest around the globe, with evidence aplenty of the legion of ecological problems and challenges that face the human race.

However, overshadowing all the extraordinary events, like an enormous and rather unfriendly fire breathing dragon in the room, has been COVID-19, a global pandemic whose fiery breath expanded from Wuhan to every part of the planet. As I write, the UK is in virtual lockdown and our offices in France, Spain, Sweden and USA are in a similar predicament. Of course the cavalry can be seen on a far off ridge bearing vaccines to slay the dragon, and to hopefully return the world to something resembling normality, we hope very soon, but suspect later in the year for most.

2020 started to go downhill for us during the first lockdown in March. The UK office went home but continued to work, using Teams, Discord, Zoom and all that good stuff. Our overseas offices were starting to see the effects too and it was a sombre moment for us all. We wondered what would happen to a bunch of yacht brokers, working in garden sheds, on kitchen tables and in garages and to the yacht market which for sure would freeze up – just like the flight scheduling of Easy Jet! The reality of the suffering and death that has touched us all, continues today, as COVID intervenes at every level of life.

However, it has always been our view that the only thing to do in a crisis is to Keep Calm and Carry On!, and so that is exactly what we did. After stabilising the deals that we had in play, completing some, putting others on ice and trying to ensure that they would close when things improved, we settled down to look at what we would do next. Infrequent visits to Berthon were eerie, with 130 people from the Shipyard on furlough, and no clients or yachts moving in the marina – all very bizarre.

We got going with international meetings every week with everyone from all offices on Discord sharing experiences and discussing the future and how we could be better, do more and be a tighter team. These meetings continue today, and have been key in welding us together as a cohesive team with a common purpose – more of a family as we are fond of saying – than ever before.

We unwrapped our marketing and took a good look at it. We cleaned up our act here – as a team – rebranding ourselves as the Berthon Sales Group. Importantly, we took the time to build a new website. With very little business coming in, and recognising that the darkest hour is always before the dawn, we invested in a future that didn’t look at all clear.

We looked at training and did all those improvement courses that you talk about and don’t bother with. We upgraded our social media offering and we started to toil together on this as a team to make this work for us.

We were very busy in a new way, exchanging ideas and spending time on the hidden, backroom stuff that is normally not mission critical to the main objective of negotiating and closing deals.

On new yacht sales, we managed to deliver all the yachts that we had on order – Windy, Pearl, Moody, Rustler and Solaris, working with our brilliant build partners to get this done. Owners were objective and practical and helped us to achieve this, understanding the difficulties but still excited about taking delivery of their new yachts that would give them relief from CV19 and something for them and their families to look forward to.

During the first lockdown we also did something else which was super important. We talked to, emailed, messaged and engaged with our clients.

It was great to be in touch with them, and it quickly became apparent that their commitment and appetite for all things yachting was in no way diminished. Because our whole sales team worked throughout the year, we were able to maintain a very firm finger on the pulse of the market and to know what was going on, which I think was crucial to our success. The team worked their hearts out all year. ❤ Well done to all of them.

We all became used to hearing about the financial Armageddon that was around the corner, but somehow this didn’t seem to affect our market and the desire to get out on the water as soon as possible, even if restrictions and location difficulties meant that this was more problematic.

The summer was huge for yacht sales across the planet. Yachts flew out of the door, both new and second hand. We are very used to monitoring segments of the market to see what is hot and what is frankly rather chill. However, in the summer, autumn and winter of 2020 – there were no chilly segments, and everything achieved good levels of interest. The only stickers were those in the too difficult to deal with pile where location and other factors meant that we do really have to return to normal before a deal can properly be struck.

This trend continues and the yachting world is looking forward hugely to the new season in 2021 as are we.

During the summer, we all learnt more about COVID-19 and what we could do to make our people and our clients safe. Desks grew screens, Berthon Spain came up with some natty Berthon masks, protocols for showing yachts and conducting yacht sales were established and of course we are using these today, as well as COVID testing. The Berthon Shipyard again was a hive of activity with a big pipeline of refit work and the marina started to hum as well.

Being nimble to manage changing circumstances has always been something that Berthon has done well. We realised that the standard yacht sale processes wouldn’t work. We have now become sanguine about FaceTime viewings, are videoing whenever possible and in 2020 have transacted a number of yachts to people that we have never met, of yachts that they have never seen live. In one case shipping from the USA to Germany – the first time the new owner saw the yacht was when she was lifted off the ship and into the chill of the North European waters destined to be her new home.

There is never a good or bad time to develop your business and we took some decisions that seemed very brave at the time. The most scary, but a no brainer now, was the new website. The next was continuing investment in Berthon Scandinavia.

Magnus and the team in Sweden beat all the odds in 2020. A super busy year for the team led us to recruit an extra member, Fredik Sundberg joined Magnus, Bo and Birgitta last Autumn. From a low base line, the office made sales and was in black this year with so much more to do next year and we are so proud to have them on the team.

At Berthon Spain we also had some huge changes this year. Simon Turner, a great friend of Berthon who worked in the UK office many years ago before moving to Palma to Nautor Spain and then to Berthon Spain, before forming Northrop & Johnson Palma, came home to Berthon. This was a huge thrill for us all, and for me in particular – he is an old and much trusted friend. So we now have a new sales office opposite the Club de Mar. Also very exciting was the move by Ben Toogood, our brand manager for Windy and Pearl in the UK to Palma, where he joins Simon.

As if that wasn’t enough, Berthon Spain is now ensconced in an enormous refit and repair shed of 2,000 square metres, enabling us to scale this business substantially. Andrew Fairbrass who runs Berthon Spain has had a VERY big year.

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The personnel changes enabled us to move things around in the UK with Hugh Rayner, our fantastic motor yacht broker, moving to Windy and Pearl.

With 2 x Pearl 62s sold and a number of Windys already, his enthusiasm is infectious. On motor yacht brokerage sales we have Robert Steadman and Harry Hamson both of whom live, breath and rarely talk about anything other than motor yachts, listing yachts from afar and selling them on with gusto!

In the USA it was another stellar year. Moody yachts sold like hot cakes and the brokerage market was super busy. The team in the USA are very experienced on the donation process and this was again good for us.

France delivered yachts and managed to fight through the restrictions, and once open again the Côte d’Azur will be the international playground for those who love its cerulean sea waters and rather excellent cuisine.

Boat Shows were interesting in 2020. Many were cancelled early, whilst others took us to the wire like the Southampton Boat Show – cancelled the evening before preview day. Not great and a waste of resource, but we dug deep, moved our yachts, kept appointments and sold yachts! Cannes was the next blow and of course Boot Düsseldorf 2021 was scratched. A lot has been talked about the death of Boat Shows. This is of course rubbish, and whilst virtual boat shows and webinars are all very well, with the slaying of the COVID dragon, we will see the return of the boat show, albeit maybe in more manageable formats. The organisers will need to dig deep to make the format work for both exhibitors and the public.

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VAT on yachts after Brexit has been a ticking time bomb for some time and the confused messages put out by HMRC are still causing fall out. Essentially, UK owned yachts in the UK are UK VAT paid and have Temporary Arrangements in the EU when they visit. As this means that a UK client cruising in Europe no longer has to pay VAT, this seems to us to be a huge plus for many. Of course with this comes Schengen rules with the rolling restriction of 90/180 days. The rules and rows around what is VAT paid when and how will rumble on for the coming months and years; needless to say, we expand further on this later in the publication.

In amongst the COVID battle, Brexit became a local skirmish reaching only news item 4 on the BBC news when the deal was struck on Christmas Eve. Whatever your view of Brexit, it is good that it is settled and now we have the drudgery of making it work. In retrospect, few people (particularly Brits) had the bandwidth to worry too much about Brexit and not having it headlined every day, was a blessed, but small relief. The new protocols for RCD are but a pin prick on our list of issues in this brave new world.

So, 2020 – what a year! The whole team has grabbed a few days of R&R (although not that too much of the second R is available currently) after a simply huge year, in which we have pushed the envelope, achieved much and have been, in so many ways incredibly lucky. With a stronger marketing proposition, sturdier and more united team, 2 new offices and a massive shed in Palma we have much to build on in 2021. We will be working hard to do this, whilst observing all COVID regulations and keeping our people and our clients safe. A huge thank you to my incredible team, and also to our client base without whom, none of this would have been possible.

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