Rise in billionaires leads to rise in luxury yacht ownership
The fastest growing portion of the Ultra High Net Worth individuals (UHNW) elite is the billionaire class, which should be good news for luxury yacht sales, as this sector is most likely to invest in a superyacht. An additional 600 vessels are expected to be commissioned by the end of 2020. The threshold to attain UHNW status is $30m, and the average price for a luxury yacht resale is $10m with another 10% of cost per annum towards running it.
A report by Wealth-X and Camper and Nicholson identified strong emerging billionaire markets in Germany, Japan and China. It looked at ways to make these wealthy countries more interested in attaining luxury yachts, with current ownership disproportionately low. Ownership is strongly concentrated in the US, UK, Australia, Italy and Russia. The challenge for the industry is to reach out to the new legions of billionaires and persuade them of the many benefits and advantages of boats.
Prime among these is the major opportunity for near complete privacy. This is crucial for many of the super rich. They want to be able to tie up in well-known and busy ports yet retain a certain amount of anonymity. A luxury yacht allows this with Michelin-star standard fine dining on board.
Access to unique and otherwise unreachable locations is part of the appeal. The fast-growing UHNW segment values experiences and appreciates that remote locations can bring them both excitement and security. With amenities and staff on board that allow them to keep up their health and wellness routines, the wealthy can be convinced that a luxury yacht is every bit as rewarding as a stay in a prestigious hotel. Built-in features such as cinemas and jacuzzis, and water-toys such as jet skis, all enhance the joys of yachting.
Clients who possess the means of purchase, yet who consider themselves not to be interested in boats, are a key target for convincing that a luxury yacht could be the answer to many of their desires. A bespoke means to travel, a place to exhibit an art collection, a world-class dining venue, around-the-clock service and that all-important privacy are major selling points. As more and more billionaires become converts and take to the seas, expect to see a major boom in the luxury yacht industry.