Struggles with Brazilian yard operations
The project manager of a 41m new-build, and ex-superyacht captain, contacted us to share his story of the lengthy yard processes in Brazil, with a view to helping captains better understand the process.…
Ex-superyacht captain and General Manager at Global Explorer Yachts recently contacted The Crew Report concerning problems leaving a Brazilian shipyard. Wishing better inform and educate captains who may be thinking of visiting Brazil in the future, particularly those visiting for the Rio 2016 Olympics and planning to have maintenance done at the same time, Darren Nightingale shared his story with The Crew Report.
Not long ago, Global Explorer Yachts was working on the build of a 41m motoryacht, also known as hull 568. The yacht’s steel hull and aluminum superstructure were built in Brazil to take advantage of the cheaper labour rates, with a view to then move to French shipyard JFA for the yacht’s fit-out and completion, to ensure the yacht has a European fit and finish.
Working in the capacity as project manager, Nightingale first ran into problems when it was desired the yacht leave Brazil to undertake the latter stages of the project. “The bureaucracy in Brazil is a major project in itself. For example, it took around twelve months to receive our visas after all paperwork had been submitted, whilst all the time being told they should be ready in the coming weeks, explains Nightingale.
“The government changed the laws as to how long equipment for export can stay in the country duty-free before you must pay one hundred per cent tax on it. Considering everything on a yacht is important, this can add up to an unacceptable cost to the project.”
Time-scales were also a problem, even leaving finances out of the equation, adds Nightingale. “Equipment coming in through their customs process can either take thirty days or eighteen months and there is no indication as to which piece of equipment will get stuck or why. This makes it very difficult form a planning and equipment purchasing perspective. For example, we had received the engines and generator after three months in customs, but it took twelve months to receive the mounts, so neither could be installed.”
However, the Brazilian quality of work involved in constructing the yacht’s hull, superstructure, accommodation piping and electrical cirtuits, once it was able to begin, was excellent, adds Nightingale. “The vessel is to be a world cruising ocean-going explorer yacht, and as such it is all over engineered. This is how they build their commercial vessels, both naval and petrochemical, which is a good foundation for the potentially tough conditions which are sure to arise.”
Moreover, the shipyard proved very helpful when it came to the many hurdles this particular project encountered. “Our relationship with the shipyard who constructed the hull and superstructure is very good. They were instrumental in helping us navigate through the government roadblocks and still provide support today in regards to drawings, class sand any other queries we may have.”
Like with London 2012, Rio 2016 has the potential to host a number of superyachts, so what advice would Nightingale give to captains planning to visit Brazil? “Travel to the location first to get an idea of the process involved to remain there in a professional capacity. Engage an immigration lawyer to give you your options if the shipyard does not have access to one, and organise your visas well in advance of beginning a project in Brazil. You may need to order your equipment more than twelve months ahead of when you want to install it, and it may be another twelve months before this is commissioned. Relay this information onto the suppliers so they can prepare it for lengthy storage.”
But it’s not just the 2016 Olympics that make the destination attractive for superyachts. “Seeing as Brazil is about 3500 to 5000 nautical miles from the Miami area, the fuel costs getting there are high. It would make financial sense if you were returning from a trip to Antarctica or around the Horn and on your way past. You must do your homework first, though, to make sure that where you are going can carry out the work you require.”
Not long ago, Global Explorer Yachts was working on the build of a 41m motoryacht, also known as hull 568. The yacht’s steel hull and aluminum superstructure were built in Brazil to take advantage of the cheaper labour rates, with a view to then move to French shipyard JFA for the yacht’s fit-out and completion, to ensure the yacht has a European fit and finish.
The superyacht in question - severely delayed due to the Brazilian processes
Working in the capacity as project manager, Nightingale first ran into problems when it was desired the yacht leave Brazil to undertake the latter stages of the project. “The bureaucracy in Brazil is a major project in itself. For example, it took around twelve months to receive our visas after all paperwork had been submitted, whilst all the time being told they should be ready in the coming weeks, explains Nightingale.
“The government changed the laws as to how long equipment for export can stay in the country duty-free before you must pay one hundred per cent tax on it. Considering everything on a yacht is important, this can add up to an unacceptable cost to the project.”
Time-scales were also a problem, even leaving finances out of the equation, adds Nightingale. “Equipment coming in through their customs process can either take thirty days or eighteen months and there is no indication as to which piece of equipment will get stuck or why. This makes it very difficult form a planning and equipment purchasing perspective. For example, we had received the engines and generator after three months in customs, but it took twelve months to receive the mounts, so neither could be installed.”
"You may need to order your equipment more than twelve months ahead of when you want to install it, and it may be another twelve months before this is commissioned."
However, the Brazilian quality of work involved in constructing the yacht’s hull, superstructure, accommodation piping and electrical cirtuits, once it was able to begin, was excellent, adds Nightingale. “The vessel is to be a world cruising ocean-going explorer yacht, and as such it is all over engineered. This is how they build their commercial vessels, both naval and petrochemical, which is a good foundation for the potentially tough conditions which are sure to arise.”
Moreover, the shipyard proved very helpful when it came to the many hurdles this particular project encountered. “Our relationship with the shipyard who constructed the hull and superstructure is very good. They were instrumental in helping us navigate through the government roadblocks and still provide support today in regards to drawings, class sand any other queries we may have.”
The yacht is now at France's JFA yard for completion
Like with London 2012, Rio 2016 has the potential to host a number of superyachts, so what advice would Nightingale give to captains planning to visit Brazil? “Travel to the location first to get an idea of the process involved to remain there in a professional capacity. Engage an immigration lawyer to give you your options if the shipyard does not have access to one, and organise your visas well in advance of beginning a project in Brazil. You may need to order your equipment more than twelve months ahead of when you want to install it, and it may be another twelve months before this is commissioned. Relay this information onto the suppliers so they can prepare it for lengthy storage.”
But it’s not just the 2016 Olympics that make the destination attractive for superyachts. “Seeing as Brazil is about 3500 to 5000 nautical miles from the Miami area, the fuel costs getting there are high. It would make financial sense if you were returning from a trip to Antarctica or around the Horn and on your way past. You must do your homework first, though, to make sure that where you are going can carry out the work you require.”
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