Foggia identified that US yards are facing one key difficulty: while American clients are happy to look further afield at European yards, the same cannot be said for European clients who stay within their geographical net.
Clients are approaching yards with set prices and choosing a yard based on pedigree rather than competitive pricing. According to Foggia, clients “decide on a yard based on what they can get for their buck”. Effectively, yards are competing on quality and not price and quality extends to efficiency.
Foggia also feels the problems with the resale market are not impinging on the prospects of the new build market. Like other prominent figures in the US market, he feels that those who remain in yachting are there because they are really passionate about the discipline. In Foggia’s view, this means they are prepared to commission a new build, knowing that it allows them three or four years to use and offload their current vessel. “They’re tired of their old boat but they still have pride in what they own, compared to what else is out there”, he explains. “And refit is no walk in the park and even after an extensive refit, you’ve still got an old boat and it’s cost you almost as much as a new build.”
Is there a need to push this ‘commission now and enjoy your yacht in the meantime’ mentality? Well yes, and it’s the job of brokers to seize the opportunity says Foggia. “They’ve been doing a really good job and, even though the resale is the quicker buck, the long [established] brokerage houses see the need to get some new product on the market.”
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