The trials and tribulations of the United States’ new build superyacht market have been well-documented. While US owners continue to support the new build segment in Europe, the domestic market has largely been left to focus on the refit sector. SuperyachtNews.com sat down with William (Billy) S. Smith III, chief operating officer of Trinity Yachts, at FLIBS 2015 to discuss the state of the US market.
"The reason we have not, historically, carried out refit work was because we had enough work with new construction," started Smith. "New construction is all about your scheduling and a refit project can drastically affect the schedule of your new builds," he added.
As the American new build market slowed down Trinity found itself with surplus capacity and lower margins. The US Market, according to Smith, has been hit by "the perfect storm."
"Everything is on sale in Europe at the moment," explained Smith. "If you are American you have 20-25 per cent better buying power now (with the strength of the US Dollar).”
Beyond currency levels, the quality of European builds is an often-cited reason for US buyers looking east, a point that Smith vehemently contests, preferring to point a finger at the domestic political landscape as a main contributing factor.
"There is a class war going on in the US," Smith explained. "It's perceived to be politically incorrect to be building or buying a big custom superyacht."
Under the Obama administration there has been a cultural shift away from the one per cent. In his State of the Union Address, Obama famously challenged the wealthiest individuals in the United States to try working full time and living on $15,000 a year. It is statements such as these that, according to Smith, have damaged the US new build market and made UHNWIs cautious.
As proof of this theory Smith offers the example of the historic correlation between the strength of the US stock market and the strength of the US new build sector. "Now you have the [stock] market at record highs and [superyacht] sales are nonexistent," said Smith. "What changed?"
Smith does, though, concede that beyond political unrest and the weakness of the dollar the European yards deserve praise for the way they have promoted their brands on an international level, while the US market has primarily focused on the home market.