The Market
MARKET DEVELOPMENTS
According to data provided by our independent market research conducted in 2020, a spike in cumulative New Build output in 2021 was forecast, caused chiefly by the number of delayed project deliveries as a result of the pandemic. A total of 69 yachts of 40 metres and above were delivered in 2021, a marked improvement over the 54 delivered in 2020, and indicative of a New Build market re-stabilised following the pandemic and the knock-on effects it had on the supply chain and labour force. Over the past five years the 40m+ fleet has grown by 13.4% at an average of 65 deliveries per year, confirming that 2021’s output of 69 yachts was above the historic precedent.
The majority of the 40m+ fleet can be categorised in the 40-50m sector, with 58% of the active fleet falling into this size bracket. However, the trend towards larger New Build deliveries continues with the 40-50m segment forecast to grow by a CAGR of 2% between 2022 and 2026, but at the larger end of the spectrum, where GYG operates most effectively, the 70-90m and 90m+ segments are expected to reach a CAGR of 3.8% and 4.0% respectively over the next five years.
This trend continues into the Refit market as new yachts enter their regular maintenance cycle. Between now and the end of 2026, the Refit paint market is expected to grow by approximately 17.8%. The 70-90m and 90m+ segments will see the largest growth, at 34.6% and 42.9% respectively. The 40-50m sector is expected to increase by 15.1%, while the 50-70m sector will grow by approximately 16.2%.
Through 2022, shipyards are predicting a record-breaking number of 122 40m+ deliveries as they look to complete projects delayed from previous years combined with an increased overall demand for superyachts. This is putting New Build shipyards under increased pressure to meet delivery dates when build slots are limited and this level of output has never been seen previously.
We expect many of the predicted projects will experience delays and be pushed into 2023/2024. This is normal, and historically we have seen anywhere between 20-30% of projects moved into the following year. In 2021, that number was closer to 40% as the market continued to adjust to scheduling delays due to issues related to COVID-19. A similar levelling of the numbers is expected in 2022, resulting in a more even spread of deliveries and therefore market value across the next few years.
Over recent years there has been a consolidation of shipyards and a reduction in the number of New Build yards available to potential clients. Now with the increased demand, traditionally popular shipyards have already sold their future build slots, allowing for the potential entry of new shipyards to take on projects.
Furthermore, there has been more investment in infrastructure projects to increase capacity at both large and small shipyards. While these projects are typically longer term, they do demonstrate the need for more build capacity globally.
Source: The Superyacht Agency Intelligence Report for GYG, March 2022. Unless otherwise stated all market estimates and forecasts are sourced from The Superyacht Agency Intelligence Report
*LOA = Length overall
Last Updated: 11/01/2023