Rough Seas in Europe’s Luxury Yacht Market
By Christina Bohnstengel
After a decade of exceptional growth, the luxury yachting industry in Europe is now showing signs of slowing down with reports of sales of high-end pleasure vessels dropping. The French shipyard Beneteau, known as the world’s biggest maker of sailboats, is cutting 10 percent of its workforce, a figure that equates to a loss of 600 jobs. In one decade, Beneteau grew its annual sales from $235 million to more than $1.4 billion. However, in 2008, the luxury shipbuilder reported a 50 percent drop in sales. The Italian-based boatbuilder, Ferretti, is also suffering, recently restructuring its $1.4 billion debt. Trouble could be brewing for German yacht maker, Bavaria Yachtbau as well. Though CEO Andres Cardenas insists that there are no plans to cut production, its mother company, Bain Capital, wrote the value of the investment down to zero. The smaller shipyards are not escaping unscathed either. Couach and Rodriguez Group are two other French yacht builders looking for temporary bankruptcy protection. Industry experts predict that many of these smaller companies will have trouble weathering this economic storm.
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