More on CNI’s Super Yachting Index
Yesterday, I reported some of the major points contained in the newly released Super Yachting Index from Camper & Nicholsons International. Today, having had a day to chew on the data, I’m going to offer some analysis.
For the record, I am also continuing to ask questions of the team at CNI who compiled the report. As the answers to my questions come in, I may revisit this data yet again here on the CharterWave Editor’s Blog.
The assertion that jumped out most to me in the Index claims that about 200 of the available 830 yachts in the 80-foot-and-larger size range performed half of the 2,750 weeks of charter that took place in 2007. Put another way, that means 24 percent of the available worldwide fleet each performed about seven weeks’ worth of charters, leaving 76 percent of the fleet (630 yachts) that performed the remaining 1,375 weeks, or about two weeks of charter apiece.
If three-quarters of the yachts available for charter in the 80-foot-and-larger size range are, indeed, performing just two weeks of charter apiece, that is big news.
As a charter client, you would have no way of knowing this, but most charter management companies tell yacht owners that the “gold standard” of charter is getting 12 weeks of bookings each year. That’s also the mark a lot of captains say they are striving for when I meet them at boat shows. When they say they want four, six, or eight weeks of charter, they usually precede the number with the word “only.” It appears, if CNI’s data are correct, that “only” seven weeks of charter a year is in fact what the most successful charter yachts are doing–falling more than 30 percent short of what yacht owners and captains are being told is the definition of a successful year.
This same data could mean a couple of different things for you as a charter client. If, in fact, three-quarters of the yachts 80 feet and larger are booking only two weeks of charter each year, then there is either a heck of a lot more availability out there than (at least I) previously perceived, or there are a ton of yacht owners promoting their boats for charter without actually making them available.
If the truth is that 76 percent of these yachts are sitting idle, hoping to book 12 weeks a year but only managing to get two contracts signed, then you as a client have far more bargaining power when it comes to getting the vacation you want, where and when you want it, and at what price. The yacht owners need your business more than you need their specific yacht. That would be good news for you as a client, indeed.
On the other hand, if the truth is that these 76 percent of yachts are being advertised for charter without truly being made available for bookings, then you as a client are in a far worse bargaining position than the size of the worldwide fleet indicates. If there are just 200 yachts actually seeking your business, instead of 830 yachts that seem to want your business, then you are going to face much more limited supply when you make your requests to owners for contract addenda and price negotiations.
I’m honestly not sure which scenario is closer to the truth, but my educated guess is that each scenario is “a little more true” at opposite ends of the size spectrum.
A guy who owns a 180-foot motoryacht probably doesn’t care whether he books just two weeks of charter each year, since he can, well, afford to own a 180-foot motoryacht. He doesn’t need your charter business to keep his yacht, so it’s counted as part of the available fleet without really being available at all. You’ll have little luck negotiating anything with this owner, as he owns a rare commodity and has no incentive to bargain.
At the opposite end of this spectrum is the owner of an 80-foot sailboat, who perhaps saved his whole life to buy his boat. He does need your 12 weeks of charter business to offset his expenses, and he’s probably out there trying to determine how he could make his boat available for 15 weeks instead of 12 if more clients like you appear. You’ll often have good luck negotiating a charter deal with an owner like this.
In between these two kinds of yachts lies the bulk of the market, according to the CNI Index, meaning yachts in the 100- to 130-foot size range–where you’re likely to find owners who fit both mind-sets. So as fascinating as all these newly released data are to consider, the reality is that we’re right back where I so often start here on CharterWave: recommending that you work with a reputable broker who knows the owners and captains in all size ranges and can help you find the type of charter yacht that best fits your needs, financial and otherwise.
What an interesting question to try to answer, though, regarding how many yachts are actually out there performing how many charters apiece. I look forward to hearing what the team that produced the Index for Camper & Nicholsons says, as I have posed this question to them as well.