Robert Frank a CNBC Reporter and Editor of note believes that when stock prices rise, so do yacht sales. At least, he says, “They used to!”
In a recent article for CNBC Frank reported: “Since World War II, there has been a fairly reliable correlation between the stock market and yacht sales. When share prices rise, the wealthy get wealthier and buy more and bigger yachts.”
He adds, “This post-recession era, however, is different. Stocks have not only recovered but also reached new highs, yet yacht sales and prices are still under water.”
John Dane III, the CEO and President of the US yacht builder Trinity Yachts confirmed the situation at the Fort Lauderdale International Boat Show. He said, “Stocks are up and the wealth is up, but yachts are not following those trends right now like they usually do.”
Dane went on to report, “The disconnect could be due to a lack of confidence in the economic recovery, and that while stocks are soaring, the underlying fundamentals of the economy don’t inspire enough long-term confidence among the wealthy for them to make a $30 million to $40 million purchase.”
He also cited the fact that the political and media climate has become more hostile toward the wealthy. “Many buyers,” he said, “Are fearful of showing up in the press for buying new, expensive yachts.”
“Right now, the wealthy are being vilified in the media,” he said. “No one wants to become a target.”
Yet as was witnessed at the Monaco Yacht Show last September, Russian, Chinese and Middle Eastern buyers have continued to place orders for super yachts.
According to according to the (super)Yachting Indexpublished by Superyacht Times and Camper & Nicholsons, the average size of yachts ordered also continues to increase but U.S. boating enthusiasts who were buying suoer yachts in the peak years have yet to return.
Some industry executives said the slower pace is a more normal market, and that the boom years were an artificial bubble fueled by debt, yacht speculators and customers ordering multiple boats to flip and resell.
Deliveries of super yachts fell to 169 in 2012, down from the boom-time level of 261 seen in 2008. Overall, prices are down about 20 per cent since 2008, and the number of super yachts being built has also fallen