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Shi Jing
Friday, May 2, 2014

Asia

Riding on the crest of a sales wave

China Daily/ANN | Shi Jing | Friday, May 2, 2014

Unlike the time when China's yacht industry was still emerging and largely dependent on overseas brands, 2014 has seen more domestic brands catching up with world leaders in the field.

A 22-meter boat from Shanghai Choisi Yacht sold for 17 million yuan (S$3.38 million) and Shenzhen-based Speedo Marine, which has taken part in the China (Shanghai) International Boat Show for 10 years, sold three boats during the show for a total of 8 million yuan.

Xiamen Blue Ocean Yachts Development received enquiries from three dealers and 10 customers in the wake of the industry trendsetter during the boat show that ended on April 13.

Established in 2005, Oriental Recreational Products (Shanghai) has also participated in the Shanghai boat show for 10 years.

The company exhibited three boats at this year's show, and sold two of them. It also received dozens of orders of intent and more than 300 enquiries.

According to industry studies, the yachting industry grows rapidly when per capita GDP reaches US$5,000, and China has already reached this threshold - and in some places even achieved per capita GDP of US$10,000.

Wang Zhiyue, chairman of Oriental Recreational Products, said he is sure the country's industry will reach a time of rapid growth within the next decade.

Of course, overseas companies are loath to lose their share of the booming Chinese market, so they also exhibited their products at the boat show, which is usually the first stepping stone to entering the Chinese market.

Five companies, led by business promotion agency New Zealand Trade and Enterprise, joined the boat show as a group this year.

John Cochrane, NZTE trade commissioner in Guangzhou, said the companies want to introduce world-class products and services en masse to Chinese consumers, and reap the rewards of New Zealand's long expertise in maritime crafts.

However, the path chosen most frequently by companies is cooperation between domestic outfits and overseas brands, especially financial links.

Wang Jianlin, chairman of Dalian Wanda Group and China's richest man according to Forbes magazine and the Hurun Report, bought the privately owned British luxury yacht manufacturer Sunseeker International last year.

Despite the slowing growth in the industry in the past two years, Ferretti SpA, the renowned Italian luxury yacht maker, managed to achieve growth of between 20 and 30 per cent in the Chinese market in 2012 and 2013.

Chen Gang, chief representative of Ferretti's Shanghai Representative Office, said the company has huge brand name recognition among Chinese consumers, despite prices as high as 40 million yuan for a 24-meter yacht.

Ferretti's adjusted strategy, which places greater emphasis on the Chinese market, has helped the company achieve fast growth in China, and it established a foreign-held operation and a joint venture in Zhuhai, Guangdong province, last year.

The Italian outfit was one of the first overseas yacht makers to seek financial cooperation with Chinese companies.

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