Forbes India Rich List 2022

No longer a mere possession: Rich millennials are overhauling the luxury yacht industry

A new generation is redefining what it means to own one of the finest luxury assets—yachts—and reshaping the industry in the process

Published: Oct 27, 2022 10:19:28 AM IST
Updated: Oct 27, 2022 10:58:05 AM IST

No longer a mere possession: Rich millennials are overhauling the luxury yacht industryGautama Dutta, executive director, and Anju Dutta, managing director of Marine Solutions, a yacht brokerage, charter, management and marina services company Image: Edric George for Forbes India
 
A line of luxurious yachts docked at Monaco’s Port Hercules during Formula One’s most anticipated races is symbolic of the yachting lifestyle that has captured the imagination of many who aspire to own their floating palace. A yacht is seen as a luxury asset in its highest form. Now, a new generation is redefining what it means to own the finest pleasure vessels and reshaping the industry in the process.

 Visiting new exotic destinations, indulging in leisure activities, both on board and at sea, and sharing experiences with the digital world are ways in which young sailing enthusiasts are driving change. Technological innovations, design and sustainability are only making the industry more alluring.

Johan Pizzardini, 44, communications and media manager, Monaco Yacht Show (MYS), sees the new pleasure-seeking generation, with their own social codes, live and enjoy yachting differently from their parents. “In recent years, the lifestyle of the new gen has slowly redefined every aspect of the yachting industry,” he says.

 The younger generation of yacht owners places more importance on what they can do with the vessel instead of merely possessing it.

“For millennials, it’s not about the yacht itself, but creating unique experiences with it,” says Tim Davis, 45, CMO of superyacht brokerage, charter and management firm Burgess, London, which has 14 offices worldwide, including Mumbai. 

New Wealth, New Market

Travel, technology, privacy and a sense of adventure are some of the key driving factors making this demographic growth in the industry, according to Advait Deodhar, 32, senior sales and charter broker at boutique yacht brokerage company TJB Super Yachts, London, which has a presence in India since 2016.

 A generational shift of wealth has made superyachts more accessible to a new demographic as the number of young high net worth individuals (HNWI) is on the rise. In the last 20 years, the median age of superyacht owners has decreased by about 10, reveals a 2017 study by the International University of Monaco in collaboration with shipyard Rossinavi. The average age of superyacht owners is projected to be between 35 and 45 over the next two decades. The Henley Global Citizens Report 2022 reveals the number of dollar millionaires and billionaires in India is expected to increase by 80 percent in the next decade.

 “My millennial client percentage has increased substantially this year and I would say about 33 to 35 percent of my clients are millennials,” says Deodhar, who sees the interest growing year-on-year.

 Burgess has over 200 active Indian clients with an increasing percentage of those in the millennial bracket.

Also watch: The billionaires and their superyachts

 Anju Dutta, managing director of brokerage, charter, management and marina services company Marine Solutions, Mumbai, says the customer base in India is growing exponentially and yacht inquiries are in the hundreds. “Millennials count for close to half of the demand,” says Dutta, whose company holds exclusive dealerships for iconic yachting brands like Ferretti Yachts, Pershing, Riva, Prestige, Jeanneau, Sea Ray, Fountaine Pajot, Zodiac and Seakeeper.

 The experience, although exciting, is an expensive one. “The range we have on the market starts at around €625,000 for a 22m (72 ft) yacht and ranges to €150 million,” says Davis.

 Yacht charters, Deodhar says, can range from €20,000 per week for a small yacht. The 136-meter Flying Fox—the most expensive superyacht in the world—costs up to €4 million per week. Custom-built yachts, like German shipyard Lürssen Yachts’ 156-meter Dilbar, can cost upward of €500 million to build.

No longer a mere possession: Rich millennials are overhauling the luxury yacht industryDesign and leisure activities, both on board and at sea, are some of the ways in which young sailing enthusiasts are driving change in the industry
Image: Burgess

Show, Tell, Immerse

The industry is slowly evolving to adapt to a new kind of clientele. Demonstrating how yachts of all kinds can be reimagined to fit their requirements and lifestyle has been a key initiative to target a new generation.

 In 2022, Burgess launched a campaign to target a younger audience, highlighting the experience of yachting, whether a client wants to charter a yacht with family, circumnavigate the world or use it as a force for good. “It is our job alongside the captain and crew to show how diverse, flexible and special that experience can be,” says Davis.

 TJB Super Yachts is clued on to the latest developments in superyacht technology, from on-board entertainment to water toys, and uses that knowledge to lure the younger generation.

 Boat shows, like the Monaco Yacht Show, are also vital to get experts and builders to showcase the best the industry has to offer. “As a leading superyacht event, the Monaco Yacht Show has the responsibility to support the promotion of the yachting market by attracting new prospective clients to the show,” says Pizzardini.

 At this year’s Monaco Yacht Show—held from September 28 to October 1—there were 530 exhibitors and almost 40 new launches (motor yachts, large sailing yachts, yachts with a sustainable approach, futuristic-designed units, classical-designed yachts, a new generation of luxury tenders and water toys). Fleets varied with a range from 20m to 115m.

No longer a mere possession: Rich millennials are overhauling the luxury yacht industryThe industry is taking initiatives to demonstrate how yachts of all kinds can be reimagined to fit the lifestyle of a new generation Image: Burgess

 Finely crafted grandiose vessels, like Lürssen’s 115m superyacht Ahpo—one of the largest superyachts out of the 118 exhibited at the show—were on display in all their glory. Yachts designed with a fresh approach, ones that the younger clients could take a fancy to, were also in the spotlight. The Project X (88m) by Greek luxury yacht builder Golden Yachts shipyards features innovative solutions and the latest cutting-edge technologies on-board. Dutch builder Damen Yachting built Come Together (2022 build, `60m) to reinvent the charter experience.

 Strategies like educational initiatives and immersive experiences are thoughtfully curated to draw in potential younger clients into the cruising lifestyle. Educate and seduce are the two core concepts behind the Monaco Yacht Show’s three-year plan (launched in 2021) to target a new gen of clients. Themed exhibitions are designed to get guests lost in the world of superyachting. You can go for a sea trial on-board tenders on display at the Adventure Area or learn from designers at the Yacht Design and Innovation Hub. “Our ‘seducation’ programme involves the promotion of yachting to our new audience with a 360-communication strategy,” says Pizzardini.

Also read: 2022 Luxury Special: Inside the lifestyles of the 10 percent

 The show’s summit, now in its sixth year, is an opportunity for visitors to dive deep into all things yacht. “A panel of designers, brokers, builders or financial advisers will inform you about all the practical aspects you need to know to carry out your yacht project,” says Pizzardini.

 In a new market like India, Marine Solutions has taken a similar approach to sell the experience by inviting young Indian HNWIs to exclusive yachting events—like the Ferretti Preview at the Yacht Club de Monaco and the Cannes Yachting Festival. It is an opportunity for potential investors to see, feel and take the yachts out to sea. “We understand that Indians are relatively unfamiliar with boats and yachts and yet aspire for the yachting lifestyle, so we encourage people to charter yachts and experience their dream,” says Dutta. 

No longer a mere possession: Rich millennials are overhauling the luxury yacht industryDutch builder Damen Yachting built ‘Come Together’ to reinvent the charter experience for the young generation

Green Yachting

 Awareness, especially among the new generation, has been growing about the yacht industry’s environmental impact and the need for more eco-friendly solutions.

 By 2050, the International Maritime Organization has called for the maritime industry to reduce greenhouse gas emissions by 50 percent from 2008 levels. What’s more, the new demographic is emerging as a sustainable generation with a desire to reduce the carbon footprint of their boat.

 “Global trends show that the new generation millennials, mostly 35-45 years old, are highly environmentally consciousness,” says Dutta. “This segment now comprises nearly 30 to 40 percent of the new yacht buyers.”

 Boat builders and shipyards are aware that new expectations from new clients are inevitable. An increasing trend towards sustainability was displayed at the recent Cannes Yachting Festival. “Riva, the world’s premier yachting name, presented the El Iseo, its first fully electric motorboat,” says Dutta. “Fountaine-Pajot catamarans announced smart electric a fully automated energy management.”

 Rolls-Royce and Ferretti Group are jointly developing sustainable solutions for future yachts. “A first major milestone is a cooperation to instal an MTU hybrid propulsion system in a new Ferretti Yacht model,” says Dutta.

 Polish builder Sunreef unveiled the world’s most advanced sustainable luxury catamaran, 80 Sunreef ECO, at this year’s Monaco Yacht Show, which also launched a Sustainability Hub, for the first time, to educate visitors about sustainable solutions in the yachting industry.

No longer a mere possession: Rich millennials are overhauling the luxury yacht industryPolish builder Sunreef unveiled 80 Sunreef Eco, the world’s most advanced sustainable luxury catamaran at the Monaco Yacht Show this year Image: Monaco Yacht Show

Industry Challenges

Internationally, the post-Covid year has seen a boating boom as the yacht brokerage market is flourishing with the super yacht section in high demand. Meeting that demand has been one of the challenges. “There has been a global shortage of yachts on purchase and charter,” says Deodhar. “Shipyards have slots booked with delivery all the way in 2027.”

 Infrastructure is the main issue in India even though insiders believe there is a proven interest in boating. “It is evident that with the government’s active participation in creating marinas and yacht facilities, the yachting industry will boom,” says Dutta.

 Owning a yacht, Deodhar explains, in India can also be a long and expensive process due to the exorbitant import tax as the market in the country is still nascent. “In addition to that, there aren’t as many cruising locations to make the most of owning a yacht in India,” he adds. “For Indians looking to charter overseas, there is enormous potential and this is where much of my focus is spent.”

No longer a mere possession: Rich millennials are overhauling the luxury yacht industryLürssen’s 115m superyacht Ahpo was one of the largest out of the 118 on display at the Monaco Yacht Show Image: Monaco Yacht Show

Future of yachting in India

The future of boating in India may appear choppy, but there is a lot of enthusiasm around it. The collaboration between Burgess and Marine Solutions is a clear sign of that. “The partnership aims to connect the global yacht charter network with the fabulous cruising destinations in India, Sri Lanka and the Maldives, and at the same time offer Indian clientele the option to enjoy yachting worldwide using the Burgess network,” says Dutta, who is also the Burgess Brokerage Representative.

 The work-in-progress to build yachting infrastructure, marinas and associated infrastructure to connect India’s beautiful coastline and enable yachting makes Dutta optimistic about the future. “Thanks to the government’s initiatives in the right direction, we have installed and are in the process of installing a number of yacht-friendly floating jetties in Goa, Mumbai and Cochin,” says Dutta. “We are looking at close to 40 such jetties around the Cochin backwaters within a year that will provide a boost for boating.”

Navigating the High Seas

 Bringing a new generation into yachting will be key to ensuring that the cruising life retains relevance and continues to be considered a truly extraordinary experience long-term. “No one brand can do this on their own… we need to recognise that more can, should and must be done to pivot our industry towards a new generation,” says Davis.

Pizzardini believes technology, sustainability and a new way of life on board will be the three pillars of tomorrow’s yachting. “The industry is completely committed to researching and developing innovative sustainable solutions; the exponential boom of technology will offer outstanding solutions to a better yachting experience,” he says.

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(This story appears in the 04 November, 2022 issue of Forbes India. To visit our Archives, click here.)

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