Maryanne Edwards, GMBA, talks to an Australian Industry Champion about his thoughts on the current state of the Australian Industry. Steve Fisher has pioneered strategies in the marine industry in development, design, and management of large yachts. Steve has over 30 years’ experience in this field. His international position within Rivergate sees Steve co-ordinate and manage superyacht refits, which rival refits carried out anywhere in the world. Steve is responsible for ensuring all major projects are completed, on time, on budget and to the highest quality. In recognition of his industry experience, Steve was awarded Superyacht Industry Champion of the Year in 2014. Steve is also a current board member of AIMEX the umbrella body for Superyacht Australia.
Question 1.
WHAT DO YOU SEE AS THE KEY INDUSTRY SEGMENTS AT THE MOMENT, THOSE DOING WELL THOSE MAYBE STRUGGLING?
Response:
Within Australia, the manufacturers of leisure craft are the best positioned to capitalize on the COVID-19 driven changes in the travel plans of both domestic and international travellers. In Australia boating has become an alternative to international travel and overseas holidays – with waitlists for several Australian-based boat manufacturers now upwards of two years. The shortage in available vessels, coupled with the upsurge in demand has also generated an increase in the price of well-maintained second-hand vessels – demand is strong.
At the opposite end of the spectrum are the tourism operations that relied heavily on an international clientele. Many marine focused tourism providers are only hanging on due to the stimulus cheques that continue to be provided by the Government. Having said this, changes to border restrictions are having a positive effect on local marine tourism providers. Australians are starting to travel within Australia, and although domestic travel is only a fraction of what the International Tourism market was pre-covid, the internal domestic traveller is helping to cushion the impact of the downturn in the marine tourism sector.
Question 2.
WHAT ARE THE CRUCIAL ISSUES MOST BUSINESSES ARE ADDRESSING TO ENSURE SURVIVAL AND SUCCESS?
Response:
Strong COVID-19 policies within any business remain critical. Rivergate and other Australian refit yards have (and continue to) develop and adapt Covid protocols to maintain the safety of contractors, tenants and especially the international crew and owners arriving on superyachts. Many of our new international superyacht clients, credit the strength of Australia’s Covid 19 policies and procedures with why they chose to stay here in Australia.
The captain of a 60-meter yacht, now back in the Northern Hemisphere indicated last week,
“…we are now in the Gulf of California, and we are still using the COVID-19 protocols we learned in Australia, they are the best in the world!”
Critically I feel the ability to PIVOT in these changing times is key. The past year has changed the industry and industry must change to successfully respond. Business protocols around the way staff work, staff travel policies, how we market our services and interactions with current and potential clients have all been reviewed by many businesses within the Australian marine industry, as no doubt they have all around the world.
Question 3.
HAS THERE BEEN A NOTABLE CHANGE IN SUPPLY CHAINS WITH A MOVE TO SOURCE MORE LOCALLY?
Response:
As a general principle, Rivergate, as an example, is sticking to its existing supply chains. Most of our customers have a very specific product in mind, which is usually only available from the one manufacture and therefore we source the specific product directly from that manufacturer. When lead times get too long – which is happening due to COVID-19 – we will source the product from wherever we can. This means we sometimes find ourselves sourcing a product from a distributor in another country simply because that distributor has stock. For example, if stock is available off the shelf out of New Zealand or Singapore, we will pay a bit more and buy that stock, rather than wait for the stock to become available from the manufacturer.
Question 4.
HOW ARE CHARTER BROKERS/AGENTS COPING WITH THE CURRENT SITUATION AND LACK OF UNCERTAINTY AROUND BORDER CLOSURES?
Response:
The Border Closures and the restrictions on travel to Australia are having a massive effect on the industry. In the early days of the pandemic, it was apparent that international superyachts could be hosted in Australia in a Covid safe manner, and Rivergate’s phone was ringing off the hook with vessels wanting to come to Brisbane for maintenance. Crews were being tested for COVID-19 in their last international port, isolating on board for a total of 14 days, being retested after 14 days, and then cleared into Australian Waters. This was being done safely and was adding significantly to the marine economy without any increase to the overall risks associated with the pandemic. This was a win-win for both the Australian economy and the vessel owners. During this period, not one positive COVID-19 test was attained from an inbound Superyacht.
Question 5.
ARE CONSUMERS STARTING TO BUY LARGER VESSELS, OR WITH COVID ARE CONSUMERS LOOKING TO SPEND MORE RECREATIONAL TIME WITH THEIR FAMILY ON A MANAGEABLE SCALE AND LOOKING AT SMALLER, EASIER TO MANAGE VESSELS?
Response:
For many years boaties have been buying bigger and bigger vessels. Nine thirty-meter plus yachts were imported into Australia by Australian Owners over the last three months of 2020 and this trend is accelerating. If anything, there is a real move towards BIGGER IS BETTER! Owners are investing funds that would normally be spent on overseas travel, into boating. Having said that we are also seeing smaller boat owners doing more maintenance to improve their boating experience.
Question 6.
IS AUSTRALIA STILL EXPECTING SUPERYACHTS TO COME HERE POST THE AMERICAS CUP?
Response:
Yes – Rivergate has received numerous inquiries from yachts looking for maintenance post the America’s Cup, and an upswing in maintenance work is expected in the second quarter of 2021. The other significant growth opportunity is in guest trips along the Australian Eastern Seaboard for yachts departing from New Zealand. Many of the yachts that are in New Zealand wish to introduce their owners to the eastern Australian seaboard, and of course, the Great Barrier Reef. Captains are developing cruising itineraries to maximize the South Pacific experience for their Owners and Guests. For Australia to grab this post-Americas Cup opportunity with both hands, we must have uniform, supportive entry procedures for these visiting Superyachts. Vessels can be hosted in Australian waters in a COVID-19 safe manner. The various levels of government need to coordinate with Industry to welcome these international superyachts. It is important government understands our industry has taken a proactive stance to the COVID-19 pandemic establishing tight protocol and procedures for visiting superyachts. We have proved professionally manned and managed superyachts can visit Australia in a Covid safe manner and, as such, contribute positively to the recovery of the broader Australian economy. Superyacht Australia is working closely with government to ensure standardised entry processes and regulations are applied for visiting superyachts.
QUESTION 7
WHEN INTERNATIONAL BOAT SHOWS RESUME, WILL THEY BE AS IMPORTANT AS BEFORE?
Response:
Downunder in Australia, we are a tad isolated, and a detailed understanding of the wider marine market can only be gleaned through travel and boat shows. Zoom conferencing during COVID has helped the industry to stay in touch, but there is no substitute for stepping aboard a yacht, feeling it move under your feet, touching and smelling the finished product.
There is an industry view that displaying at Boat Shows has become too expensive and some correction is overdue. The pandemic may inadvertently help with resetting boat show participation pricing. The industry is anticipating that rates will go down because total show visitor numbers are expected to be down in 2021 and possibly 2022.
Boat Shows are really the only time you get manufacturers, service providers, sellers, buyers, colleagues and journalists together in the same location, so yes, I believe boat shows will remain important. The BUZZ of a show generates an almost self-fulfilling desire to own a boat; no one wants to lose that productive vibe.
For further information
Maryanne Edwards
Email: medwards@gmba.blue or info@gmba.blue
Mobile:+61412916036
Website: www.gmba.blue
Disclaimer: Global Marine Business Advisors and its associated website www.gmba.blue are not registered legal entities. GMBA is a network of independent marine industry advisors.