Plain sailing in sight for marine industry

The country's $2.2 billion boat industry is  said to be on the rebound,  although some players are  remaining cautious.

Marine Industry Association executive director Peter Busfield says the industry is counting on its reputation for innovation and boatbuilding to give momentum to the recovery.

He says the five super yacht orders that have been placed in New Zealand since September last year  compared  with nil in the previous 12 months is an encouraging sign.

"The recession during the past couple of years hit new boat sales but since September 2009 this has come back to a steady level.

"Sales are off their 2007 highs but they've settled down to a level that the marine industry can do good business, be it at a lower level than a couple of years ago,'' Busfield says.

But Waitakere-based Alloy Yachts says the industry situation remains "delicate".

Responding to a query about the next yacht order they are scheduled to fulfil, marketing manager Linda Berry says ``being sailors we are superstitious'' and they'd rather not talk about it.

"Until such time that we start building, we don't want to talk about it as we consider it bad luck.'' 

She says they may have official word on their next project most likely within a couple of weeks.

Since the 2008 financial crisis hit, Viaduct-based McMullen & Wing managing director David Porter says three or four companies in their sector have gone belly up, with the smaller and mid-range boat makers being hit the hardest.

"Certainly, the up to the 100-foot range of boats is suffering probably a higher reduction than the super yachts.

"But then with super yachts you only need one order to get your yard going, whereas if you are making smaller boats you need more,'' Porter says.

Busfield estimates  about 2 per cent  in the industry have gone out of business.

"Even in good times people go out of business. I know it's tough out there but that (low fallout) just shows the industry's good performance and adaptability to change.

"Most of the companies have seen their sales reduced  40 per cent to 50 per cent. They've toughed out the economic environment by putting new business plans in place so they not only survive but look forward to growth in the future,'' he says.

The rebound of the sector is being helped by increased activity in the refit and trailer power boat sectors.
More than 1000 of the 7000 super yachts built around the world in the past 10 to 15 years are due for a refit, and New Zealand is in for a slice of the market.

"Yacht owners are refitting and refurbishing and there is not one facility around the world to handle that amount of business.

"We are  doing about 20 refits a year. And so long as the infrastructure facilities supported by local and central government at Wynyard Quarter and Hobsonville continues, we look forward to increasing the infrastructure so we can take on more of this work than there is demand for now,'' Busfield says.

The industry is successfully promoting New Zealand as a destination for super yachts and this is creating more business for the refit and services sectors as well.

Last year about 100 super yachts called on New Zealand through the Auckland Viaduct, 20 per cent more than 2008, which was also 20 per cent more than 2007.

Busfield says there are more than 150,000 trailer power boats in New Zealand, and with the recession, "people seem to have more time to go fishing and use them and so there is good business in that market as well''.

Busfield expects more than 25,000 visitors to the Auckland International Boat Show  "to beat last year's''.

And with the Louis Vuitton Trophy on at the same time, he expects the event will give another welcome boost to the industry and economy.

The boating industry, New Zealand's largest manufacturing sector, involves more than 1500 companies with a capability to contribute up to $700 million in annual exports, employs  10,000 workers and has more boating apprentices than any country in the world, about 700.

- © Fairfax NZ News