From here, you can see the future
Brett Bolton examines some of the key topics up for discussion when the industry gathers on the Gold Coast this month.
It has been 15 years since I attended my first Sanctuary Cove Boat Show in 2004. At the time, the industry and the economy were in a strong position and a real party atmosphere extended for the four days of the show.
The world changed not long after with the GFC hitting hard in 2007-2008 and doing a number on the boating industry at the same time. Many Australian manufacturers reduced their business outputs and adapted to the changing landscape, or disappeared altogether. Small boat manufacturers such as Quintrex and Haines Hunter pushed on through, whereas large boat manufacturers such as Mustang and Riviera collapsed as market demand for luxury vessels shrank and their ability to wind back their operations and overheads at the same rate was not matched.
Thankfully Riviera was given a second life under the ownership of the Longhurst family, as was Maritimo with another big industry name, Bill Barry-Cotter. They are now Australia’s only major production boat companies delivering multiple luxury models above 40 feet.
The fall-out of the GFC was not just restricted to the production companies themselves but the entire supply chain down to the marinas where the boats are moored. Many highly skilled jobs were lost, and businesses and families driven to the wall. In 2011, on the back of over-commitment or over-development, about 10 marinas were in receivership. It would take a few more years until things stabilised.
As a double whammy, many government agencies managing property in New South Wales and Queensland decided to adopt policy lines that penalised good marina operators with views on tenure and valuation that discouraged operators from seeking to reinvest and grow their businesses. As with other important government policies such as Sydney Working Harbour and the Sydney Harbour foreshore planning framework, this is still to be sorted out and hangs over the head of the marina industry and its future growth.
The GFC certainly changed the face of boating in Australia and around the world but, like a bush wildfire spawning new life in the forest, the new Generation Y and Millennials started to sprout, still wanting the on-water experience but with much less desire to own a boat. As a result, ‘share boating’ has become a popular solution with the market more than tripling in the past five years. Those in the industry who were not threatened by this new market growth have done well, as the concept provides a lower price entry point allowing for many more people to gain access to the leisure boating experience.
This concept also focuses on ‘easy boating’ whereby owners simply step on and step off with all the annoying parts of boating like cleaning, maintenance, fuelling and berthing now being undertaken by the share boat operator. Marina operators who embraced the concept have noticed a sharp rise in fuel sales and activation on the marina providing flow-on benefits to their tenants. Production boat manufacturers moving with the times have been able to supplement the ‘one owner per boat’ type of sale with a ‘many owners per boat’ sale.
The next big thing
Attending all the major boat shows last year I am glad to say that the industry is the most positive I’ve seen it since pre-GFC with both exhibitors and attendees on the rise and overall confidence up.
Now on the eve of probably the industry’s largest ever maritime event on the Gold Coast in the second half of May, we are poised to see what the next big thing will be for the coming 15 years. The Australian Superyacht Rendezvous, ASMEX conference, SCIBS and Marinas19 conference will attract marine industry leaders and businesses from all over Australia and around the world, encompassing most elements of the leisure boating manufacturing and service industries.
I am currently in intense training to survive the two weeks and can already see some of the potential emerging trends such as the growth of the share boat market and stay-on-board accommodation. Marinas are increasingly becoming marine leisure and tourism destinations and the superyacht charter and refit industry is poised for significant growth. If I am correct, the growth of all of these markets will result in thousands of new jobs, including skilled labour, benefiting the State and Federal economic bottom lines. Each market could so easily be energised for the benefit of the country if a common-sense pragmatic approach is adopted. However, by some cruel twist of fate, each is currently being hamstrung by government policy.
No doubt these topics will be on many lips during May. I hope those representatives from government who attend these events can sit and listen to the leaders of the marine industry paint the picture of the enormous potential that sits in waiting.
About the author
Brett Bolton is the director of Coriolis Marine specialising in marina management, government negotiations, acquisition and divestment, due diligence, design, development, project management and risk management. Email firstname.lastname@example.org, www.coriolis.com.au.
This article was published in the May-June 2019 issue of Marine Business magazine.