LONDON (Reuters) - The grey-haired men stood admiring the line of luxury cars at London’s ExCel centre while at a nearby stand a woman handed over money for a silver cigarette case — not the usual things you would expect to buy at a boat show.
But London’s International Boat Show, one of the biggest in Europe, is looking to tap into other high-end markets to attract new customers during a recession that has priced out mid-range sailors.
“It’s like any industry — it’s looking to diversify,” said Michael Enser, head of marketing at the British Marine Federation, which represents businesses from makers of canoes to super yachts.
“It is bringing in high-net worths, and they are reasonably insulated from the economy. If we invite those people into the show who have not been exposed to boats in the past it is a new audience for manufacturers to engage in, to sell their products, and eventually a new boater.”
Numbers of people passing through the turnstiles at London’s Boat Show have not recovered from pre-recession levels, while exhibitor numbers are down by about 10 percent.
Among the biggest absentees are French boat builder Beneteau along with Dufour and Elan.
“It’s still a very sizeable show,” said Murray Ellis, managing director of National Boat Shows.
“It is not a reflection of the show, that is purely a reflection of the UK economy and the UK marine market.”
Taking the place of boat builders are luxury cars, watches, a contemporary fine art gallery, jewelry and a home cinema. A rare diamonds investment company has also moved effortlessly alongside the champagne bars.
At the other end of the market, second-hand motor boats and yachts, sales numbers have risen by about 43 percent compared with last year, the first time it staged such a facility.
Boatyards said customers were keen to avoid paying the 20 percent VAT sales tax on new builds and the 5 percent depreciation levels encountered in the first year of ownership.
Another attraction is that second-hand boats generally hold their value after the first year, certainly better than cars.
Andy Birrell, a 54-year-old lawyer from Edinburgh, was hoping to save about 200,000 pounds ($308,200) on a three-year-old 47-foot motor boat he had his eye on.
“People are feeling the economic pinch at the moment and they still want to indulge their passion, still want to upgrade their boat or enter the market and used is a great way to do that,” Enser said.
Those looking to splash out more than a million pounds on a new build luxury boat aren’t too concerned about the price or the recession, and motor boat builders continue to bring out ever bigger models targeted at that market.
But those interested in buying a new boat that costs between 200,000 pounds and 300,000 pounds are more hesitant.
“They are having to make decisions on school fees versus the boat,” Enser said. “It comes down simply to that.”
But Inspiration Marine Group, UK dealer for Hanse, Dehler and Fjord yachts, said sales were picking up from a low in 2008 when they halved on the previous year.
“Very few people borrow money to buy them (boats), and I think the general consensus is ‘well I’ve got this money sitting there doing nothing because interest rates are so low I might as well get on and enjoy life’,” said Phil Dollin, group sales manager for Inspiration.
($1 = 0.6490 British pounds)
Reporting by Avril Ormsby