STP on standby for expansion go-ahead

Palma investment project

Joan Rosselló, general manager of STP Shipyard Palma, discusses the future of refit in Palma and the company’s contribution to the Balearic economy.

BY MAX STOTT

STP Shipyard Palma is an enormous refit and repair shipyard in Palma, Mallorca, with 130,000 square metres of technical space that can accommodate superyachts with an LOA of 120 metres. It’s also quite a different facility in the refit sector because of its ‘open shipyard’ management model that permits users to choose the companies they want to work with.

Most stakeholders will know that STP submitted an investment project to the port authority in 2019 which is expected to hugely benefit the refit sector as well as the wider industry. However, these plans have been in the works for a frustrating amount of time. For this reason, we spoke with Joan Rosselló, general manager of STP, to get a better understanding of the potential for this expansion and the true impact it will have on the Balearic economy.

Since the shipyard opened 15 years ago, it has grown in many respects. There have been some massive investments that include the upgrading of new machinery and the building of new infrastructure, yet there’s still an enormous demand for space, both on the hard and in the water. The vision for the shipyard now involves redistributing workspaces and creating even more space to supply what feels like a never-ending demand.

Rosselló says, “An expansion at STP would respond to the huge demand from yachts currently looking for other destinations due to lack of space at our facilities. This would be an incredible opportunity for the yachting industry in general and for refit and repair companies in particular.

“There are more than 600 companies registered at STP to work on the 1,000plus yachts that come to the yard each year. To increase that number of boats would have a direct impact on their businesses and on the Balearic economy because each yacht stopping at the yard comes with a crew that has a high purchasing power, even higher than the average tourist visiting the Balearic Islands.”

The superyacht refit sector is sometimes overlooked in terms of its economic value. However, the figures speak for themselves when it comes to STP’s general contribution to the Balearic economy. The superyachts, along with the 600 companies working at STP, are estimated to generate about €250 million directly, €170 million indirectly and an additional €64 million in induced income. In total, STP contributes €484 million to the Balearic yachting industry every year.

Speaking about the yard’s financial contributions, Rosselló explains, “The refit sector is one of the driving forces of the Balearic economy, creating both jobs and industrial activity. We grew by 220 per cent among repair companies, saw a 300 per cent rise in this sector’s workforce and a 250 per cent increase in repair sites.

“There has also been a growth in the quality and quantity of repairs themselves. Yacht repair de-seasonalises and complements tourism, so our business is a continuation of the tourism season. This is an economic activity that Mallorca is excelling at, and it needs further development. Mallorca is now one of the most important yacht repair hubs in the world by number of repair centres per square metre and in terms of quantity and quality of the service, technology and space.”

There are, of course, some colossal challenges facing the refit sector, and from STP’s point of view there are only so many factors that they can influence. It’s their job to define guidelines and ensure they are respected in order to streamline the proper operation and safety of the facilities but, ultimately, they are not solely in charge of managing the refit and repair projects.

Their main concerns are to do with the surprises that crop up during the refit process and how they can go on to affect the planning and timing for the rest of the season. It’s easy for a chain reaction to occur that affects several sectors and departments in the shipyard, and with more than 2,500 people accessing STP every day in high season, it’s paramount that the shipyard ensures a smooth operation.

Speaking on the challenges facing STP, Rosselló points towards the elephant in the room. “The huge challenge today is the lack of space. This forces yachts to head to other destinations, which not only affects the journey itself, but also changes the budget due to the business model of other yards with their own suppliers, while the quality of the repair is in the hands of the yard manager and their partners.

“This is precisely one of the highestrated aspects of STP. As it’s a yard with an open-management model, each yacht can choose its own suppliers. What’s more, the companies that the captains choose to work with, whether local or foreign, choose the quality level

“Each yacht stopping at the yard comes with a crew that has a high purchasing power, even higher than the average tourist visiting the Balearic Islands.”

Joan Rosselló, STP general manager.

STP Shipyard Palma.

according to the supplier, manage the repair time and have greater control over the budget.”

In the last Refit Report (issue 210), the main takeaway was the idea that every business at the top of the refit ladder has expressed a desire to evolve their models, educate and offer a more wellrounded lifecycle service proposition. The general consensus was that if a refit yard wants to be future-proof, it needs to focus its efforts on taking preventative and predictive maintenance approaches rather than trying to correct major issues on ridiculously tight deadlines.

This giant transition shouldn’t be just down to the efforts of a few private refit shipyards; it’s up to the owners, crew, management companies, insurers, lawyers, new-build yards and a whole host of other sectors to make this change happen properly and collaboratively. That said, Rosselló believes STP should not solely focus on preventative and predictive maintenance approaches at the expense of more time-consuming, large-scale refits.

“All yachts with their different types of needs are welcome at STP,” he says. “While it’s true that maintenance or prevention works are shorter and involve less investment, they also entail a greater turnover, while major refits take up space for longer but involve lots of companies, entail greater investment and provide much more revenue to the yachting industry. Perhaps the key is to strike a balance between the two.” Unprogressive entities in both the political and yachting realms hampered the maturity of the industry in Palma for far too long, and it has always felt as if its enormous potential wasn’t being realised. Hopefully, we’ll soon see action replace anticipation and the superyacht refit sector can continue to develop into a strategic industry that helps fill a hole in the Balearic economy.

Over the next few years, there’s no doubt that the entire bay of Palma will be greener, more profitable and even more appealing to outsiders. The only frustration is that we don’t know how long it’s going to take but, as all stakeholders will surely agree, the sooner the better. MS

“The companies that the captains choose to work with choose the quality level according to the supplier, manage the repair time and have greater control over the budget.”

CHALLENGE CONVENTION.

At The Superyacht Agency, we like to challenge the ordinary and explore the unknown. We create energetic campaigns driven by market insight and intelligence that ultimately form the basis of your business, brand and marketing strategies. If you’re tired of the ordinary, get in touch to see how we can reinvigorate your brand.

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STERN WORDS

“HI SUPERYACHT INDUSTRY, CAN I HELP?”

How an impressive new AI could play a role in transforming the refit landscape.

BY JACK HOGAN

ChatGTP has revolutionised the tech world in a few short weeks since its release in November 2022. The idea of a chatbot tends to elicit eye rolls from internet users. The obviously fake avatars with bland human-sounding names and faces that offer help are easy to write off as transparent attempts at cost-saving by companies with an online presence.

Developed by open source AI, ChatGTP is an entirely more complex piece of software. As it has filtered out across the media and tech landscape it has continually surprised, shocked and scared those that have used it.

The system works via word association. As opposed to a strict rulesbased AI that may cross-reference a catalogue and look for what may be termed the ‘correct’ answer to a specific task or question, ChatGTP collates vast amounts of text to form the most common word associations to produce a dialogue-based output. The developers themselves are not sure exactly how it is producing some of its answers, but the results are impressive.

To finish this edition, I posed a simple question: How can AI benefit the superyacht refit industry? The following is its response:

“The use of artificial intelligence (AI) in the superyacht refit industry can bring numerous benefits, from streamlining complex processes to improving efficiency and reducing costs.

One of the biggest challenges in the superyacht refit industry is the need to manage a large amount of data, such as technical specifications, material, and labour costs. This can be a timeconsuming and error-prone process, but AI can help to automate and optimise these tasks.

For example, AI algorithms can be used to analyse large amounts of data and identify patterns and trends that can be used to improve the refit process. This can help yacht owners and refit companies to make more informed decisions and reduce the risk of costly mistakes.

In addition, AI can be used to automate the management of logistics and supply chains. This can help to ensure that the right materials are available at the right time, reducing delays and improving the overall efficiency of the refit process.

Another key benefit of using AI in the superyacht refit industry is the ability to improve safety and reduce the risk of accidents. AI algorithms can be used to monitor the refit process in real-time, providing early warning of potential hazards and allowing for timely intervention to prevent accidents.

Furthermore, AI can be used to improve communication and collaboration within the refit team. For example, AI-powered virtual assistants can be used to facilitate communication and coordination between different departments, helping to ensure that everyone is working towards the same goals.

Overall, the use of AI in the superyacht refit industry can bring significant benefits, from improving efficiency and reducing costs, to enhancing safety and collaboration. As the technology continues to advance, it is likely that AI will play an increasingly important role in the superyacht refit industry.”

As we head into the extended Christmas break and look ahead to 2023, I encourage any readers to try this for themselves. The future of search engines, essay- and copywriting may have already arrived. JH

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