need to be an industry of environmental champions’

Stephen Hills, commercial director at Pendennis and chairman of Superyacht UK, says the global mission to meet emissions targets is the real challenge facing our industry rather than the current state of the economy and the ongoing energy crisis.

Despite the bleak economic news at the end of 2022, my assessment as chairman of Superyacht UK is that for most companies within the sector, business is good, order books are strong and pre-Covid profits are in sight again.

A feature of the superyacht supply process is that, generally, projects take time. Great endeavours of the highest quality are rarely quick to achieve, so while the consumer post-pandemic boom in discretionary spending has now moved to concerns about high inflation and soaring energy costs, the impact on British yards is still to be seen. Most projects already started have some way to run, and from the discussions I’ve had with UK business, the loss of Russian trade has had limited impact.

The difficult challenge for the UK superyacht industry now is to decide how, and if, those broader economic pressures will influence the behaviours of our clients and prepare accordingly. The past year has, almost without exception, seen companies growing with determined recruitment drives in response to very strong order books. At present, demand appears to be healthy.

For the UK superyacht sector, I remain convinced that to protect our industry we should continue to focus on investing in our people and facilities in order to deliver service, quality and innovation so we develop and maintain our unique place within the global industry. Most projects include some UK input, be it from our surveyors, legal teams, classification societies, finance, brokerage, insurance, designers, equipment suppliers, crew, management or in new-build or refit facilities. It’s fair to say British companies are recognised as leaders in what they do because they offer the best service, quality and innovation.

As the market adjusts, I’m an optimist and believe our clients will still be in a position to create strong demand, and while the post-Covid peak may drop back to pre-pandemic levels, this should be a sensible reset rather than a catastrophic drop-off. However, I think the real threat which we must respond to is our impact on the environment.

As an industry, we need to present our product in the correct context and take steps to reduce the impact of what we do. We’re not big enough in the UK to lead the development of alternate technology but we have the resources to be active and reduce wherever we can.

Clients will increasingly expect these behaviours coupled with a readiness to embrace and demonstrate new technology. Failure to respond to this challenge is more likely to have an adverse effect on our business than current economic issues. Our customers are generally well placed to deal with economic downturns, but no one is immune to the risks of environmental change and, potentially, legislation. Our critics argue that luxury goods are the least justifiable, and we need a response.

But don’t wait for someone to solve this problem. Each business needs to establish its own credentials. The required change will come as companies increasingly recognise this fundamental shift in the marketplace and take real steps to improve – not greenwashing, but demonstrable reductions achieved through real investments.

We’ll see a significant increase in customers who assess the environmental credentials each company offers, and those offering the best proposition will emerge as the new leaders. In due course, I expect environmental credentials will rank above – or as a fundamental pre-qualification criterion before – time, cost and quality in the client selection process.

At Superyacht UK, we’ll be looking to facilitate debate on this topic, to support the exchange of ideas and initiatives and represent the industry as a whole. If each company is not stepping up to the challenge, there will be little to publicise and we’ll be fuelling the arguments of our critics.

We need to be an industry of environmental champions. While we offer customers luxury experiences, we should do this in a way that is fully on board with the global mission to meet emissions targets. SH

with Jack Hogan