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State of the Yacht Charter Market in 2021


State of the Yacht Charter Market in 2021
Nadia D'Addezio

19 January, 2022 | 3 min read

The past two seasons have been challenging for the whole industry, and while most companies managed to cope with the situation, it did not go through without damages. Between shipyards' production lines being slowed down, raw material crisis across all sectors, and major financial operations within the charter itself added to existing travel restrictions and regulations, every charter professional had to draw on its resources that were already significantly reduced.

The operational issues that shipbuilders have been facing in 2021 (and continue facing in 2022) have as a major result the unavailability of new boats to purchase, especially for small and medium fleet operators that cannot preorder in bulk with two to three years advance. Consequently, key construction market players have not been exhibiting in the last shows, and most companies have a delivery date from 2023 to 2024.

In addition, most countries have suspended government subsidies, and some regions have been investigating abuses in the usage of these aids. The result is a significant drop of brand new boats in the top destination with Greece facing the most considerable reduction.

2021 represented another year of instability for the market with tighter border regulations and with some countries still closed for tourism. Again, the answer was varied; key players were able to move a consistent part of the fleet to close-by destinations with more favorable entry requirements. Smaller operators, meanwhile, had to think more outside of the box and sometimes succumb to the situation.

The lifting of the special VAT conditions in countries like Italy and Greece contributed to instability and reduced the already small margins.

Italy, Greece, Spain, and Turkey managed to contain the damages and recover some market shares, decreasing the loss to -10% compared to 2019. Honorable mention goes to France that had faced the most significant drop in 2020 (-44%) and reduced it to only -7%. As expected, the winner of this race to the bookings is Croatia, which achieved not only to reestablish the level of 2019 but actually registered a +2%.

Even if some markets in the Mediterranean are catching up unfortunately the situation is still not optimistic with almost 40% loss in general booking capacity across all destinations worldwide compared to 2019, while in 2020, the loss was about 30%.
Some destinations like Thailand were still closed for tourists and others like the British Virgin Islands had extremely severe protocols to enter. Martinique and many Caribbean islands also suffered from the instability of the measures taken by other governments allowing or denying access to their citizens in certain areas.

While the number of closed weeks is still not back to normal, charter length is approaching the standard average of 7 days in most countries. The only exception is Greece, where the average charter in 2020 was over 10 days and maintained an average of 9 days in 2021.

While 2020 brought back some direct bookings to professional operators and reduced the market quota of the top 5 agents, the resumption of substantial online advertisement budget, more significant investments in technology, and for some even staff reductions, meant that the percentage of reservations through agents have recovered to the pre-pandemic level.
The unique conditions of a yacht charter holiday proved again to be a successful concept in 2021 thanks to its exclusive nature, it represents the safest way to enjoy holidays, and the sector managed to again survive without significant hiccups and with only a few unfortunate situations.