Well-heeled mainlanders push up prices of luxury yachts
Affluent mainlanders have pushed up prices of luxury yachts, with some boat prices surging by as much as 30 per cent in just a year, according to dealers.
'Mainlanders have just started to buy yachts, and they want the most luxurious boats available. They think the priciest ones are the best, as they lack experience and education in yachts,' said Joe Chan Chi-wan, director and manager of super-yacht management company Master Yachts.
Some manufacturers are putting up their prices simply because of this mainland factor, Chan said, although in contrast to the free-spending mainlanders, Hong Kong buyers are looking for good bargains.
'Some manufacturers ask agents if their clientele includes mainlanders because they prefer dealers who sell boats to mainland customers,' Chan said.
'To many mainland yacht buyers, HK$10 million is just so many coins, and they buy boats with pricetags of HK$50 million, HK$60 million or even HK$70 million.' He said mainland buyers also preferred European brands, which they believed were more fashionable.
Inflation is another reason for the escalating prices. According to Jacky Cheung Yat-yeung, owner of yacht broker Smart Concept Craft, prices of yachts manufactured in Europe have increased by more than 20 per cent in a year, while those from the United States rose by more than 10 per cent.
Cheung, who works with yacht manufacturers in Taiwan, said overall manufacturing costs of yachts rose by 15-16 per cent in the past 12 months.
He blamed the increase on the surging price of fibreglass, a material used in the construction of boats, which he said had jumped more than 10 per cent in a year. Labour costs were also up by about 8 per cent and the weakening exchange rate of the US dollar was another negative factor for the company, as it needed to settle payments in the stronger Taiwanese dollar.
'But despite the higher prices, mainlanders in Hong Kong can still afford luxury items because they are so wealthy,' Cheung said, adding that he was about to close two deals totalling between HK$20 million and HK$30 million with mainlanders.
'There are so many industries in the mainland, even shampoo manufacturers, that come to Hong Kong to raise initial public offerings. The mainlanders are getting richer, hence they are happy and willing to spend,' he said.
Samuel Wong Kam-fai, executive director of mainland craft brand Accelera, said his company, which has about 40 years of history in boat manufacturing, launched the new brand two years ago and was now selling boats directly to clients on the mainland.
'Many of our clients are executives of Hong Kong-listed mainland companies, and they pay by cash in instalments. They pay a few million in each instalment,' Wong said.
Fewer than 30 per cent of his clients were from the mainland a year ago, but the figure has now risen to about 50 per cent, he said.
The firm took part in the three-day boat show at the Gold Coast Yacht and Country Club that ended yesterday.
Albert Wu, general manager of the club, said a boating magazine had arranged for a group of about 40 to 50 wealthy mainlanders to attend the show, demonstrating the strong interest and purchasing power of people from this market.