Return to Recreational Boat Building Industry Home Page
SOURCE: USDOC, International Trade Administration
SOURCE KEY: IT
PROGRAM KEY: IT MARKET
PROGRAM: Market Research Reports
UPDATE: Monthly
ID NUMBER: IT MARKET 111104799
TITLE: ITALY - PLEASURE MOTOR BOATS - ISA9207
DATA TYPE: TEXT
END YEAR: 1992
UPDATED: 09/17/92
KEYWORDS 1:
| 9207
| BEST|PROSPECTS
| CC475
| COMPETITION
| DISTRIBUTION
| END|USERS
| ISA
| ISA9207
| ITALY
| MARKET|ACCESS
| MARKET|ASSESSMENT
| PLB
| PLEASURE BOATS AND ACCESSORIES
| PLEASURE|BOAT|ACCESSORIES
| PLEASURE|BOATS
| SPORTING AND RECREATION GOODS
| SPT
| TRADE|CONTACTS
| TRADE|PROMOTION
COUNTRY:
| ITALY
| EC
| EEC
| EUROPE
| EUROPEAN COMMUNITY
| EUROPEAN ECONOMIC COMMUNITY
| OECD
| ORGANIZATION FOR ECONOMIC COOPERATION & DEVELOPMENT
| ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMET
| WEST EUROPE
| WESTERN EUROPE
| WESTERN EUROPEAN COUNTRIES
TEXT
ITALY - PLEASURE MOTOR BOATS - ISA9207
SUMMARY
This article is derived from a report titled: "The Pleasure Motor Boat
Market in Italy", dated July 1992, prepared by Susanna Lezzi, American
Consulate - Genoa. This article consists of 08 pages and contains the
following subtopics:
OVERVIEW
STATISTICAL DATA
MARKET ASSESSMENT
BEST SALES PROSPECTS
COMPETITIVE SITUATION
MARKET ACCESS
TRADE PROMOTION OPPORTUNITIES
A. OVERVIEW
The Italian market for pleasure motorboats (including inboard, in-outboard,
and pneumatic boats) has experienced an exceptional growth during the
quinquennium 1985 - 1990, surging two and a half times its sales volume. In
1990, Italian demand for pleasure motorboats reached the peak of its high
development phase. This trend was even more accentuated by important laws
issued by the Italian Parliament which somewhat alleviated tax burdens for
pleasure motorboat owners. After this period of astonishing expansion, the
market has entered a new cycle, characterized by stability and even an
inflection in its growth rate. Nonetheless, this has not affected sector
imports, which in 1991 experienced a 37% increase in sales volume (current
terms) and covered approximately 50% of the market demand. In particular,
U.S. exports to Italy continue to play a preponderant role maintaining an
import market share of 38.0%, and actually covering 19% of Italian sector
market. Notwithstanding "the party's over" atmosphere prevailing among U.S.
domestic powerboat suppliers and a general slow-down currently affecting the
European market, the "stars and stripes" production costs about 20% less
than the Italian one and thus what is generally viewed as the "U.S.
invasion" is expected to continue, with good sales for small and medium-size
inboard/in-outboard and outboard motorboats and especially cabin cruisers
and day cruisers.
B. STATISTICAL DATA
(US $ MILLIONS) (PERCENT GAIN)
Previous Last Current Est. Avg. Annual Real
Year Year Year est. Growth - Next 3 Years
1990 1991 1992
Import Market 117 153 161 3
Local Production 577 466(est) 419
Exports 367 310 301
Total Market 327 309(est) 279 2
Imports from U.S. 48 58 65 5
Exchange rates 1,200 1,250 1,250
Future Inflation Rate Assumed: 6%
Last year's Import Market Share (Percent for USA and
Major Competitors): US: 38.0%; U.K.: 16.6%; France: 12.6%; Germany: 6.5%
Receptivity Score: 3 (1=lowest, 5=highest)
Sources: Italian Boating Association, U.S. National Marine Manufacturers
Association, Italian Naval Register, specialized press, industry operators
C. MARKET ASSESSMENT
1. Market Demand
In Europe the pleasure boat market has experienced a cyclic growth which
reached in 1990 the peak of its high development phase. This trend was even
more accentuated on the Italian market after important laws issued by the
Italian Parliament in 1989 which contributed to further boost its momentum.
In brief, the inductive type of personal income assessment for Italian
resident boat owners became less substantial. In addition, the value added
tax, one time doubled for boats over 18 tons was limited to boats over 50
tons (approximately 20 meters in length) and a new category was created for
small boat owners which pay a reduced VAT, more consistent with European
levels. Thus a 9% VAT was applied to small boats under 3 ton and 6 meters
and 18.5 kW, a 19% VAT applied to hulls up to 50 tons, and a 38% VAT to
hulls over 50 tons. It is understandable how these laws have positively
influenced the growth of the Italian domestic pleasure boat market which
chalked up an amazing increase of 150% from 1985 to 1990.
Since 1990 year-end, however, the industry has been experiencing a slightly
weaker demand for pleasure motorboats. Several factors have contributed to
this end, including the decline in the overall economy with slower growth of
personal income and the reluctance of pleasure boat consumers to take on
additional debt, skyrocketing mooring taxes, and lack of an adequate
infrastructure to support pleasure boating. A pleasure motorboat is by far
a discretionary purchase that can be postponed or canceled. Thus, when the
overall economy weakens, the demand for pleasure boats also declines. The
1991 introduction of outrageously expensive and differentiated annual
mooring tax rates (e.g. an eight-meter motorboat currently costs
approximately $1,000 instead of the previous $160) heavily contributed to
dampen consumer purchases. Many observers indicate that more affordable
marinas and other infrastructures are also badly needed to boost medium-term
demand. Nonetheless, U.S. products, strongly desired by Italian dealers and
distributors because of their innovations, special features, and very
competitive prices, registered a further increase of 26% in 1991 sales to
Italy. Italian demand for U.S. pleasure motorboats is expected to fare well
in the near future, although it is not likely to reach the astonishing
increases of the recent past.
2. End User Profile
Thirty years ago, there was one boat owner in Italy every five thousand
inhabitants, currently, there is one boat owner every hundred; the future
could perhaps envision one boat owner every 20. Italy has after all a
sea-faring tradition coupled with acceptable weather all year round. In
addition, the market should benefit from the fastest growing 35-to-44 and
45-to-54 age groups. The latter, especially, are reaching the maximum
wage-earning period allowing them to consider such large purchases as a
pleasure boat.
Pleasure motorboats sold in Italy during 1990 (last official figure
available) amounted to 4,915 units for inboard/in-outboard pleasure boats,
7,459 units for outboard pleasure boats, and 13,267 for pneumatic boats
totaling sales for $ 327 million. Close to the same amount is estimated to
have been sold in 1991, with a 50% increase in the import of the more
comfortable medium-size inboard/in-outboard pleasure boats. In 1991,
Italian demand for smaller units slightly decreased, with 10% less imports
of pneumatic boats, and 5% less imports of outboard models, notwithstanding
the fact that the small motorboat segment is still by far the most popular,
or rather the more affordable.
Diesel engines are predominant in the inboard and in-outboard
configurations. This trend, generalized all over Europe, is even more
accentuated in Italy. Fuel economy cannot be considered an influencing
factor due to low amount of hours per year of navigation for a pleasure
boat. The dominant criterior is the safety factor, for the same reason that
the installation of two independent engines has become a standard at sea.
Gasoline engine powered boats, thanks to the increased safety factor of
modern designed engines, are also increasing their small market share and
find favorable application in prestige, high performance boats where high
speed, high power concentration and reduced bulk are taken as major design
criteria. Outboard engines are of course practically all gasoline fueled.
D. BEST SALES PROSPECTS
Since a pleasure motorboat is considered a luxury item anyway, it appears
that the sale of commodious boats such as medium-size cabin cruisers, and
the more popular small-size day cruisers (7 to 8 meters long
inboard/in-outboards) is expected to keep up. At the same time,
manufacturers are expected to continue offering smaller units, both for
logistical and economical factors, to appeal to new boating enthusiasts
entering the market. However, there is a weak request at the moment for
runabouts.
Regarding the engines, the propeller system seems to be still the most
popular and efficient system as long as the propeller is properly designed
for the hull and engine characteristics. Waterjets are somewhat increasing
their penetration both in the small and high power segments. While more
appropriate for larger and faster boats, jet propulsion is well suited to
small boats for special applications such as coast guard, fire brigades, and
safe approach of populated beaches where efficiency of the propulsion system
is of secondary importance in respect to safety and practical factors.
E. COMPETITIVE SITUATION
1. Domestic Production
The Italian market for pleasure motorboats is split almost fifty-fifty among
foreign and domestic suppliers. There are approximately 600 shipyards in
Italy, all Italian, of which about 200 cover 70% of total Italian sales.
Among these are renowned names such as ABBATE, AZIMUT, BAGLIETTO, RIO, and
RIVA. The remaining 400 are small artisan-type enterprises. Italian
shipyards have an average export share of over 65% of their total billing,
but in the high prestige segment, this share exceeds 90-95% with some
shipyards working exclusively for the export market. High technology, style
according to the world-famous "Italian design" of the hull line and vessel
interiors are the main reasons for achieving a high share of this market
where price competition becomes a factor of secondary importance.
The propulsion systems selected by Italian shipyards for powering their
pleasure boats appear very international. Italian engine manufacturers are
present all along the line with diesel and gasoline fueled engines
successfully exported all over the world. On the other hand, Italian
shipyards select the engine according to customer and boatbuilder
requirements often selecting engines imported from the United States,
Germany, Sweden, etc. This makes import-export figures very high on both
sides. Italian engines used by Italian shipyards are mainly inboard engines
in the lower power bracket (both diesel and gasoline) to mention just a few
IVECO-AIFO, BPM, while in the medium-high power bracket the Swedish VOLVO
PENTA and the American DETROIT DIESEL and CATERPILLAR have the highest
market share. The German MAN and MTU are the most popular for engines up to
1000 kW (and above) used on luxury yachts.
In 1990 the Italian market demand increased approximately 45% with domestic
production rising 31% from previous year. Domestic sales surged 39%
chalking up approximately $210 million, while exports rose 27% totaling $367
million. The slight inflection in the 1991 market demand was strongly
covered by foreign producers, to the detriment of domestic ones whose
production dropped an estimated 16%, with consequent sales falling both
domestically (an estimated 23%) and abroad (12%).
2. Imports
In 1990, imports of pleasure motorboats totaled $117 million and accounted
for 36% of the total market. In 1991, they reached $153 million, covering
half of the Italian market. While 1990 imports rose 57% compared to
previous year, in 1991, they increased 37%, which is still obviously
remarkable but less than previous year due to the slight inflection in
market demand, and to the fact that there was perhaps a readjustment by
Italian boat dealers, who had an excess supply after the large increases of
the past. In addition to U.S. suppliers which take the lion's share for
imported craft, countries which have the strongest presence are U.K.
(representing 16.6% of total imports), France (with 12.6%, especially strong
in the sale of pneumatic boats), and Germany (6.5%). Imports are expected
to continue to play a key role in the next few years.
3. U.S. Market Position and Share
Not only is the U.S. Italy's principal supplier but Italy is the fourth
largest customer in size of destination countries, after Canada, Japan, and
Germany. In 1990, U.S. imports amounted to approximately $48 million (plus
54% compared to previous year), representing 41% of total imports, and 15%
of total market. In 1991, U.S. sales in Italy chalked up $58 million (plus
26%), representing 38.0% of total imports, and accounting for 19% of the
Italian market. In particular, the U.S. respectively supplied 37% and 51%
of imported inboard/in-outboard pleasure boats, and outboard motorboats.
Well over one hundred U.S. motorboat manufacturers are present on the
Italian market through local importers/distributors. The latter include
CHAMPION RECORD, INTERNATIONAL YACHTS, MARINA DI VERBELLA, MARINE UNION,
MOTOMAR YACHTING, VITALCO, and many others.
Many consider the U.S. as the leader in the pleasure boating industry.
Reflecting this trend, U.S. firms are traditionally the most numerous among
foreign exhibitors at the renowned annual Genoa International Boat Show.
Many observers at the show have commented that the "stars and stripes"
production costs about 20% less than the Italian one and some members of
UCINA (Italian Boating Manufacturers Association) are really beginning to
fear what is generally looked at as the "U.S. invasion" of the market.
Because U.S. pleasure boat production enjoys such an excellent receptivity,
the U.S. import market share for the next three years is expected to keep up
with an estimated annual real growth of about 5%. It is unlikely however
that it will be able to repeat the amazing performances of the recent past
in the short term in view of the general recession currently affecting
Italian economy with the consequent drop of consumer expenditures in the
more "trivial" sectors.
4. Competitive Factors
Competitive prices, reputation, service, and the ability to meet specific
client needs for the optional equipment as well as timely delivery are the
winning factors for selling U.S. sector products in Italy. A new-to-market
U.S. supplier should strongly consider participating in the annual Genoa
International Boat Show, traditionally held around the third week of
October. It is truly considered one of the best, if not the most
prestigious, boat shows in the world. Since the boat show is held in the
fall, trade participation is very high--drawing under a single roof
approximately 1,400 exhibitors, of which 35% are foreign participants, and
330,000 visitors--and much of the annual business is transacted in Genoa as
dealers begin to build stock for the spring sales season.
F. MARKET ACCESS
1. Import Climate
In Italy, pleasure boats flying the Italian flag with a gross tonnage of
more than 3 tons, an engine power greater than 18.4 kW, and with
unrestricted service, must be registered in records which are kept by the
port authorities. Upon registration, the boat is given an identification
number and a document which allows it to sail. In order to obtain this
registration, the boat has to comply with strict technical safety
requirements, which are checked by means of a survey and tests. The Italian
Naval Register (RINA) is authorized by the Italian Maritime Administration
to carry out the above.
In order to avoid repeating the same tests on all identical boats, the law
allows the above tests to be carried out on a prototype; upon satisfactory
completion of these tests RINA issues an document of approval called
"Homologation Certificate". Regarding the actual procedure, the following
drawings of the boat are to be sent to RINA Head Office in Genoa for
examination and approval: structural drawings, drawings showing engine
installation, fuel and bilge systems, electric plant, and drawings of the
rudder and shaft brackets. Once the drawings are examined, they are
returned to the shipyard's agent, sometimes with recommendations to be
complied with. A physical survey is then carried by one of the RINA
surveyors in the U.S. or directly by a surveyor from Italy. The surveyor
reports his findings to the Head Office in Genoa which, if satisfactory,
issues the Homologation Certificate. As previously stated, the certificate
covers all the mass production of a certain model of pleasure boat.
Prototypes of boat components which must be "homologated" include propulsion
engines, non-metallic parts of fuel systems (including non metallic tanks),
fans and blowers for gasoline motor propelled boats, and fire
extinguishers. There is no compulsory requirement for hull materials.
Once a model has been "homologated" it is no longer necessary to submit all
the others belonging to the same series to the tests already mentioned; it
is sufficient to provide the Maritime Authority with a copy of the
"Homologation Certificate" on the back of which there must be a written
declaration signed no longer by the U.S. manufacturer, but by his Italian
agent stating that the product is built in conformity with the prototype. A
new requirement, dated July 30, 1991, issued by the Italian Maritime
Administration, states that foreign shipyards who wish to "homologate" their
prototypes for sale in Italy must have a legal agent resident in Italy.
This agent must be authorized by the shipyard to carry out the
"homologation" procedure on behalf of the foreign shipyard. Moreover, this
agent will indeed have to sign, on behalf of the shipyard, the statement of
conformity for the mass-produced boats.
For additional specifics, U.S. suppliers should contact RINA (see address in
"Key Contacts" list.
2. Distribution/Business Practices
Domestic producers usually sell directly to the end-users. Imported
products are generally retailed by distributors who carry a full spectrum of
product lines. These importers tend to represent more than one
manufacturer, frequently three or four each one, specialized in a
specific product segment. There are presently approximately 3,000
distribution outlets in Italy. The more prestigious yachts are sold through
brokers.
As previously stated, the Italian government recently announced that only
Italian citizens can act as agents for signing off on the homologation
(standards) compliance documents. This means that factory personnel of
non-Italian boat manufacturers imported into Italy cannot sign off on the
paperwork. Quite often it is the Italian dealers or distributors who signs
off, and these people are Italian citizens. However, if the manufacturer
terminates the Italian dealer or distributor, that party "owns" the
homologation and may charge the manufacturer a royalty for import on behalf
of the new dealer or distributor. Alternatively, the manufacturer can go
through the expensive homologation procedure anew.
The U.S. National Marine Manufacturers Associatin (NMMA) has made a ad-hoc
third party available as the required citizen homologation agent for any
NMMA boat builder, who can act on behalf of multiple boat companies, meeting
their requirements of Italian citizenship for the agent, but without the
downside difficulties of terminating a dealer or distributor who acts as
homologation agent. For further information, U.S. suppliers should contact
NMMA (see address in "Key Contacts" list).
List of Italian distributors and agents can be obtained through the U.S.
Department of Commerce District Offices from our Commercial Information
Management Systems database (CIMS) and the National Trade Data Bank (NTDB).
Intersted companies may also request, through the same channels, and
Agent/Distribution Service (ADS) or a Comparison Shopping Service (CSS).
Both offer excellent value-for-money contacts and market information.
3. Financing
Payments by importers are usually in "cash" or in maximum 60 days with a
letter of credit. It is very difficult to establish the mark-up imposed by
local distributors/importers as it greatly varies, depending on the type of
product. Since U.S. products are in great demand because of their
competitive consumer prices, it is deemed that the average mark-up is not
very high, and that dealers prefer to rely on selling large quantities.
4. Key Contacts
TRADE ASSOCIATIONS
CONSORNAUTICA (Italian Boating Association)
Contact: Dr. Aldo Ceccarelli, President
Piazzale J.F. Kennedy 1
16129 Genoa
Phn: 39-10-589371; Fax: 39-10-5531104
U.S. NATIONAL MARINE MANUFACTURERS ASSOCIATON (NMMA)
Contact: Mr. Jeff W. Napier, President
401 North Michigan Avenue
Chicago, Illinois 60611
Phn: (312) 836-4747; Fax: (312) 329-9815
Concerning homologation requirements and procedure, contact:
RINA - REGISTRO ITALIANO NAVALE (Italian Naval Register)
Contact: Eng. Salvatore Agliano, Director Port Services
Via Corsica 12
16128 Genoa
Phn: 39-10-53851; Fax: 39-10-591877
PUBLICATIONS
NAUTICA
Nautica Editrice S.r.l.
Contact: Mr. Lucio Petrone, Director
Via Tevere 44
00198 Rome
Phn: 39-6-8413060; Fax: 39-6-8543653
VELA E MOTORE
Edisport S.p.A.
Contact: Dr. Giulio Palumbo, Director
Via Gradisca 11
20151 Milan
Phn: 39-2-380851; Fax: 39-2-38010393
BARCHE
Gruppo Editoriale Commerciale S.r.l.
Contact: Mrs. Giorgia Gessner, Director
Via G. Galilei 6
20124 Milan
Phn: 39-2-29002410; Fax: 39-2-6552271
BARCHE A MOTORE
Ed. Portoria S.r.l.
Contact: Mr. Luca Orioni, Director
Via Chiossetto 1
20122 Milan
Phn: 39-2-76000099; Fax: 39-2-782601
INFORMARE
Media Angle S.r.l.
Contact: Mr. Paolo Trimigno, Director
Via M. Melloni 17
20129 Milan
Phn: 39-2-70638283; Fax: 39-2-7384339
MOTONAUTICA
Ed. Renoma S.p.A.
Contact: Mr. Giampiero Muggiani, Director
Via P.E.M. Curie 3
20019 Settimo Milanese (MI)
Phn: 39-2-48915337; Fax: 39-2-48920121
G. TRADE PROMOTION OPPORTUNITIES
Following are the most important pleasure boat exhibits in Italy:
SALONE NAUTICO INTERNAZIONALE (Genoa International Boat Show)
October 17 - 25, 1992, Genoa International Fairgrounds (annual)
1,390 exhibitors; 330,000 visitors
Organizer: Consornautica
Contact: Dr. Aldo Ceccarelli, President
Piazzale J.F. Kennedy 1
16129 Genoa
Phn: 39-10-589371; Fax: 39-10-5531104
NAUTICSUD (International Boat Show)
March 1993, Naples (annual)
Organizer: E.A. Mostra d'Oltremare
Piazzale Tecchio 52
80125 Naples
Phn: 39-81-614922; Fax: 39-81-7258336
Return to Recreational Boat Building Industry Home Page