Expensive Italian boats are now considered extravagant as local yachting culture changes tack

Luxury Italian yachts that sell for around 10 million yuan ($1.6 million) are falling out of favor amid China's economic slowdown and the ongoing crackdown on graft, and more affordable yachts from the United States are cruising in to plug the gap.

During the recently ended China (Shanghai) International Boat Show, Silver Marine (Shanghai) Co Ltd sold two American yachts. It expects to complete sales of a few more this month.

The company specializes in surfboards but is starting to diversify. Even though yachts make up just 5 percent of its annual sales, it is hoping to cash in on this burgeoning market.

As yachts from the US tend to go for between 300,000 yuan and 1 million yuan, they are proving the new normal among Chinese consumers, according to Wang Jian, marketing director at Silver Marine.

"The trend was very noticeable at the beginning of the year when the US economy started to pick up momentum. The boom in sales of domestically produced yachts in the US has also propelled growth in sales in China," she said.

Yachting has been a way of life in the US for decades but is new to China. According to statistics provided by Sanya Yachting Association, one in every 14 people in the US owns a yacht, with the middle class claiming 90 percent of the cheaper and smaller models in the country.

It is now becoming popular in China for several families to band together to buy one American yacht that they can share, according to Wang.

"Chinese consumers' increased interest in cheaper and smaller US yachts also reflects the rising popularity of water sports here," she said.

US fishing boats that retail for 4 to 5 million yuan are also selling well in China, said Liu Qi, marketing manager of Dalian Bluewhale Yacht Club.

"Some customers are still buying boats just to entertain their guests and friends. But more are now snapping them up for their own personal enjoyment," she said.

Most Chinese yacht owners join clubs in subtropical Sanya, a tourist city in South China's Hainan Island, which ranks as a province. Dalian Bluewhale has also set up a branch office in Sanya to better serve its customers there.

"People have long misunderstood just how much it costs to maintain a yacht. They think it's more costly than it really is," said Liu. "It's actually a lot cheaper than maintaining a luxury car."

A yacht that sells for 5 million yuan will cost 10,000 yuan a year to keep in good shape, whereas a luxury car of equal value would cost 10 times that much, she said, adding "a yacht also promotes a much healthier lifestyle."

The central government has thrown its support behind the development of the Chinese yacht industry and is now encouraging the construction of more marinas, according to an outline for national tourism and leisure for the seven years following 2013 that was released by the State Council that year.

"For a long time after yachts were introduced to China, people misunderstood them as symbols of personal wealth and social status," said Yang Xinfa, deputy secretary-general of the China Association of the National Shipbuilding Industry.

"Some companies just used them for business receptions. As a result, yachts were mistakenly seen as symbols of a luxury lifestyle," he added. "But the fact of the matter is that they are not viewed in this way among European and US consumers, many of whom just consider them part of a healthy lifestyle."

He said views in China are changing as sports like fishing and sailing take hold.

"The gap between Chinese and Western consumers is narrowing," he added.

shijing@chinadaily.com.cn