Vikas Gupta wonders whether the growing trend of Yachting is indeed a needed utility, a business or just a status symbol?
The view from Gateway of India has turned to be “Yacht view” rather than sea view in recent years. With highest GDP growth and rising income levels in India over the last two decades, there is a visible change in lifestyle and luxury products in Mumbai.
A huge fleet of Yachts and speedboats signify the arrival of luxury lifestyle at Mumbai shore. Sales of Yachts, costing between 5 -300 crores has moved north in the past decade and is expected to increase further with celebrities like Mukesh Ambani, Cyrus Mistry, Vijay Mallaya, Anand Mahindra, Bajaj family and many others buying some real expensive ones.
According to Aashim Mongia (MD) of West coast Marine, “When we started in 1994 we could see 4-5 private boats and now there are around 300 or so of which 60-70 that can be categorized as yachts. As far as potential is concerned, Japan uses 48% use of waterways for transportation, China 45% and world average is 30%. India is still at 3%”.
An interesting aspect of the Yacht segment growth is that landlocked Delhites are proud owners as compared to Mumbaikars that preen about the city’s proximity to sea. According Nelson Dmello (VP Navnit Marine) “ There are businessmen even from Delhi who buy yachts and park it in Goa as Delhi is landlocked and Goa is the entertainment hub with cheap alcohol and parties”
What is interesting is that despite the high cost and seen as a depreciating asset with an average life of only 10 years, the demand has not ebbed. What drives the demand for this ultra luxury hobby and is it worth it? Is renting business commercially viable? Practically, should you buy one or rent one to fulfill your hobby?
According to Simon Murthaty COO of Ocean blue(Dealers and service providers for charter yachts) ,” There is a lot of interest in the younger generation but there are no supporting infrastructure and complicated layered permission and regulations which has kept this industry lagging. Once this cycle starts and people start buying, there will be a chain-link reaction and others will buy because their friends or family has it”
People look at utility value of the product when they plan to buy an expensive asset like yacht and right now utility is limited to travelling from Mumbai to Mandwa, which is the closest place that has some marine infrastructure.
And yet, that has not stopped the trend of having Yachts as must have. According to Shashank Jadhav, who has served as senior sales manager in a leading company for 10 years, “It’s an expensive hobby, but over the period of time when people look at the cost spent on maintaining yacht without little use, they start renting it and earn enough to recover monthly operating and maintenance costs”
To give you an idea, the operating costs is around 2, 00,000/- per month which includes crew salary (Master – 50,000 to 100,000) and (Seaman- 20,000/-), anchorage charges 30,000 to 60000 per year and other maintenance charges. Moreover from June to October, all boating activities are closed due to rains which mean it can be monetized for only 7 months in a year.
Even though buying one is very exorbitant, one can always rent it. According to Varun Shah (who had rented a yacht recently), “I would personally find it easier and much economical to rent. I will have no fixed costs and I can travel in a new yacht every time I need to travel”.
When asked if people buy it for commercial business of renting it Simon said,” it’s not a rental business, it’s a hobby. In some cases the elite owners do not have time to go to their yachts even once a month”. It is indeed a status symbol.
Yacht Rental Cost
Also, Yachting or partying on Yachts need not be luxury affordable to a selected few. According to Divya Chadha from A Klass Apart (an event management company that specializes in yacht parties) “We are still at the stage of building awareness. Yacht partying is perceived to be very expensive which is not true. The cost per person ranges from Rs 1500-3000 which is less than what you would spend on a luxury sea facing restaurant. Off shore partying is like adding a twist to the party and I think it has not realized its full potential. People are still opening up to the concept. We have held several marriage proposals and birthday bashes especially for sundown parties which offer the best view.”
If you really want give a push to this interest, you may even opt for full time ‘sailing course’ which is of 2-3 months. You may then even upgrade for certificate to become a master, which is an extension of this course. If you think you are alone and don’t know how and where to start, you can even enroll for sailing clubs like Colaba sailing club who have a fleet of 9-10 boats. This 76 years old club has an annual membership fee of Rs71, 000 and you can book their fleet for sailing throughout the year. They also hold competitions and social events with Bombay sailing association and Royal Bombay yacht club.
Weather renting or buying, it is certainly a hobby that is missing from Mumbaikars fun basket. An interest that must be cultivated to bring you close to nature. We are almost deprived of this medium only because of some basic support base. According to Aashim, “We are hopeful that the Sagar Mala (transforming Ports into modern world class ones), our Honorable prime ministers pet project will bring about a sea change in the way this industry works and may help in its transformation. Look at how our airports have changed in the last decade, why can’t we have that for ports?”
