Written by Nautech | Giuliano Luzzato
TO GAIN A BETTER INSIGHT AND UNDERSTANDING OF THE LUXURY CHARTER INDUSTRY SPECIFICALLY CONCERNING SAILING SUPERYACHTS, WE SPOKE WITH EXPERTS RAFFAELLA YEUILLAZ AND BENEDETTA GIUSTO
The charter manager handles the yachts exclusively entrusted to him by the owner, acting as the authorised “Central agent” to whom everyone, including other agencies, who wishes to charter that specific yacht must turn. On the other hand, the “Retail Charter Broker” keeps the connection with the customer, by finding the most suitable solution for the customer’s requirements. Both these roles can often co-exist in a single company, as is the case with Pegaso: an Italian company active all over the world, providing services to an international clientele.
Whereas chartering a motor superyacht shares many affinities with renting a luxury villa, sailing introduces some specific peculiarities. On top of that, Pegaso has been ahead of the game on the Charter Management business model for a boatyard brand which, while certainly not new, is evolving from a supplementary service into a core ingredient of the brand’s integrated service. We spoke extensively with Raffaella Yeuillaz, Charter Manager, and her colleague Benedetta Giusto at Pegaso.
You are an established brand. What can you tell us about Pegaso?
Pegaso and Southern Wind shipyard share the same mother company; the first offers ancillary Yacht and Charter Management services primarily – but not exclusively – to Southern Wind owners. In terms of chartering, because of its long-standing and close partnership with the shipyard and customer care, Pegaso is able to follow the lifespam of each Southern Wind yacht first hand right from their concept. As a result of this, along to the quality of its boutique charter service provided, Pegaso over the years has become the perfect reference for all those who wish to charter a Southern Wind. This means that there is no yacht or crew we do not know in depth, enabling us to pinpoint the best solution for each customer request and profile.
Do you see a trend in this direction from other yards as well (both sail and motor)?
Of course: a few other brands, such as Oyster Yachts and Nautor Swan, have an approach very similar to ours. But there is still a certain dispersion of the charter fleets of the various yards, both sailing and motor, among the numerous charter agencies tout court.
If a brand wishes to undertake Charter Brokerage and Management, however, it requires a critical volume of yachts to manage: it is a highly specialised work and it requires a fully dedicated team of professionals that would not be justified for just a few units. To date, 11 yachts from our boatyard are officially available for charter.
With respect to the pre-pandemic period, what is the increase in charter demand?
The demand has increased considerably since 2021, in the range of 50%, far more than the current supply capacities; also, after the pandemic, about 10% of the customers we had on board were on their first ever boat holiday experience.
We have more demand in relation to the available boats or available weeks. Moreover, the owners themselves sometimes choose now to spend longer time on board than before.
Will the trend for the next 2-3 seasons stay stable, or continue to increase or decrease?
We believe that demand will stabilise to match supply.
Yet we notice increasingly early bookings, frequently from year to year, not just in the American market – which is historically accustomed to this – but also of the European market, mindful of the sell-out of the recent past. On average, both Mediterranean and Caribbean peak seasons are now reserved 6 to 9 months in advance.
Which differences between an M/Y and an S/Y client?
The motor yacht customer – who seeks comfort and fast travel – is less interested in what happens between point A and point B and may disregard whether his villa floats or has foundations.
On the contrary, sailing customers are often sailors, and their main expectations include the enjoyment and flavour of sailing, the planning of the itinerary and the flexibility to change it according to the weather conditions. The connection with the sea and the natural elements is essential, the the request to explore bays and destinations off the beaten track is another constant. The relaxation, fine cuisine and water sports complete the list of “ wishes”. The sailor client is typically very private, he likes luxury yet not ostentatious.
Has the request for S/Y in place of M/Y increased?
We are witnessing a gradual approach and shift, with increasing interest in yachts over 35 m, where the interior and exterior volumes offer greater space. This year the Pegaso-managed charter fleet has rapidly and ahead of schedule fulfilled its availability for the season, both through bookings from regular customers and new clients, some of whom came from new regions (Bulgaria, Saudi Arabia). An interesting side note: the rising fuel prices may be a factor that, in combination with increasing environmental awareness, may lean steadily towards sailing, which is green by definition.
A few examples?
For the first time this year, we have brought in two groups of customers from the motor yacht to charter a sailboat: SW82 Ammonite. A family from Italy also decided to experience this type of holiday in order to enable their two 10-year-old sons, who have just concluded a three-week sailing programme in Caprera, to continue their sailing experience on board a superyacht. Furthermore, 3 pairs of Saudi Arabian clients enjoyed a week sailing together with their father’s 40m M/Y.
Is there greater demand for new-build boats than for those that have been sailing for some time?
The new generation yachts are very much in demand. Recently SW105 Sørvind, before being launched in Cape Town in April 2022, was already booked for the summer season in the Mediterranean.
However, the reputation of a yacht and its crew within the charter industry may occasionally dominate regardless of the date of launch, assuming that very high standards of maintenance or major refits are carried out.
Do returning customers usually choose the same boat for their stay, or is it more due to their loyalty towards the broker?
On both counts. Approximately about half of these clients enjoyed their time on a particular yacht – and it is often the crew that makes the difference – hence they wish to repeat the same experience, with the benefit of being able to change location. Other clients wish to experience other vessels and trust our suggestions to meet their expectations that we acquired over the years.
What is more important, the experience on the specific boat or the connection with the captain and crew?
The crew constitutes more than 50% of a charter’s success; it starts first by selecting the yacht, which must never let you down, but then the crew makes the difference.
At Pegaso we really emphasise this aspect and work closely with both our captains and crews, ranging from setting guidelines codes – as if to establish a standard SWS charter crew – to fostering the captain/crew/client interface well in advance of the start of the cruise. For instance, we arrange video calls in which captain/stewardess/chef and client first meet each other and start interacting about the cruise organisation. A variety of topics are addressed, ranging from food preferences, galley, itinerary and expectations. The moment they encounter each other on board, it won’t be the first time. We have excellent feedback on the efficiency of this system.
Have you got requests to be with the same crew?
More than anything else, the client inquiries about the yacht in advance, seeking to confirm that all or part of at least the same crew is on board. If a key crew member has switched vessels, it is possible that the client may choose to join him/her on board the new yacht on which he/she is embarked.
Which are the target groups of your customers?
We can find either former owners who have sold their yachts and prefer this option or prospective owners who are trying out the experience before committing to a major purchase. Also families with young children or teenagers: we often see them grow from year to year as they continue to repeat the experience. Back in 2021 on SW100 Freebird we hosted a family with two children aged 4 and 6, who spent a month on board sailing round trip from the Balearic Islands to France, Corsica and Sardinia for a total of 1400 miles. We had three generations on board, where the grandmother was the main customer, couples of friends in their senior years, but also groups of business partners and lifelong friends.
Which areas are you active in? Are there new trend areas in demand?
The Mediterranean and the Caribbean remain the hottest destinations and with the highest concentration of yachts. In some years there may be more demand for one area in one country than for others: for example, this year (summer 2023) we saw a surge in requests for the Amalfi coast, Sicily, Croatia and Greece, where only yachts with a charter licence can operate (a licence is not easy to obtain and very expensive).
In the off-season, the Balearics invariably work well, we have charters booked until October. In relation to the Caribbean, the Grenadines, Antigua and the British Virgin Islands are a classic.
New destinations follow the yacht owners ‘around the world’ sailing programmes: this year SW102 Farfalla is in Polynesia and from next year SW94 Aragon and SW100 Acaia will start their round-the-world voyages.
SW105 Sørvind is planning a summer of cruises in Norway and Northern Europe in 2025. Alternating with their respective owners, charter clients will thus also be able to reach unconventional destinations in addition to the more classic ones.
What about the average time spent on board, the miles travelled, and the most common requests?
On average, the length of stay is 10 days, rarely less than 7 or more than 2 weeks. The weekly average distance travelled is around 200 miles. With regard to demands, some are now a taken-for-granted standard, from high-end chefs to water toys such as e-foils and seabobs. Occasionally, we had requests for nannies and masseuses.
Some clients do their charters before placing the order with the shipyard. Have you got any numbers you can share?
Since 2019 to date, 7 charter clients have become SW owners, 3 of them with a new build and the others brokerage. The experience on board can be repeated on the same yacht or others, if there are still aspects to be explored.
Can chartering be considered a new marketing strategy for the shipyard?
Surely, relying on some SWS available on the charter market allows a wide range of players to have an authentic SWS experience on board, so it’s certainly a good promotional driver. Barely more than 300 people were on board a SW between summer 2021 and summer 2022, with an average presence of six guests per boat. Those guests have not visited the boat at a boat show for 30 minutes, they have lived and sailed in it for at least 7 days. The feedback from them is really important; fortunately, it is always positive.
For many owners, chartering their boat is part of their mentality as a businessman. Should this choice already be envisaged when buying and planning the boat? What are the differences compared to private use only?
It is advisable to consider this use right from the beginning, as the owner of the SW105 Sørvind, for instance, has planned.
Think of a charter-friendly layout with a functional distribution of guest space, for example modular cabins with single beds that can be converted into doubles, without excessive discrepancy between the master’s cabin and the others, dedicated indoor and outdoor living areas, bar corner, various amenities, ample storage space, separate crew area with professional galley.
Last but not least, the yacht must be registered as commercial and built in compliance with the codes of the various flags. A commercial boat must perform a certain number of charters per year and the UBO (Ultimate Beneficial Owner) must necessarily charter the boat in order to use it. It is also necessary to set up a rather articulate structure of consultants and tax representatives to follow all the paperwork.
To sum up, private use is more flexible, but it does not make it possible to recover the running costs that charter activity can help to offset, especially in periods when the owner has planned not to be on board anyway.