U.S. Flag Group Owned Superyachts; A New Market for Designers, Shipyards and Ship Managers

The market for superyachts has been growing at rates above 15% for several years (Beckett, 2007) and has represented a significant large powerboat market. One growth area in this market is vessels designed for group ownership, because as the individual cost of ownership decreases, people with less wealth are brought into the market. Since wealth follows a power curve, a five fold decrease in ownership cost represents far more than a five fold increase in potential owners. However, group ownership requires significant changes in the paradigm of use, design and management, including significantly more use in U.S. waters, meaning U.S. flagging and inspection becomes more advantageous (in part due to reduction in tax benefits of offshore flagging). Therefore group-owned U.S. flag superyachts potentially represent an opportunity for designers, management companies and builders, but have significant regulatory constraints on design and operation that have to be considered.