Q: I am thinking about purchasing a yacht. In doing my research I have seen a fractional ownership concept called Yacht Plus. What do you think of the long term sustainability of this concept?
Lorre: Fractional ownership of private jets has been a great success lowering the cost point that individuals could enter the private aviation market. The concept was created by NetJets. The planes interiors are all identical so there is no difference in the quality of the different aircraft customers use. The entrance point for someone is about 50 flying hours and $50 Million in liquid assets.
This same concept has been attempted before in the yacht industry and has always failed. Partly because the jet is a mode of transportation and a yacht is more of a place of living. It is more agreeable to share the former with other unknown individuals but disruptive in a living situation. It means that you can’t leave belongs on the boat and you have to pack up like a hotel. If you are going to do this….it is just easier to charter and you have more flexibility than in a timeshared yacht experience. The new yacht plans for Yacht Plus have a very attractive look, but these issues, plus a long list of others, make it a risky investment proposition. Once everyone puts their money in, it is 2 years until the boat is build.
Q: Is having a yacht or a private jet considered more of a luxury?
Lorre: That is a good question and one that luxury marketers need to understand. Studies show that in the US, having a yacht is considered more of a luxury and a private jet more of a necessity. This may have something to do with the large amount of space the US takes up and travel for business or pleasure takes up a large chunk of our time. In Europe they see a yacht as more practical and the private jet as more of a luxury, however this is rapidly changing and private aviation is becoming much more common place, like it is in the US.
Comments