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SOURCE: USDOC, International Trade Administration
SOURCE KEY: IT
PROGRAM KEY: IT MARKET
PROGRAM: Market Research Reports
UPDATE: Monthly
ID NUMBER: IT MARKET 111101013
TITLE: SPAIN - SPORTS AND RECREATIONAL BOATS - ISA9302
DATA TYPE: TEXT
END YEAR: 1993
UPDATED: 05/14/93
KEYWORDS 1:
| 9302
| BEST|PROSPECTS
| CC469
| COMPETITION
| DISTRIBUTION
| END|USERS
| ISA
| ISA9302
| MARKET|ACCESS
| MARKET|ASSESSMENT
| PLB
| PLEASURE BOATS AND ACCESSORIES
| RECREATIONAL|BOATS
| SPAIN
| SPORTS
| STATISTICS
| TRADE|CONTACTS
| TRADE|PROMOTION
COUNTRY:
| SPAIN
| EC
| EEC
| EUROPE
| EUROPEAN COMM.
| EUROPEAN COMMUNITY
| EUROPEAN ECONOMIC COMMUNITY
| OECD
| ORGANIZATION FOR ECONOMIC COOPERATION & DEVELOPMENT
| ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMET
| WEST EUROPE
| WESTERN EUROPE
| WESTERN EUROPEAN COUNTRIES
TEXT
SPAIN - SPORTS AND RECREATIONAL BOATS - ISA9302
SUMMARY
This article is derived from a report titled: "The Sports amd Recreational
Boat Market in Spain, dated February 1993, prepared by J.R. Carbajosa,
American Embassy - Madrid. This article consists of 11 pages and contains
the following subtopics:
OVERVIEW
STATISTICAL DATA
MARKET ASSESSMENT
BEST SALES PROSPECTS
COMPETITIVE SITUATION
MARKET ACCESS
TRADE PROMOTION OPPORTUNITIES
A. OVERVIEW
As a seafaring nation, shipbuilding in Spain has traditionally been a very
important economic activity. It enjoys some excellent naval engineering
schools. Spain has the third largest fishing fleet in the world and used to
boast one of the largest merchant fleets. There is a much less strong
tradition of pleasure boat ownership. Up to a short while ago, people
believed that only millionaires could enjoy marine sports such as sailing
and boating. At present, more Spaniards have the means to practice all
sorts of water sports.
This report considers that the sports and recreational boat market in Spain
is made up of the following products: sports boats, yachts, sailing and
motor boats, zodiac type vessels, canoes, row boats, and other recreational
boats; engines for vessels; and articles for the practice of water sports
(water skis and surfboards of all kinds).
Imports account for almost 66 percent of the total market. The United
States is the second largest foreign supplier after the European Community.
The domestic market is small but competitive, as they are exporting quite
well to the rest of Europe.
Infrastructure investment is vital for this market. There are only 80,000
mooring spaces available for 125,000 registered vessels. Construction of
new marinas lags behind demand. According to industry sources, the lack of
new mooring space is limiting boat sales by as much 25 percent.
Spain has almost 5,000 kilometers of coast line, as well as a seafaring
tradition plus a favorable climate in which to practice water sports.
Improved standards of living augur well for an expanding sports and
recreational boat market in coming years.
B. STATISTICAL DATA
US DOLS MILLIONS PERCENT GAIN/LOSS
Est. Avg. Annual Real
1990 1991 1992* Growth - Next 3yrs
Import Mkt. 157.1 153.1 151.0 2%
Local Prod. 98.2 106.2 117.6 10%
Exports 32.3 34.9 37.5 12%
Total Mkt. 223.2 224.4 231.1 7%
Imp. from US 44.1 46.2 47.0 7%
Exch. Rates 101.8 103.5 102.0
Future Inflation Rate Assumed: 5.5%
Last Year's Import Market Share*
USA: 30.2% EC: 51.6% Japan: 8.6%
Receptivity Score (1-5): 4 = receptive (The scale goes from 1 = not
receptive to maximum of 5 = extremely receptive.)
U.S. sports and recreational vessels are considered as a good quality
product at a very competitive price. Nonetheless, U.S. manufacturers should
consider local representation to distribute their vessels. A large portion
of U.S. vessels have been imported directly by the end-user after a trip
made to the United States.
Sources: Customs Agency Statistics, Fira de Barcelona Research Study on
Nautical Sector in Spain, ADIN research department.
**Note: data for 1992 is based on industry estimates.
C. MARKET ASSESSMENT
Demand for sports and recreational boats is still rising despite the
economic slowdown. Annual growth estimates through 1996 are around 7
percent; still lower than in recent years. Spain has experienced a very
fast growth rate in the last 30 years for this type of vessels. In 1965,
there were only 700 sports and recreational vessels registered in Spain.
Ten years later, the number of units had increased by 2000 percent to 45,000
vessels. The latest figures available (1991) indicate Spain had 125,000
registered pleasure boats.
Spain enjoys 4,964 kilometers of coastline and fair weather to practice
sailing all year round. At present there are 313 marinas with a total
capacity for 80,000 moorings. The Mediterranean shoreline and the Balearic
Islands have 53 percent of these marinas, which enjoy 84 percent of Spain's
total mooring capacity.
There are two types of marinas clearly differentiated in Spain. Those
streamlined or designed for tourism purposes and those serving the local
population. Marinas in the Balearic Islands and in the southern part of
Spain target the tourist industry. Their mooring capacity is full during
the vacation season, and there is a 7:3 ratio between foreign vessels and
domestic ones.
Marinas in Catalonia and Valencia on the Mediterranean, as well as those
established in the northern Atlantic coastline, are mainly serving clients.
They are usually located close to large urban areas. The vessels moored in
these marinas range from 8 to 10 meters in length; with a few units ranging
from 10 to 12 meters in length. Most of the powered vessels in Spain range
from 6 to 8 meters in length.
The market needs more mooring capacity. Infrastructure investment is
vital. There are only 80,000 mooring spaces available to accommodate
125,000 registered vessels. Construction of new marinas lags well behind
demand. According to industry sources, the lack of new mooring space is
reducing boat sales by up to 25 percent every year.
This market is also burdened by the high taxes which affect every vessel
whose length exceeds 7.5 meters. Beyond this length, ships pay an
additional registration/luxury tax that amounts to 13 percent of the
vessel's value. Normal V.A.T. is 15 percent for all products and services
marketed in Spain and must be paid by the end-user directly. The
registration/luxury tax can be paid by the middleman, but the tax will be
reflected in a higher price to the end-user.
The current economic slowdown is affecting this market in the same manner as
in other sectors. Consumers are more wary about spending their money on
non-essential goods. Nonetheless, end-users in this market are in high
income brackets, and they are usually less affected by economic recessions.
End User profile
Spain's demographics have changed significantly over the last 30 years; its
"baby boom" generation is only now entering its high earning and high
consumption years. Moreover, Spaniards have further to go in catching up to
the living standards of its EC neighbors. While per capita income (in U.S.
current dollar terms) has risen sixty percent over the last five years,
local living standards are still only three-quarters of the European
average. Spain's relatively large market, including almost 40 million
residents and over 50 million visitors per year makes this market very
attractive.
People interested in a sport and recreational boat must have the appropriate
license. In 1991, there were 20,000 new licenses given, with 17,835
renewals. In the first three quarters of 1992, there were 11,669 new
permits issued. In order to get a license, one must attend intensive
training and pass a strict exam. This is another factor that limits sales.
Highest demand for these kind of vessels is found in Catalonia, Valencia,
the Balearic Islands in the Mediterranean, and in Cantabria and the Basque
Country along the northern Atlantic coast line. Madrid is becoming an
interesting market as many of its residents buy small boats to use in some
of the reservoirs that surround the capital.
D. BEST SALES PROSPECTS
- Sports and pleasure boats: motorboats and sail boats with ship length
below 7.5 meters (HC8903)
- Spark ignition reciprocating or rotary internal combustion piston engines
(HC84072)
E. COMPETITIVE SITUATION
1. Domestic Production
Domestic production of sports and recreational boats is quite important in
Spain. Yet, it has not been able to satisfy total demand. Stiff import
competition has aroused this subsector from its sleepy posture in the late
1970's. New manufacturing companies have sprung up and are beginning to
compete fiercely with foreign suppliers. Spanish manufacturers have the
know-how to manufacture top-level products.
Over the last two years, domestic production has grown while imports have
actually decreased. Also, Spanish manufacturers have increased their
exports by as much as 10 percent at a time when the local currency was at
its strongest level. This trend is forecast to continue due to the Fall
1992 peseta devaluations of about ten percent, which have automatically made
Spanish products relatively cheaper and imported goods more expensive.
Domestic sports and recreational boat manufacturing is strongest in yachts
and motorboats with ship length between 7 and 9 meters. The manufacture of
engines (compression piston engines) is the second most important good
manufactured domestically in this subsector.
Despite the fact that domestic manufacturing has grown considerably, the
subsector is concerned about the high interest rates that exist in Spain,
which makes financing new ventures very expensive. This market requires
continued technological innovation in order to keep up with competition.
2. Imports
Imports make up over 65 percent of the total market. The main suppliers to
this market are the European Community member countries with over 51 percent
import market share. Products for the domestic sports and recreational
vessels market coming from the United States make up 30 percent of total
imports, while Japanese goods follow at a distance with just over 8 percent.
By major product line, the EC totally dominates the domestic market for
yachts and small boats that fall under the Harmonized Code 8903 with 54.28
percent import market share. Spaniards also buy most of the engines that
fall under heading 8408 from the EC, mainly Germany, amounting to 55.15
percent of imports. Japanese engines under heading HC 8407 make up almost
40 percent of imports followed by those from the EC, mainly Belgium, with
32.7 percent. Most of the marine complements and accessories that are in
heading HC 9506 come from the EC as well, 61.6 percent of imports.
3. U.S. Market Position and Share
U.S. products account for 30 percent of total imports. Over the last three
years there has been a large increase in the demand for U.S. pleasure
boats. A strong local currency, and a competitive price/quality ratio on
behalf of U.S. products have allowed American pleasure boats to almost
dominate this segment of the market. Sport and pleasure boat imports from
the United States make up 38.24 percent of total imports of heading HC 8903.
There is also an important presence of U.S. engines. Over 24 percent of
total spark ignition or rotary internal engines imported into Spain came
from the United States. With regards to compression ignition engines, close
to 17 percent of imports were manufactured in America. As to other articles
and complements, U.S. products made up 10.3 percent of imports.
Many of the U.S. manufactured sports and pleasure boats have been privately
imported by the end-user after a tourist visit to Florida. A strong peseta
versus the U.S. dollar made it possible to import boats at a less expensive
cost than acquiring it locally. Most of the time, boats were purchased from
a U.S. distributor, instead of directly from the manufacturer. Until last
year, certification requirements were not enforced, so the only hurdle was
to pay the corresponding customs duty and transport the boat to Spain. Even
today, there are advertisements in trade publications about how to buy a
boat in the United States.
There is demand for good quality U.S. products at competitive prices, but
U.S. products in general lack solid distribution channels in Spain. There
is little U.S. manufacturer presence in Spain. Manufacturers have to
establish solid presence in Spain, either through representation or through
joint-ventures with local manufacturing companies. Many domestic companies
would welcome an American firm as a partner targeting the EC Single Market
and bringing in technological know-how.
4. Competitive factors
Price is by far the most important factor. With similar navigational
capabilities, price is the determining factor in this market. This is
especially true for sail boats and other recreational vessels. With regard
to engines, apart from price, after-sale maintenance service is very
important. Quick repair service and available parts are necessary to
compete successfully.
A good distribution network is becoming more and more an essential
competitive factor. Manufacturers from the EC have been investing a lot of
money on improving their distribution network in this market.
F. MARKET ACCESS
1. Import climate
There are both custom tariffs and product approval certification impediments
that limit the free marketing of sports and recreational vessels in Spain.
Also, they are heavily taxed by the Administration. End-users have to pay a
general value added tax amounting to 15 percent, and for larger boats, over
7.5 meter length, there is an extra 13 percent registration/luxury tax.
Industry sources complain that these impediments are affecting the sector's
growth very seriously.
Under the Single Market regulations, custom tariffs for the products covered
in this study are the same for all the EC. This means that boats coming
from other member countries are not levied any tariffs, and only boats
manufactured outside of the EC have to pay these common customs tariffs.
Customs tariffs are as follows:
HC84072
Spark ignition reciprocating or rotary internal combustion piston engines:
between 6.9% and 10%
HC84081
Compression ignition internal combustion piston engines (diesel or
semi-diesel engines): either 0% or 5.3 %
HC8903
Yachts and other vessels for pleasure or sports; row boats and canoes:
either 2.5% or 3.8%
HC95062
Water skis, surf boards, sailboards and other water sport equipment: 6
percent.
2. Certification Requirements
Pleasure boats in Spain, whether manufactured locally or imported must meet
strict certification requirements. These requirements are called locally
"homologation". Pleasure boats must present extensive documentation to the
Inspection Department of the Merchant Navy General Directorate in order to
be "homologated". Once all the necessary documents have been reviewed by
this department, and the boat has passed a navigation test supervised by the
inspectors, the boat can be marketed in Spain. The process takes at least
one month.
The following do not need certification or "homologation" requirements to be
sold in Spain:
- Row boats, canoes, kayaks or similar (including surfboards)
- Water motorbikes
- Motored and sailing ships with an LBD factor below 2
- Pneumatic motor boats, length less than 2.7 meters
- Pneumatic sailing boats, length less than 3.7 meters
The legislation that implements these requirements is spread among several
laws and regulations. This has made enforcement of certification
requirements difficult. Many boats imported in the past got away with
minimum requirements. The General Directorate of the Merchant Navy published
a Ministry Notice in March 1992 (Circular No. 3/92) pointing all the steps
necessary to certify pleasure boats in Spain. Strict implementation began
in June of last year.
The US&FCS in Spain managed to work with local authorities to obtain
recognition for U.S. manufactured pleasure boats that hold certification
from the National Marine Manufacturers Association (NMMA). This applies to
pleasure boats with total length below 15 meters. The Inspection Department
of the General Directorate of the Merchant Navy accepts the NMMA documents
to substitute those required by the 3/92 regulations for this kind of
boats. Nonetheless, there must be a unit present in Spain for the
navigation tests.
3. Distribution/business practices
Distribution patterns in this subsector change depending on the products
marketed. Recreational boats as such, that is sailing boats from Optimist
class onwards, cruising sailing boats, yachts, motorboats and pneumatic
boats (zodiac type) are distributed mainly through distributors and
represent 75 percent of units sold annually. The remaining percentage of
boats sold annually are marketed directly from domestic manufacturer to
end-user (20 percent) and from foreign manufacturer to consumer (5 percent
of units). The majority of boat distributors, 80 percent of units sold
every year, buy from manufacturers and re-sell to final user. Remaining 20
percent of boats are left on consignment by the manufacturer for the
distributor to sell.
The 20 percent of boats sold by domestic manufacturers to end-users are
usually small regatta sailing boats, 420, 470, Europa, etc., and for large
boats over 15 meters of length. These large boats are built directly by
shipyards, and the end-user typically makes the order himself.
The other products reported in this study are not sold directly to
end-users. The distribution chain is respected. Usually these products are
sold by distributors to specialty retail stores.
4. Financing
The general rule in this market is the 90 day payment turnover. Regarding
boats, the common practice is that payments are delayed if the distributor
has not sold the boat.
Distributors have their own financing or have special agreements with banks
to finance boats over US$10,000. In theory boats can be mortgaged like a
house, but in practice no bank accepts this risk any more.
Large recreational boats, on the contrary, are financed by the end-user.
The customer contracting with a shipyard to build its boat must make payment
advances. (This refers to boats that cost over US$1 million.)
5. Key contacts
A full list of government and private contacts in the recreational boat
market can be found in Appendix 1. This list contains the addresses of the
Government agency in charge of certification requirements, of useful trade
associations that can provide information about this market, major
importers, and related specialized publications.
G. TRADE PROMOTION OPPORTUNITIES
There is a large trade fair on recreational boats and complementary products
held annually in the last week of November in Barcelona. This is organized
by the city's trade fair Authority and by the domestic Association of
Maritime Industries (ADIN).
The trade fair's address is the following:
Fira de Barcelona
Salon Nautico Internacional
Avda. Reina Maria Cristina s/n
E-08004 Barcelona, Spain
tel: (34-3)423-3101
fax: (34-3)423-8651
The U.S. Department of Commerce and the U.S. and Foreign Commercial Service
in Spain offers the Gold Key Service, a custom tailored, appointment-setting
program to introduce a company's products in Spain. This service has
allowed many firms to identify and establish commercial relations with
qualified local companies. For further information please contact:
Commercial Attache
US&FCS Madrid
PSC # 61, Box 21
APO AE 09642
tel: (34-1)577-4000
fax: (34-1)575-8655
Appendix: KEY CONTACT LIST
Government
Ministerio de Obras Publicas y Transportes
Direccion General de la Marina Mercante
Inspeccion General de Buques
Contact: Mr. Antonio Calvo Anton, General Inspector
E-28014 Madrid, Spain
tel: (34-1) 580-1400/580-1450
fax: (34-1) 523-4120
Trade Associations
Asociacion de Industrias Nauticas (ADIN)
Contact: Mr. Miguel Company Martorell
L'Escar 5,
E-08039 Barcelona, Spain
tel: (34-3) 310-7948
fax: (34-3) 315-4259
Importers
RONAUTICA S.A.
Contact: Mr. Rodrigo Andrade
Puerto Deportivo de Vigo
Apdo. Correos 249
E-36200 Vigo, Spain
tel: (34-86) 431-402
fax: (34-86) 434-472
NAUTICA MAR MENOR
Contact: Mr. Pedro Mirete
Avda. Artero Guirao 19
E-30740 San Pedro del Pinatar (Murcia), Spain
tel: (34-68) 182-050
fax: (34-68) 184-018
HARRY WALKER (Div. Nautica)
Contact: Mr. D.P. Garcia
Aragon 105
E-08015 Barcelona, Spain
tel: (34-3) 226-3812
fax: (34-3) 226-3812
MAVERICK BOATS ESPANA
Contact: Ms. Catherine
Puerto de Rosas
E-17487 Ampuriabrava (Girona), Spain
tel: (34-72) 452-354
fax: (34-72) 452-354
MARINE DISTRIBUTORS S.L.
Contact: Mr. Chris Collman
Muelle de Levante
E-07701 Mahon (Menorca), Spain
tel: (34-71) 366-144
fax: (34-71) 366-144
ALCORDE S.A.
Contact: Mr. Eduardo Falcon
Juan Rejon 67
E-35008 Las Palmas (Canarias), Spain
tel: (34-28) 246-288
fax: (34-28) 249-526
DEPOSITOS NAUTICOS DE CANARIAS
Contact: Antonio Macias
Mendez Nunez 106
E-38001 Santa Cruz de Tenerife, Spain
tel: (34-22) 270-962
fax: (34-22) 270-966
MARINA 2001
Contact: Mr. Abelardo Garcia Linares
Avda. Moscatelar 5
Poligono La Hoya
E-28700 San Sebastian de los Reyes (Madrid), Spain
tel: (34-1) 654-4256
fax: (34-1) 654-4256
METROPOL CASTELLDEFELS S.A.
Contact: Mr. Jose Donatiu
Autovia Castelldefels 104
E-08860 Castelldefels (Barcelona), Spain
tel: (34-3) 636-0310
fax: (34-3) 664-5155
MOTORMASO S.A.
Contact: Mr. Enrique Maso
Autovia Castelldefels Km. 9
Apdo. de Correos 53
E-08830 Sant Boi de Llobregat (Barcelona), Spain
tel: (34-3) 630-5533
fax: (34-3) 630-5533
INTER FISH
Contact: Mr. Salvador Santiago
Pintores 2, bajo izda
E-28037 Madrid, Spain
tel: (34-1) 306-7858
fax: (34-1) 306-4906
BOTE Y VELA S.L.
Contact: Mr. Miguel Soldevilla
Sartena Auzoa 48F
E-48940 Leioa (Vizcaya), Spain
tel: (34-4) 423-0806
fax: (34-4) 424-7334
MARINA MARBELLA S.A.
Contact: Mr. Robin Tupper
Puerto Pesquero
E-29600 Marbella (Malaga), Spain
tel: (34-52) 777-098
fax: (34-52) 822-737
ISLAND PACKET YACHTS
Contact: Mr. Brian Livingston
Paseo Saralegui 50
E-07470 Puerto de Pollensa (Mallorca), Spain
tel: (34-71) 530-426
fax: (34-71) 530-426
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