Portrait of Tammy Strobel
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VISITING THE SHIPBUILDING hub of Kaohsiung in Taiwan, China last summer was a real eye-opener. First of all, this coastal city on the southern end of the island is a pretty cool place to explore with its excellent street and night markets, delicious food, vibrant culture, spectacular temples and scenic places to visit.  

Taiwanese boatbuilders have produced thousands of yachts since the 1960s (sailboats and motor yachts), but mainly for international markets. As the story goes, American GIs stationed in Taiwan placed the first orders for the well-built local boats to export to the United States. 

During a media tour for the Taiwan International Boat Show (Mar 10-13) organised by the Taiwan External Trade Development Council (Taitra), journalists from 13 countries are shown around the shipyards of builders such as Horizon Yachts, Dyna Yachts and Grand Harbour Yachts, as well as suppliers such as propulsion system maker ZF and Asia’s largest marine hardware maker Aritex. 

Having visited many shipyards and suppliers in the Netherlands, Italy, Germany and elsewhere around the world it is interesting to see the differences with their Taiwanese counterparts. The first thing I notice is that the most of the Kaohsiung facilities seem quite dated, and dirty. However, the quality of the finished products is excellent. 

This port city – the second-largest in Taiwan – is blessed with nearly year-round sun and geographic conditions ideal for yacht manufacturing. It contributes 80 percent of Taiwan’s overall yacht production value. 

According to Zhang Xue-qiao, Secretary-general of Taiwan Yacht Industry Association (TYIA), Taiwanese yacht export orders increased by 13% from 2013 to 2014, which is the first double-digit growth seen since bottoming out at US$144 million in 2010 in the wake of the 2008 global financial crisis.

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The 120 Taiwanese yachts exported in 2014 was a 13.67% decrease from the 2013 level of 139, but the total value they generated exceeded the US$152 million of a year earlier, which Zhang attributes to the above-average length of exports – a result of the national policy of manufacturing high-value, larger-sized yachts that are presumed to be relatively immune to economic fluctuations. 

With Japan, Singapore, Hong Kong, the US and Canada being its top export destinations, Taiwan’s yacht industry will emerge from a nearly eight-year slowdown and “reach the high level of US$200–300 million in annual export value” as long as the European economy keeps showing encouraging signs, Zhang believes. 

Currently, what worries yacht makers most – especially those in Northern Taiwan – is a shortage of labour. Even with a NT$40,000-plus monthly salary (about US$1,220), according to Zhang, employees are difficult to find and there is a high turnover rate among young employees. 

This has prompted TYIA, which is already partnering with the National Dongshih Industrial High School in a vocational training effort, to further seek the Ministry of Education’s assistance in corporate-school collaboration to foster well-trained yacht sales and marketing professionals. 

The upcoming yacht marina at Xingda Harbour is expected to significantly drive continued expansion of the industry, although it was initially intended to be part of the South Star Yacht Industrial Park, which raised environmental concerns that led to delays in the project and subsequently resulted in relocation.

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The NT$2.2 billion project is expected to feature recreational yachting facilities – along with shipyards, clubs, and inland resorts – and epitomise the entire yacht supply chain from manufacturing and sales to services. 

To meet market trends, local yacht makers require larger and more modern shipyards and dry-docks close to water to build yachts, superyachts and megayachts that can be real-world tested before delivery. 

Responding to this demand, the Kaohsiung City Government is developing the South Star Yacht Industry Park (SSYIP) on reclaimed land to house well-integrated supply chain of yacht makers, suppliers of marine hardware, yacht parts and components and logistic operators to boost the industry’s overall competitiveness and create more jobs in the city. 

To enhance the industry’s sustainable development and become Asia’s luxury yacht manufacturing base, the park will feature not only industrial clustering, but also eco-friendly infrastructure and complete facilities including solar power generation, large shipyards, and boat launching facilities to meet manufacturers’ requirements. 

Moreover, the park is near the Kaohsiung Port and Kaohsiung International Airport, with roads to be built to help the yacht makers enhance operating efficiency and cut transport costs. 

Adjacent the Kaohsiung Port Container Centre, the SSYIP is spread over 110.82 hectares and will be divided into five zones for administration, yacht building, support manufacturing, on-water testing, and public facilities. 

The island’s most prolific and well-known builder Horizon Yachts, part of Horizon Group, was founded in 1987 by CEO John Lu, who has a deep-rooted passion for boats and a love of the ocean that stems from childhood. Lu was named Personality of the Year at the Asia Boating Awards last year. 

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The Taiwan yacht industry was prospering when Lu created Horizon. However from 1987 to 1997, Taiwan’s yachting industry encountered an unexpected recession. During this time Horizon, unlike many other companies, adjusted its business strategy and in 1989 shifted target markets to Europe, Australia and Asia. Horizon then redeveloped its yacht manufacturing processes, adhering to stringent yacht quality and safety requirements in Europe and Japan, and earned a reputation for building yachts of exceptional quality and value. Horizon’s continual progress and advancements not only established a solid yacht building foundation, but also resulted in the company’s ability to prevail over Taiwan’s economic recession. 

Lu continued expanding Horizon and from 2000 to 2005 he restructured Horizon’s other three companies – Atech Composites, Vision Yachts and Premier Yacht. The original Horizon Yachts company was also redeveloped to build a more comprehensive range of yachts. 

Horizon has been honoured as Best Asian Motor Yacht Builder for 10 years in a row at the Asian Boating Awards organised by Asia-Pacific Boating and China Boating magazines, and is the first and only Asian member of SYBAss (Superyacht Builder’s Association). 

TIBS 2016 exhibitors will include Taiwanese builders such as Horizon, Ocean Alexander, Global, Tayana, Novatec Yachts, Monte Fino, Aquabay, President, Ruby, H.Yacht, and Dyna Yachts. 

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An array of boats ranging from 15 to 120 feet will be showcased – including canoes, sailboats, motor boats, sports cruisers, and luxury yachts. 

Not only will the upcoming boat show at the Kaohsiung Exhibition Centre and adjacent Horizon City Marina feature local builders, it will include well-known brands from countries including the UK, Sweden, Italy, and the US through local retailers and distributors such as Princess Yachts Taiwan, Delta, ZAR Formenti, Galeon, Quicksilver, and Lohas Ocean Leisure (Bavaria). 

The show is set to feature 32 yacht brands, more than 160 boat companies, and accessories or related service providers by exhibitors from nine countries. In addition, 60 luxury yachts, accessories, and equipment will be showcased indoors, outdoors, on land, and on water. 

At the first show in 2014 an estimated 2,000 foreign buyers and more than 70,000 visitors attended the event, according to the organisers. The show helped generate NT$5.2 billion in new transactions and set off a wave of interest in yachting in Taiwan. Most foreign buyers came from Mainland China, Japan, Hong Kong, the UK, Singapore, Canada, Germany, the Philippines, and South Korea. 

The Taiwan International Boat Show is the largest indoor boat show in Asia. This year it will include six exhibition areas: Yachts and Boats, Equipment and Accessories, an International Pavilion, Maritime Service Area, Water Sports and Recreation Area, and Luxury Corner. 

In addition, the show will debut an outdoor yacht exhibition on the grounds and at Horizon City Marina.