Asia takes aim at Europe in luxury yacht building

By Doug Young

KAOHSIUNG, Taiwan (Reuters) - Fast-moving Asia is vying for a bigger share of the multi-billion-dollar luxury ship market serving the rich and famous.

Led by Taiwan and increasingly China, Asia has narrowed the gap with the West in recent years, though it still lags Europe in the race for a market where individual yachts can sell for tens of millions of dollars.

Asian yacht-builders offer prices that average about a third less for Taiwan and up to half as much for China compared to boats built in the West.

But low prices sometimes come with lower quality, especially from China, and less individuality, say industry watchers.

"Taiwan is already a good market with experience with building yachts and China could be the future one," said Francesco Frediani, vice president of sales at Italian luxury yacht maker Riva Yacht, which counts actors Nicholas Cage and Sophia Loren among its clients.

"They are growing their expertise at the moment but in terms of handling boat-related problems, Europe still owns the expertise," he said.

Taiwan and China are Asia's two current leaders, with about 100 orders on the books this year -- three-quarters of those for Taiwan -- for yachts of 80 feet or longer, according to industry tracker ShowBoats International. The figure was up sharply from 2005, when the pair had about 60 orders combined.

While growing, those numbers still trail well behind Italy, the world's leader with more than 400 orders on the books alone this year, and the United States, with more than 100.

"Taiwan's boats sell good, people like them," said Andy Ye of Floating Life, a Switzerland-based boat manager of super yachts that recently opened a Shanghai office.

"But in terms of innovation, the Italians or the Dutch or the French have more innovative designs. They set the trends, Taiwan follows."

SWEATY WORKSHOPS

The gritty workshops where Asia makes its super yachts contrast sharply with the glitzy finished products.

A sprawling, hanger-sized building hums as sweat-soaked laborers work inside the steel shells of four 90-foot yachts being built by Jade Yachts in the south Taiwan port city of Kaohsiung, where the industry is based.

These massive hulls filled with sawdust will eventually end up as swanky, multi-leveled yachts with rooms for 12-14 guests and trimmings such as glass elevators, Jacuzzis and entertainment centers with state-of-the-art audio and video systems.

Jade kicked off its mega yacht business in 2005 with a splash by re-outfitting a massive 210-foot research vessel into a luxury craft, reportedly for high-end fashion house LVMH group.  Continued...