Will Brexit Affect The Yachting Industry?

Last week was all about one of the biggest events in the modern history – the referendum in the United Kingdom over leaving the European Union. Now that Brexit is a reality, analysts are trying to predict how it will affect economies, industries, and people all over the world.

The yachting industry is very well established in the U.K., with builders such as Sunseeker, Oyster, and Princess Yachts, and designers such as Winch, Dixon, and Disdale.

Although all the details of the separation of UK from the EU will be developed in the following years, most likely there will be some changes related to legal regulations and taxation rules. For example, now, countries in the EU share common VAT system, preventing double VAT payments. This may not be a case anymore for trades with the UK.

From the sales standpoint, the UK is one of the most important markets in Europe with the third highest sales after France and Italy. Right after the results of the referendum were announced, the British pound fell to its lowest since 2008, making it cheaper for foreigners to buy boats that are selling in British pounds.

On the other hand, after analyzing the historical correlations between the UK and European boat sales and the currency exchange rate, we can’t find any significant correlation between the two.

This graph shows data from boat sales in Europe (select the countries on the right, only UK data shows by default), U.S. dollar/British pound exchange rate and the FTSE 100 Index:

Brexit will certainly influence the market one way or another in the upcoming years, both in negative and positive ways, mainly because it brings disruption to the industry and creates new challenges and opportunities.

If you would like more information on how this may affect the purchase or sale of a yacht, call 954.763.3971 or email Sales@denisonyachtsales.com.