In the name of Ebitda, the editorial by Franco Michienzi

Finance is once again investing in the Italian and European yachting industry, expecting it to generate stellar profits much greater than those of other sectors. It might be opportune to assess the development plans carefully

by Francesco Michienzi

UNLIKE THE MAIN MANUFACTURING SECTORS, THE PLEASURE YACHTING INDUSTRY has not been in any way affected by the progressive decline in the national macroeconomic scenario. Over recent years manufacturing as a whole has grown by around one percentage point, while in our sector development has been much more significant. Italy is the world leader in terms of its balance of trade, with 2.2 billion dollars, ahead of the United Kingdom with 1.5, the Netherlands with 1.4, Germany with 0.7 and Poland with 0.5, and it is one of the biggest exporters, second only to the Netherlands and ahead of the United Kingdom, USA, France, and Germany. The Italian yachting industry can count on an overall turnover of 4.78 billion euros, of which 1.64 million comes from the domestic market, and 23,510 direct employees, which rise to over 180,000 if we consider the industry as a whole.

Italy is once again confirming its world leadership in the superyacht sector in 2021, with 407 vessels under construction out of 821 on a global level. This is the biggest number of orders recorded by the country since 2009, which explains why financial investment funds have started looking at the world of boats again.

More and more information is coming in about funds offering the prospect of stratospheric gains. I have recently seen the financial statement of a brand that is returning to the market after around ten years. It has produced a plan with an expected turnover for 2021 of 5.6 million euros and negative EBITDA of 28,000 euros, 15 million in 2022, 33 in 2023, 54 in 2024, 86 in 2025, and 116 in 2026 with EBITDA of 20 million euros.

«We are deluded now by hope, now by what was hoped for… happiness lies always in the future, or else in the past». Arthur Schopenhauer

If this all goes to plan I will be the happiest person in the world. The thing that leaves me feeling perplexed is that it is not the only one with these prospects for growth. Another investor has announced the start of construction of thirty boats over 60’ long, which have already been sold in 2021. Not to mention those who started by taking over brands that had fallen out of favor and who were sure they would be going public within three years, without even having built a boat, and of whom all traces have been lost.

What they all share is vision: “Being a wonderful, close-knit family of professional figures who believe in the objectives that the company aims to achieve. Objectives in which pragmatic functionality and Italian style, technology and the expertise of master craftsmen and women, innovation and detailed material research, a passion for the sea, and meticulous attention to detail are merged. These are all elements incorporated within the single word customization. The boat is like a handstitched, almost tailor-made product, created to meet the individual client’s requirements. In short, a new way of conceiving the company and the product. And also an equal and courteous relationship with employees, based on discussion and sharing. From the production department to engineering, interior design, and the workers in the yard. All pushing in the same direction, with a single objective”.

I’ll spare you the rest regarding the relationship with ecology and workplace safety. All things that would make us jump for joy if they were true. Others say more or less the statements of the same thing, simply using other words. Almost as if to emphasize that the most successful Italian brands do not customize, do not care about the quality of the materials they use, and do not look after their workers and the environment, which is why we need these new yacht manufacturers.

We can only smile at the superficial way in which our sector is viewed from the outside. Do these investors really believe that the yachting market will grow fast enough to produce these profits? Do they really think it is possible to start from scratch and build a quality product based on a theoretical industrial design? Have they perhaps seen market analyses with growth prospects this big and gaps in production capacity to be filled? Or do they think they will be so competitive that they can steal market shares from more established brands?I have no answers. I simply have to wait and see. Three years pass quickly and I hope I’ll still be here to see what happens.

Let’s be clear that I’m in no way against financial innovation. I would simply like it to take place without infringements and in compliance with clearly defined rules, with detailed controls in place, offering businesses the chance to protect themselves from risks and create the necessary liquidity for their core business. Nevertheless, we cannot overlook the deregulation that began in the Anglo-American world in the mid-1980s and spread rapidly across the globe and through the most advanced economies, leading to a widespread genetic mutation in finance.


«The world that we must seek is a world in which the creative spirit is alive, in which life is an adventure full of joy and hope, based rather upon the impulse to construct than upon the desire to retain what we possess or to seize what is possessed by others». Bertrand Russell

Finance has been transformed into a real industry in which the end product is represented by more money placed in financial products, which are the offspring of innovative engineering and the culture of deception. These new products have invaded the planet, creating a sort of new virtual currency, whose overall value is estimated to be nine times the world GDP. This genetic mutation has detracted resources from the real economy, triggering an eight-year global recession from 2007 onwards, the tail end of which is still making itself felt in Italy and Europe. The huge mass of liquidity roaming the world is looking for the most profitable allocation in the shortest time possible.

Between 2010 and 2013, the great American, European, and Japanese multinationals’ invest-ments in financial activities amounted to 1.5 times what they invested in the industry. Those who manage finance and speculation use their art to cause values to rise and fall. If the stock rises in value, people buy it with no thought to what lies beneath, simply focusing on the profit percentage. When people have grown drunk on the illusion of easy earnings and lose sight of their limits, then the fund managing the operation starts to sell, making its profit. But the profit made by a small group of people is countered by the losses made by many who invested in anticipation of an impossible rise.

Perhaps my economic vision is somewhat old-fashioned and I’m more interested in material things, like a beautiful, well-designed, well-built boat, which is the result of hard work by talented people who have taken their time to build it properly, without being under pressure from those who have to compress everything in the name of adequate EBITDA for the investor in question. Furthermore, I would not mind seeing the return of a few good Italian companies able to manufacture microchips without depending on suppliers from the other side of the world.

(In the name of Ebitda – – June 2021)