After leaving a tough 2021 behind, the Balearic nautical sector predicts a year of negotiation
The Association of Nautical Companies in the Balearic Islands (AENIB) takes stock of 2021 highlighting the challenges faced such as lack of supplies, but also better than expected performance with a spectacular upturn in demand. The new year begins with a series of challenges and projects that affect the whole sector in our islands.
"The leadership of the Balearic Islands as a top nautical destination has been maintained throughout the year 2021, recovering part of what was lost in 2020, when there was a noticeable decline in the number of projects coming from large vessels for repair and maintenance work," explains Jaume Vaquer, the president of AENIB, in his review for the nautical sector.
"A year ago, my forecasts for 2021 were perhaps a bit more pessimistic compared to how the year ultimately unfolded," he acknowledges. "We have been pleasantly surprised that the market has maintained product demand, despite the uncertainty surrounding everything. This is excellent news for the sector. It reflects the fact that the substantial increase in prices suffered in the market has not reduced the consumption and the level of demand has been maintained," he stresses.
"This year, the issues in focus for the association will be vocational training, environment and digitalization," says Jaume Vaquer. "We will also redouble our efforts to make ourselves heard as a sector by the governmental authorities, busy as they are with the health and economic problems that afflict us all," he points out. "Issues such as the saturation of ports and the new master plan for the port in Palma, the refit tax, the vocational training of initiation to painting and repair of boats or the loss of space in STP will be on our agenda this year with regard to issues to be addressed with the administrations," he adds.
In his opinion, this reflects "the good health of the sector, which faced the first test already a decade ago: the companies that survived did so because they had the capacity and resources to move forward. This has given them some margin to take the blow of the health crisis, which has affected the nautical sector in a much less dramatic way than other sectors," he says.
As the sector's employer association, "AENIB has placed great emphasis during the past year on issues related to training, environment and digitalization, which were already in the focus before the healthcare crisis. These are the main axes of the association and of the sector, which this year has also had to deal with additional issues such as the ERTEs or production and supply interruptions," he explains.
Window of opportunity
"Throughout the year, the sector has capitalized on the window of opportunity provided by the pandemic, as many people have been drawn to yachting as a safe form of recreation and tourism," explains Carlos Sanlorenzo, secretary general of ANEN. "In January, we already predicted that it would be a good year, but it has exceeded our expectations," he notes. "The good performance of the season has surprised many, and we have observed a great interest in entry level yachting. This is very interesting for the sector, as it indicates the incorporation of new users," he reflects.
In this context, he highlights the "close relationship that AENIB has forged with Turespaña and the Secretary of State for Tourism during the past year. The authorities have realized that nautical tourism is an asset that must be taken care of. This type of tourism is of high quality with low concentration of people, in addition to promoting environmental values, sports and health hygiene. During 2021, the authorities have approved many of the proposals we have put forward in order to promote the nautical sector nationally and internationally," he emphasizes.
On the other hand, Carlos Sanlorenzo, , which AENIB forms part of, is confident of reaping rewards throughout 2022 of the "legislative action that we have been carrying out. This year will be marked by two important reforms: the Ports Act and the Maritime Navigation Act. We have been working on them for two years and expect them to bring good news for the sector," he says.
On the other hand, "there can be no growth without training and education. We must highlight the work of AENIB in this area, a great example for the nautical sector in the whole of Spain. We must redouble our efforts to promote training towards professional excellence required by the sector. The Centre de la Mar which was recently opened in Menorca represents this commitment and we must secure the continuity it deserves throughout the year," he says.
Lack of stocks and increasing prices
As for the structural conditions in which the nautical sector will have to operate in 2022, "will accentuate the lack of stocks," Vaquer predicts. "If in 2021 the sector was able to draw on its own resources and accumulated stocks, this margin has already been completely exhausted, while manufacturers now deliver goods only in dribs and drabs. This year, the drop in sales and deliveries of supplies will be more accentuated, earliest in 2023 and 2024 we should start to see a return to normality," he predicts. "As we have seen at boat shows this year, customers have found that there is no availability for 2022, so they are choosing to buy for 2023, closing sales 14 or 15 months in advance," he analyzes.
At this point, Sanlorenzo warns that "2022 is full of incognitos. Of course, in the middle of a pandemic it is very difficult to make forecasts, but regardless of how the health situation evolves, the supply crisis and production limitations in the face of growing demand will exacerbate price increases. We are concerned about the increasing prices and the supply crisis, since there is a lot of production that has already been sold while the sector has hardly any stocks left, as it used it last year to cover demand. Given the imbalance between supply and demand, companies may be forced to select customers," he warns.