USDOC, International Trade Administration

 SOURCE:       USDOC, International Trade Administration
 PROGRAM:     Market Research Reports
 UPDATE:      Monthly
 ID NUMBER:   IT MARKET 111100487
 END YEAR:    1993
 UPDATED:     05/14/93
 | 9302
 | CC409
 | ISA
 | ISA9302
 | PLB
 | EC
 | EEC
 This article is derived from a report titled: "The Pleasure Boats Market in
 Denmark", dated February 1993, prepared by Inga Frederiksen, American
 Embassy - Copenhagen.  This article consists of 10 pages and contains the
 following subtopics:
 The boating industry in Denmark has suffered much in recent years because of
 the effects of the unfavorable economy.  Danes previously traded their old
 boats for new ones every fourth or fifth year, but because of the economic
 situation are presently reluctant to make such an investment in new boats.
 Most of the Danish-produced pleasure boats are currently being exported.
 Relative to the size of the country, Denmark is a large and well-respected
 producer of wind and motor-assisted boats.  Total production of motorboats
 is relatively small (see "Important Statistical Notes").  The quality of
 Danish-produced pleasure boats is excellent by industry standards, but
 Danish boatbuilders have encountered problems in selling their boats in
 Denmark due to the present downturn in the economy and unemployment
 uncertainty.  The companies are therefore making a strong effort to export
 their boats, and appear to be doing fairly well, as 801 units were exported
 in 1992, including some used boats.
 Among Danish buyers there seems to be a clear and growing preference for
 buying motorboats and the sailboat market has dropped commensurately.  The
 market seems to be slightly increasing for small motorboats and small
 sailboats, and the boat-chartering market also seems to be increasing.  The
 market for U.S.-built boats has become more favorable, because American
 boatbuilders are now producing boats to Nordic requirements and are keeping
 prices comparatively low by Danish standards.  High-quality boat equipment
 and accessories are required by Danish yachtsmen and this industry is
 well-represented in Denmark by local manufacturers.  Best sales prospects
 are to be found in: advanced electronic equipment, motors, GPS navigators,
 high-quality hardware, etc.
                                             Est. Avg. Annual Real
                   1991     1992     1993e*  Growth - Next 3 Years
 Import Market     143       92       90              0%
 Local Production  260e     230e     200
 Exports           268      311      250
 Total Market      135e      11e      40              0%
 Imports from U.S.  22       20e      20              0%
                            (US DOLS MILLIONS)
                          1991     1992     1993e*
 Import Market            22.3     15.2     13.9
 Local Production         40.6e    38.1e    30.8
 Exports                  41.9     51.5     38.5
 Total Market             21.1e     1.8e     6.2
 Imports from U.S.         3.4      3.3e     3.1
 Exchange Rate             6.40     6.04     6.50
 (DKK Equals DOLS 1.00)
 Future Inflation Rate Assumed: 2%
 Estimated 1992 Import Market Share (Percent for U.S. and Major Competitors):
 USA 20.4%, Sweden 20.5%, Finland 14.7%, Norway 14.5%, U.K. 5.4%, Canada
 5.3%, The Netherlands 4.8%, Germany 3.4%.
 Receptivity Score (1-5): 4
 (e = estimated)
 IMPORTANT STATISTICAL NOTES:  Official Danish import/export statistics on
 pleasure boats are used, but local production statistics are estimates, as
 the official statistics are inadequate.  The total market is therefore
 estimated.  The import market share is also estimated, because the official
 Danish market share statistics by country for the whole of 1992 are not yet
 available.  The above statistics include the following Harmonized System
 (HS) codes: 8903.91.10.0, 8903.91.93.0, 8903.91.99.0, 8903.92.10.0,
 8903.92.91.0, 8903.92.99.0, 8903.99.91.0, 8903.99.99.0.  They do not include
 inflatable boats, small sailboats (max 100 kg.) and those with auxiliary
 motors, canoes, small rowing boats (under 100 kg.), kayaks, dinghies, and
 * Market Demand.  Denmark's population is slightly over 5 million people.
 Relative to the size of the country, it is a large producer of quality
 sailboats and cruising boats .  Additionally, Denmark is a respected
 manufacturer of electronic equipment and other accessories for the boating
 industry, despite the low level of local motorboat production.  This strong
 position in the industry stems from the high number of Danes who sail along
 Denmark's unusually long coastline.  Few Danes live more than an hour's
 drive from the sea.
 Unfortunately, the Danish pleasure boat industry has suffered much in recent
 years.  The sailboat market has dropped 80 percent since 1986.  Cautious
 optimism is the guiding philosophy of the boating industry, despite fears
 that boat sales would be negatively affected by the unfavorable outlook for
 the global economy.  The motorboat market has, since 1986, been fairly
 good.  Danish-produced motorboats (length approx. 35-45 feet) are of high
 quality and relatively expensive compared with U.S.-produced boats.  The
 price of second-hand boats dropped 20-30 percent in 1989, but boat prices
 are now stable.  The boat accessories market remains stable and is even
 increasing slightly, especially for the maintenance of used boats.
 There are several reasons why the Danish pleasure boat market may be
 interesting for U.S. companies.  Though the Danish market itself is small,
 Danish dealers (both at home and through their branch offices abroad) export
 boats to other European countries.  The charter business has also begun to
 blossom (boats are being rented for 1 or 2 weeks).  As previously mentioned,
 there seems to be a tendency in Denmark towards buying motor-driven pleasure
 boats instead of sailboats.  Water transportation and sea-to-land
 communication in Denmark is good and the exchange rates are favorable.  Tt
 is also anticipated that a watersports industry is emerging in Eastern
 Europe, which can be supplied by West European or U.S. companies.
 Unemployment in Denmark is presently high, and the estimated annual growth
 of boat sales for the next 3 years depends very much not only on local
 economic conditions, but on those in the rest of Europe.  If the situation
 improves and unemployment drops, the sailboat market could increase by
 approximately 10 percent and the total market by 2.5 percent (according to
 industry sources), due to the Danes' pent-up demand.
 * End-user Profile
 It is estimated that the total number of pleasure boats (over 20 feet in
 length) in Denmark is around 40,000, of which approximately 25,000 are
 sailboats and 15,000 are motorboats and other types.  This total will
 probably remain unchanged.  However, many boats will be refurbished in 1993
 with new sails and possibly with new motors.
 Danish yachtsmen are considered some of the world's very best  and have
 proven it for generations at numerous small boat world championships and at
 the Olympic Games.  Many, therefore, make strict demands on the boats and
 the equipment they purchase.
 *Motor-assisted sailboats
 *Sailboats (small)
 *Accessories: Motors, electronic equipment, GPS navigators, high-quality
 hardware, etc.
 The market for small, reasonably priced motorboats and small sailboats is
 increasing, and the market for second-hand boats has increased
 considerably.  Best export markets for Danish pleasure boats are Germany
 (including the former Eastern Germany), Sweden, Switzerland, Italy, the
 Netherlands, France, the United Kingdom, and Japan.  A new market is
 expected to emerge in Poland and the Baltic countries, especially for small
 and second-hand boats.  These markets can also be serviced by Danish
 companies for U.S. manufacturers.
 * Domestic Production
 Denmark is a relatively large producer of quality sailboats and cruising
 boats, though the production of motorboats is small.  The boat market has
 suffered much in recent years.  Statistical data from 1992 show a
 considerable increase in Danish exports of pleasure boats, some of which
 were probably unsold boats from previous years, some were reexports and a
 considerable number were used boats.
 Most Danish-produced pleasure boats are exported worldwide.  The 1992
 estimates of major importers of boats from Denmark are: Germany 45 percent,
 Sweden 9.4 percent, Switzerland 7.2 percent, France 6.8 percent, Italy 6.6
 percent, The Netherlands 4.1 percent, the United Kingdom 3.5 percent and the
 United States only 0.9 percent.  The price of the Danish-produced boats is
 fairly high because of the high quality and labor costs.  A number of Danish
 boatbuilders have had to close down because of the decreased market.  Only
 approximately 20 boatbuilders are left, and they are doing reasonably well
 because most of their boats are exported.  Danish boatbuilders who are also
 in the repair business are doing fairly well, because the Danes are
 presently reluctant to spend money on new boats and are therefore
 maintaining and keeping their old boats, longer.  The sale of new sailboats
 within Denmark has almost stopped.  Only 10-15 percent of new Danish-built
 sailboats are being sold by Danish shipbuilders, compared with the figures
 in the good years of 1985-86.  The Danes are also producers of high quality
 electronic equipment and accessories for the boating industry.
 * Imports
 Total imports of pleasure boats to Denmark for 1992 amounted to 15.2 million
 (sailboats, $6 million and motorboats and other boats, $9.2 million).  This
 represents a decrease of 68.2 percent compared with 1991.  Imports are
 estimated to decrease to $13.9 million in 1993.  The market is dominated by
 major suppliers from Sweden, the United States, Finland, and Norway.  It
 should be noted, however, that some of the imported boats are sold directly
 to end-users in other countries.
 * U.S. Market Position and Share
 According to estimated Danish statistics, the United States had, in 1992, a
 market share of 3.4 percent for sailboats (incl. motor-assisted sailboats)
 and 32 percent for motorboats and other boats.  Some U.S. boat brands which
 are already in the Danish market are: Bayliner, Maxum,  Sea-Ray, MacGregor,
 Grand Banks, Formala, Regal, and Chaparral.  It is impossible to estimate a
 U.S. market share of boat accessories, but some of the companies already
 selling here are Mercury motors (American Marine Power), Johnson and
 The sale of American motorboats has definitely improved.  Part of the reason
 may be that American boatbuilders are now producing boats according to
 Nordic requirements and in their boat promotions in Europe are keeping
 prices comparatively low.  The low U.S. dollar rate is also a positive
 selling factor.
 * Competitive Factors
 The main competitive factors are effective marketing and reasonable price
 according to the quality of the boats/accessories.
 * Import Climate
 Denmark is a full member of the European Community (EC), and as such applies
 the EC external duty tariff to products entering from third countries.  Once
 cleared by customs of an EC country, goods may move duty-free within the
 EC.  There are no specific non-tariff barriers in Denmark, which might
 impede foreign competition.
 It should be mentioned that Denmark's Value Added Tax (VAT) at 25 percent,
 is the highest in the EC, whereas neighboring Germany, has the lowest VAT
 (15 percent).  This fact really hits the Danish boat retailers hard, and
 has resulted in the establishment of a number of Danish boat dealers'
 offices in Germany (thus saving their customers 10 percent VAT).  The Danish
 Government is also suffering from this difference in the VAT between the two
 countries.  According to trade sources, a number of Danish-produced boats
 will, because of the VAT, be exported to Germany and then reexported into
 Denmark in order to save the 10 percent difference.
 Danish businesspeople are very experienced in international trade, and
 virtually all have at least a working knowledge of spoken and written
 English.  Customs clearance is very quick and efficient, and the
 infrastructure of the country is excellent.
 U.S. companies may find it advantageous to use Denmark as a central
 distribution point/gateway for sales to the rest of Scandinavia and the
 Baltic countries of Lithuania, Latvia and Estonia.  Other possible export
 markets of interest serviced by Danish boatbuilders and dealers are Germany
 and Poland. Danish boat companies are active in the whole of Europe.
 No approval is required for the importation of boats into Denmark.  However,
 boats for chartering must be approved by the Danish Maritime Authorities
 (Sofartsstyrelsen).  The import duty rates for pleasure boats are
 0 to 3.8 percent.
 * Distribution/Business Practices
 U.S. exporters of pleasure boats and accessories should consider entering
 the Danish market by appointing an agent or distributor or an exclusive
 agent for Scandinavia (or Northern Europe), because the Danes speak several
 languages and are very active in the international market due to the small
 size of their domestic market.
 * Financing
 The Danish currency, the Krone (DKK), is part of the European Monetary
 System (EMS), a European-wide monetary foreign exchange agreement set up for
 the purpose of stabilizing European currency.  There are no Danish foreign
 currency restrictions impeding the transfer of funds between Denmark and the
 United States.  Practically all Danish banks have correspondent banks in the
 United States.
 Terms of financing vary considerably depending on conditions of the
 agreement, such as volume of business, type of loan (whether boats or
 accessories), credit rating, etc.  It is recommended that all business be
 done on a secured basis, at least in the initial phase of a business
 relationship.  U.S. boat accessories manufacturers should eventually be
 expected to extend a credit of 30-60 days from date of invoice, and
 individual agreements and financing must be negotiated between the
 exporter/distributor with regard to boat purchases.
 The most active and well-known pleasure boat financing institute in Denmark,
 So-Finans A/S (owned by the Danish bank Aktivbanken A/S), has recently
 ceased its financing activities.  The company was financing private
 purchases of pleasure boats (of which approximately 80 to 90 percent were
 used boats).  A couple of other private boat financing companies are still
 in business, and offer financing of both used and new pleasure boats.
 Otherwise, financing of private pleasure boat purchases in Denmark is a
 matter between a private individual and his or her commercial bank.
 * Key Contacts
 (Country Code for Denmark is 45)
 The Danish Chamber of Commerce
 DK-1217 Copenhagen K
 Tel: 33 95 05 00
 Fax: 33 32 52 16
 Contact: Jorgen Schaarup, Chief of Section
 The Confederation of Danish Industries
 H.C. Andersens Boulevard 18
 DK-1787 Copenhagen V
 Tel: 33 77 33 77
 Fax: 33 77 33 00
 Contact: Jorgen Stein, Director
 The Association of Commercial Agents
 DK-1217 Copenhagen K
 Tel: 33 14 49 41
 FAX: 33 12 69 81
 Contact: Ole Olsen, Chief of Secretariat
 (The Danish Maritime Authorities,
   Div. of The Ministry of Industry)
 Vermundsgade 38-C
 DK-2100 Copenhagen O
 Tel: 39 27 15 15
 FAX: 39 27 15 16
 (Responsible for all rules and regulations
 within the boating industry)
 Sosportens Brancheforening
 (The Danish Boating Industry Association)
 DK-1217 Copenhagen K
 Tel. 33 95 05 06
 FAX: 33 32 52 16
 Contact: Per Lippert-Scherwin, Chief of Secretariat
 (Association of professional companies within the boating industry.  Members
 include: manufacturers, importers, exporters, wholesalers, dealers,
 retailers, brokers, shipvaleurs, charter companies, workshops, insurance
 companies, and financing companies.)
 Baadkommissaeren A/S              Baunsoe Marine/City Boats ApS
 Gronlandsgade 8                   Kalkbraenderihavnsgade 22
 DK-5300 Kerteminde                DK-2100 Copenhagen O
 Attn: Anders Chr. Hansen          Attn: Niels Baunsoe/Flemming Als
 Tel: 65 32 18 15                  Tel: 31 20 33 22
 FAX: 65 32 18 19                  FAX: 31 20 32 90
 Dacapo Boats                      DNA Marine A/S
 Skipperthusene 5                  Rungsted Havn 30
 P.O. Box 112                      DK-2960 Rungsted Kyst
 DK-2680 Solrod Strand             Attn: Ole Damgaard-Nielsen
 Attn: Lidvin Virkesdal            Tel: 45 76 80 22
 Tel: 56 14 86 85                  FAX: 45 76 53 43
 FAX: 53 14 63 35
 Engstrom Marine A/S               Europa til Sos Marinecenter A/S
 Rantzausgade 68                   Nybolnorvej 16-A
 DK-2200 Copenhagen N              DK-6310 Broager
 Attn: Sven Engstrom               Attn: Anker Hansen
 Tel: 31 39 38 00                  Tel: 74 44 10 44
 FAX: 31 39 00 07                  FAX: 74 44 03 33
 Tage Floor Marine-Center          Ove Floor
 Kulholmsvej, Havnen               Toldbodgade 94
 DK-8900 Randers                   8900 Randers
 Attn: Tage Floor                  Attn: Ove Floor
 Tel: 86 42 68 88                  Tel: 86 42 64 55
 FAX: 86 41 07 52                  FAX: 86 43 60 09
 Holbaek Baadcenter A/S            J.L. Baadcenter ApS
 Stenhusvej 53                     Hojvaenget 3
 DK-4300 Holbaek                   DK-8330 Beder
 Attn: Jorgen J. Hedegaard         Attn: Jorn Lund
 Tel: 53 43 51 17                  Tel: 86 93 64 49
 FAX: 53 44 04 97                  FAX: 86 93 72 00
 Kolding Marinecenter A/S          Leif Larsen Marine
 Nordhavnen, Dkovej 8              Haandvaerkervaenget 6
 DK-6000 Kolding                   Tved
 Attn: Ebbe Borg                   DK-5700 Svendborg
 Tel: 75 53 02 00                  Attn: Leif Larsen
 FAX: 75 52 02 06                  Tel: 62 22 89 11
                                   FAX: 62 22 30 55
 Lynettens Baad Service            Marine Power Danmark
 Refshalevej 200                   Oster Kringelvej 21
 DK-1432 Copenhagen K              DK-8250 Egaa
 Attn: Klaus Schlichter            Attn: Ole Plauborg
 Tel: 31 57 61 06                  Tel: 86 22 09 11
 FAX: 42 18 43 76                  FAX: 86 22 09 70
 Masnedo Marinecenter A/S          Munter Marine
 Masnedovej 4                      Sundkrogskaj 12
 DK-4760 Vordingborg               DK-2100 Copenhagen O.
 Attn: Helmer Lund                 Attn: Soren Lindstrom
 Tel: 53 77 11 33                  Tel: 31 18 44 00
 FAX: 55 34 01 25                  FAX: 39 27 17 00
 Nautic Boats ApS                  Shipman A/S
 Mosede Strandvej 51               Egaa Marina
 DK-2670 Greve                     DK-8250 Egaa
 Attn: Palle Dahl                  Attn: Jorgen Bonde/Nic Poulsen
 Tel: 42 90 02 22                  Tel: 86 22 58 00
 FAX: 42 90 03 63                  FAX: 86 22 77 71
 Shipshape Ib Jacobsen ApS         Skibshandleren i Egaa ApS
 Rungsted Havn 32                  Stavneagervej 30
 DK-2960 Rungsted Kyst             DK-8250 Egaa
 Attn: Ib Jacobsen                 Attn: Harald Nielsen
 Tel: 42 86 85 20                  Tel: 86 22 09 22
 FAX: 42 86 22 16                  FAX: 86 22 55 66
 Tempo Baadsalg I/S
 Geminivej 8
 DK-2670 Greve
 Attn: Preben Thormann
 Tel: 42 90 01 15
 FAX: 43 69 00 14
 Strandboulevarden 130
 DK-2100 Copenhagen O
 Tel: 31 29 55 00
 FAX: 31 18 54 66
 (Boating News - Monthly consumer magazine)
 Willemoesgade 47
 DK-2100 Copenhagen O
 Tel: 35 43 25 55
 FAX: 35 43 29 29
 (Consumer magazine, published 6 times/year,
 by the Royal Danish Yacht Club, KDY)
 DMU - Danske Fritidssejlere
 Hjulmagervej 13-D
 DK-7100 Vejle
 Tel. 75 85 95 33
 FAX: 75 85 94 13
 (Consumer magazine - motorboats/cruising boats)
 Sosportens Brancheforening
 (The Danish Boating Industry Association)
 DK-1217 Copenhagen K
 Tel: 33 95 05 06
 FAX: 33 32 52 16
 (Bimonthly trade magazine)
 Trade Show:  Copenhagen International Boat Show (biennial)
 Location:    Bella Center, Copenhagen
 Dates:       February/March 1994
 Visitors:    39,300
 Organizer:   Bella Center A/S (in conjunction with
                (the Danish Boating Industry Association)
              Center Boulevard
              DK-2300 Copenhagen S
              Contact: Arne Bang Mikkelsen, Managing Director
              Tel: 32 52 88 11
              FAX: 31 51 96 36

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