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SOURCE: USDOC, International Trade Administration
SOURCE KEY: IT
PROGRAM KEY: IT MARKET
PROGRAM: Market Research Reports
UPDATE: Monthly
ID NUMBER: IT MARKET 111110221
TITLE: GREECE - PLEASURE BOATS - INDUSTRY ANALYSIS - ISA9012
DATA TYPE: TEXT
END YEAR: 1992
UPDATED: 09/18/92
KEYWORDS 1:
| 9012
| BEST|PROSPECTS
| CC484
| COMPETITION
| GREECE
| ISA
| ISA9012
| MARKET|ACCESS
| MARKET|ASSESSMENT
| MOTORBOATS
| PLEASURE|BOATS
| SPORTING AND RECREATION GOODS
| SPT
| STATISTICS
| TRADE|CONTACTS
| TRADE|PROMOTION
| YACHTS
COUNTRY:
| GREECE
| EC
| EEC
| EUROPE
| EUROPEAN COMMUNITY
| EUROPEAN ECONOMIC COMMUNITY
| OECD
| ORGANIZATION FOR ECONOMIC COOPERATION & DEVELOPMENT
| ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMET
| WEST EUROPE
| WESTERN EUROPE
| WESTERN EUROPEAN COUNTRIES
TEXT
GREECE - PLEASURE BOATS - INDUSTRY ANALYSIS - ISA9012
SUMMARY
This article is derived from a report titled: "The Pleasure Boat Market in
Greece", dated December 1990, prepared by George Bonanos, American Embassy,
Athens. This article consists of 11 pages and contains the following
subtopics:
Market Assessment
Competitive Situation
Market Access
Trade Promotion Opportunities
Best Sales Prospects
Statistical Data
A. OVERVIEW:
As his flight touches down in Athens airport, a visitor looking out of his
window and seeing the numerous tightly packed marinas can observe that there
is a good market for pleasure boats in Greece. Once on the ground and on
his way to his hotel, the visitor sees boat dealer after boat dealer along
the boulevard. From a first glance, one would think that the pleasure boat
market is thriving. In reality, certain difficulties, caused by a lack of
infrastructure, set restrictions on the market's growth.
Although most of the major foreign pleasure boats firms are represented in
Greece, U.S. firms can still find capable businessmen interested in
generating sales for products new to the market. U.S. firms, however, must
be aware that pleasure boats are a luxury item in Greece and that their
sales depend on people having extra money to spend.
Presently, Greece's market for motorboats and cruisers is estimated to be
around U.S. dollars 32 million and, its growth is expected to continue if
peace and stability remain in the region (especially in the Gulf).
U.S. firms hold nearly one third of the import market, and they lead the
market for imported motorboats and small cruisers ranging from 6 to 8 meters
in length.
B. STATISTICAL DATA:
U.S. Dollars Millions
1988 1989 1990 Est. Avg. Annual Real
Growth - Next 3 Years
Import Market 6.8 10.8 12.3 20.0 percent
Local Production 15.5 18.3 20.1
Exports 0.2 0.3 0.6
Total Market 22.1 28.8 31.8 10.4 percent
Imports from U.S. 2.5 3.2 4.2 30.0 percent
(Greek Sources)
Imports from U.S. 6.8 7.0 9.4 percent
(U.S. Sources)
Exchange Rates: 141.9 162.4 159.3
Future Inflation Rate Assumed: 19.0 percent
1989 Import Market Shares (as a percentage of the total import market, based
on Greek official statistics):
U.S.A.: 29.6 percent
Italy: 18.5 percent
Taiwan: 16.9 percent
United Kingdom: 16.7 percent
Japan: 8.7 percent
Total 1989 Import Market
Shares held by European
Community (E.C.) Countries: 40.2 percent
Receptivity Score (1-4): 4 (Very receptive)
C. MARKET ASSESSMENT:
Greece's total market for motorboats and cruisers in 1989 was estimated to
be nearly U.S. dollars 29 million. Nearly 40 percent of this market is
supplied by imports. The total market appears to have an annual growth
rate of over 10 percent, while the growth of imports is expected to be
double that; i.e. 20 percent per year. However, imports from the United
States are expected to grow at an even faster rate of 30 percent per year.
Industry contacts explain that the reasons for this growth are the
following:
- the exchange rate of the U.S. dollar to the drachma has been more
favorable compared to the exchange rates of the British pound and the
Italian lira;
- the U.S. boat builders have not increased their prices due to the
industry's recessionary situation;
- Greek boat fans have realized the advantages and benefits of the
guarantees which U.S. firms provide; and
- growth of the import market is achieved at the expense of domestic
production.
Industry contacts commenting further on the high receptivity to U.S.
pleasure boats explain that this is due the following factors:
- competitive price;
- product reliability;
- a belief that a U.S. manufacturer and his agent will honor guarantees;
and
- high resale value.
Although the overall picture for the market is very optimistic, there is one
negative factor for at least 1991. Some industry contacts express concern
that due to the crisis in Gulf the market may actually fall in 1991. This
is because the Greek boating industry is heavily influenced by recession and
higher fuel prices, both of which would be a likely outcome for Greece in
the event of a war in the Gulf.
As for actual market size, there is a significant difference between data
concerning imports as presented by Greek and U.S. official statistics.
There may be several explanations for the difference, such as U.S.
statistics include Greek-owned vessels which end up under a foreign flag,
while such boats are not included in Greek statistics. The reasons for
flying a foreign flag are that an owner either wants to avoid the Greek tax
authorities or that a specific flag was prescribed to him by the bank which
issued the loan for the purchase of the boat. In reality, these boats fly a
foreign flag and are usually owned by a Liberian, Panamanian, or Cypriot
company which is ultimately controlled by the person who uses the boat.
Another explanation for the difference in statistics is that certain Greek
businesspersons purchase pleasure boats from the U.S. and then sell them in
the markets of nearby countries, such as Cyprus. These purchases would be
captured in U.S. statistics but would show up in Greek statistics as
reexports. Both of these explanations may be true to some extent.
Greece has hundreds of islands and an endless coastline. Very few of the
lakes are navigable while there are no waterways at all. Therefore,
practically all pleasure boats are used in the sea, and the models purchased
are all seagoing vessels. Traditionally, low budget boat owners had to be
content with small rowboats which were sometimes fitted with an inboard or
outboard engine. Today, they have the option to purchase an inflatable boat
which is light, fast, reliable and available in all sizes. The light weight
of the boat makes it ideal for being towed on a trailer or strapped to a car
rack without requiring a powerful vehicle. However, inflatable boats are
not only for low budget boat enthusiasts. Every year, larger and better
models become available. When fully fitted with motors and equipment, this
can require a $30,000 - $40,000 budget. The statistics presented in the
statistical chart do not include inflatable boats, but their widespread use
is directly related to the difficulties of owning a larger, better boat in
Greece.
Greece's large pleasure boat market has its foundations on the desire of
individual Greeks to own their own boat. The sea is accessible within a one
or two hour drive for the majority of Greece's residents. However, three
negative factors make this desire difficult to fulfill. These factors are
cost, the lack of marinas, and government taxation. Provided the boat
enthusiast can overcome the negative factors of cost, marinas, and taxation,
he will often chooses to purchase a small cruiser. Local production
satisfies the less demanding customers, with exports made on an irregular
basis to some E.C. and Middle Eastern countries. The more demanding
customers show a preference for imports. Industry contacts described the
purchaser of U.S.-made pleasure boats as the successful businessperson or
professional with two homes, two cars, and with excess money which he wants
to spend entertaining his friends.
Industry contacts say that in the area which surrounds Athens, where 80
percent of the market for pleasure boats is, there is a shortage of 5,000
mooring places. On a nationwide scale, the shortage is 10,000 places. This
shortage creates a black market for mooring places and the congestion in
most marinas is unbearable. The government has an ambitious program for
privatizing existing marinas and allowing the private sector to build
additional ones. Most contacts commented that new marinas will improve the
situation but will not be able to satisfy demand entirely.
Practically all pleasure boats sold in Greece are sold for private use. The
reason why they are not sold for chartering is that Greek law prescribes
that they have a skipper. This adds to the cost and when the boat is small
the renter has no privacy. There have been several requests to the
government to remove this requirement, but, according to industry contacts,
this will not happen for another year or two. If and when this requirement
is dropped, the market will acquire a new and important category of
clientele, the motorboat rental firm.
Another important factor which make prospective purchasers reluctant to
purchase a boat is the lack of credit offered. Although Greece's investment
laws offer grants and subsidies to purchasers of sailing boats, such
incentives are not available for the purchase of motorboats. However, some
purchasers of motorboats obtain credit directly from foreign banks, either
directly or with the guidance of the Greek pleasure boat representative.
Industry contacts suggested that if U.S. boat manufacturers become more
involved with assisting their overseas customers to obtain credit, the terms
of the credit could be better and therefore they could secure additional
sales.
D. BEST SALES PROSPECTS:
89.03.92.99 Motor boats of a length exceeding 7.5 meters
89.03.92.99 Motor boats of a length not exceeding 7.5 meters
The segment of the market where U.S. firms have best prospects is that of
motorboats and small cruisers ranging from 6 to 8 meters in length. These
sizes partially fall in both of the above product categories.
E. COMPETITIVE SITUATION:
The market for motorboats is broken down into two categories: those over
and under 7.5 meters. U.S. boat manufacturers are highly successful in
selling boats ranging from 6 to 8 meters. The U.S. import market share here
is approximately 50 percent. Competition comes from Taiwan, Italy, and the
U.K. According to industry contacts, the market segment for boats under 6
meters is dominated by local production, while Italy and France have the
leading shares in the limited market for larger pleasure boats over 8 meters
in length.
Most major U.S. firms, such as Bertram, Boston Whaler, Hatteras, Bayliner,
and Cris Craft have a presence in the Greek market. Additionally, their
major competitors such as Princess, Sunseeker (U.K.), Riva, Ferretti
(Italy), and Jeanneau (France) are also present. Most of the major agents
represent U.S. as well as other foreign firms, in order to be able to carry
a broad product range. Most firms carry a limited volume of stock, with
only one or two vessels on display. There are, however, a few distributors
which display 10 to 15 vessels.
According to industry contacts, the advantage of U.S. firm is based on
quality, reputation and service. Price is also an important advantage, and
U.S. pleasure boats not only sell at fairly affordable prices when new, but
they also succeed in maintaining good prices when sold secondhand.
Promotion is also important but boat enthusiasts appear quite knowlegeable
about the subject from reading reports and tests in local and foreign boat
magazines.
F. MARKET ACCESS:
Motorboats imported into Greece from non EC countries are subject to an
import duty of 2.5 percent applicable on the CIF value. There is also a
Value Added Tax of 18 percent, which is applied to all motorboats (including
locally produced) regardless of their origin.
In order to enter the Greek market, U.S. firms must appoint an agent or a
distributor. Greek businesspersons frequent major international boat shows
held in Europe, and U.S. firms can make good contacts at these shows.
However, before making any commitments, U.S. firms are advised to obtain
some information, such as a credit report, providing good information about
the prospective agent. One major boat importer commented that a U.S. firm
seeking representation in Greece must be very careful when appointing an
agent or distributor because the market is full of semi-knowlegeable boat
importers. He added that pleasure boats are expensive items with a seasonal
market. To make thing more difficult, style preferences change from time to
time. More than once, a successful Greek businessperson, such as a car
importer, has diversified into the pleasure boat market, and then panicked
when the summer went by with a portion of his stock unsold. These
businesspersons are accustomed to the auto market which moves much faster.
Another problem is that several people visit trade shows outside of Greece
and pick a boat that they like. If the boat is not represented in Greece,
they suggest that they be appointed agents for Greece hoping to reduce the
actual cost of their own personal acquisition. The result is that the boat
manufacturer ends up with an agent, who may not actually be interested or
capable of promoting the product.
According to industry contacts, there are no difficulties related to meeting
specific safety standards for pleasure boats in Greece. In order to
register a pleasure boat, the only documents required are the following:
- If the boat is under 6.5 meters in length, a certificate of suitability
issued by the manufacturer is sufficient.
- If the boat is over 6.5 meters in length, the manufacturers
specifications and a bill of safety are required.
In preceding sections, we have mentioned several factors related to credit
and financing which are important to the success of U.S. firms. Following
are several items related to the financing of exports to Greece in general
which U.S. firms should be aware of.
Over the past year, the government has liberalized the import payment
process. Banks are now virtually free to finance imports as they see fit
and to make payments in foreign exchange without approval from the Bank of
Greece. As a consequence, the import payment process is similar to that
used in the rest of Europe utilizing cash against documents, sight drafts,
time drafts, and irrevocable letters of credit. Greek banks have extensive
correspondent relationships with U.S. banks, and Citicorp, Bank of America,
Chase, and American Express all have offices in Athens.
However, U.S. exporters should know that letters of credits and drafts are
very expensive for Greek importers. Banks require that the cash equivalent
be on deposit before issuing any guarantees. In a country where working
capital loans now cost more than 34 percent in interest, this poses a heavy
economic burden on the Greek importer. To get around this, Greek businesses
often seek cash against documents or extended credit terms of 30-60 days or
longer from their suppliers. European companies routinely deal on this
basis making U.S. products less competitive, since U.S. suppliers unfamiliar
with the market correctly require more stringent payment terms.
An additional problem concerns the size of the Greek importer. He is
normally a small businessperson representing a number of different
products/lines. His orders are usually small, and he often cannot afford to
keep large stocks on hand. Therefore, he will request special consideration
if a U.S. supplier demands large orders or asks him to carry a large
inventory for reasons of service. European supplies know the Greek market
better, visit it more often, understand its peculiarities, and because of
transportation distances are able to supply stock more quickly than their
American counterparts. Thus, they are often willing to provide easier
credit terms to Greek importers than are American suppliers.
U.S. banks and business should exercise caution in extending credit to Greek
business. It is important to obtain full credit background checks on any
prospective recipient of liberal financing terms. Most Greek businesses
have an unhealthy debt/equity ratio and are highly vulnerable to changing
interest rates. Therefore, it is a good idea to run periodic credit checks,
even on businesses which have good payment records.
As a final caveat, we should point out that we occasionally experience
payments disputes involving Greek banks which have inadvertently released
documents, and therefore goods, before payment has been received from sight
drafts and even letters of credit. We can only conclude that in such cases
we are dealing with an inexperienced Greek banking system and one in which
personal relations (i.e. between bank employee and businessperson) can lead
to actions which are detrimental to the supplier. Therefore, we recommend
that the U.S. exporter exercise caution at all times in selling to Greece.
Drafts and letters of credit should clearly spell out all requirements for
the release of goods, specify all currencies, payment terms, and details of
quality/quantity of goods. In short, nothing should be left to chance or
interpretation. Ninety-five percent of business with Greece is
straightforward without problems. It is the other five percent which U.S.
bankers and businesses have to pay attention to. In short, if you do not
know your customer, exercise every precaution. Above all, never/never make
subsequent shipments to an importer who has been unable or unwilling to pay
for earlier shipments.
The following list includes names and addresses of key contacts in the
industry:
Trade Associations:
Association of Boat Importers
c/o Aqua Sport
20 Ellinikou Street
GR-167 77 Elliniko (Athens)
Greece
Phone: 01130/1/8981649, 8981650 & 8981651
Fax: 01130/1/8981637 & 8981639
Contact: Mr. F. Sidiropoulos, President
The association has no offices of its own and operates out of the office of
its President who is one of Greece's leading boat importers.
Greek Yacht Brokers Association
c/o Ghiolman Yachts and Travel
7 Fillelinon Street
GR-105 57 Athens
Phone 011/30/1/3233696 & 3230330
Fax: 011/30/1/3223251
Contact: Mr. M. Ghiolman, President
The association has no offices of its own and operates out of the office of
its President, who is one of Greece's experts on issues relating to pleasure
boats.
American-Hellenic Chamber of Commerce
16 Kanari Street
GR-106 74 Athens
Greece
Phone: 01130/1/3636407 or 3618385
FAX: 011/30/1/3610170
Telex: 223063
Contact: Mr. Simos Tsomokos, General Manager
The Chamber is an association of local firms engaged in business with the
U.S.A. The Chamber and the U.S. Embassy organize U.S. participation in
major Greek trade shows.
Local Boat Dealers:
Aqua Sport
20 Ellinikou Street
GR-167 77 Elliniko (Athens)
Greece
Phone: 01130/1/8981649, 8981650 & 8981651
Fax: 01130/1/8981637 & 8981639
Contact: Mr. F. Sidiropoulos, General Manager
Firms represented: Sea Ray, Boston Whaler, Tiara (U.S.A.); Princess,
Fairline, Sigma (U.K.); Tresfjord, Marex (Norway);
President, High Star, Hylas, Ocean Alexander (Taiwan);
Clanship (Italy); Sunway (Turkey)
Alevin Boats
510 Vouliagmenis Avenue
GR-174 56 Alimos
Greece
Phone: 01130/1/9928285 or 9913341
Fax: 01130/1/9930055
Contact: Mr. B. Alexandropoulos, General Manager
Firms represented: Bayliner (U.S.A.); Tullio Abbate (Italy)
Aquadynamics Marine Technosport Specialists Co Ltd.
9 Epaminonda Street
GR-166 74 Athens
Greece
Phone: 01130/1/9622820
Fax: 01130/1/9625219
Contact: C. Riginos, Import Manager
Firms represented: Glastron, Rinker, Renken (U.S.A.); Doral (Canada)
Athinaika Kotera ltd
2 Achileos Street
GR-175 62 Athens
Greece
Phone: 01130/1/9811820
Fax: 01130/1/9818092
Contact: Ms. D. Leshopoulou, Manager
Firms represented: Jeanneau (France/U.S.A.)
Azzura Yachting
48 Synassou Street
GR-184 50 Piraeus
Greece
Phone: 01130/1/9833395, 9830379 & 49265589
Fax: 01130/1/4905621
Contact: C. Mamfos, Manager
Firms represented: Carver Yachts, Invader (U.S.A.)
EKKA S.A.
2 Davaki & Posidonos Street
GR-174 55 Alimos
Greece
Phone: 01130/1/9848992
Fax: 01130/1/9848227
Contact: Mr. K. Themelis, Manager
Firms represented: Hatteras, Grand Banks (U.S.A.); Ferreti Craft, (Italy)
Importex Marine S.A.
97 Syngrou Avenue
GR-117 45 Athens
Greece
Phone: 01130/1/9219411
Fax: 01130/1/9224402
Contact:Mr. D. Primikiris, Manager
Firms represented: Four Winds, Sunbird (U.S.A.)
Ison S.A.
32 Kifisias Avenue - Atrina Center
GR-151 25 Athens
Greece
Phone: 01130/1/6846253
Fax: 01130/1/6846662
Contact: Mr. M. Papatheodoulou, Manager
Firms represented: Grand Soleil (Italy), Hudson (Italy)
Kappa Marine
201 Syngrou Avenue
GR-171 21 Athens
Greece
Phone: 01130/1/9358222
Fax: 01130/1/9358273
Contact: Mr. A Katsoulas, Manager
Firms represented: Viking (U.S.A.); Azimut, Diantoni, Rafaeli (Italy);
Sealine, BirchWood (U.K.); Sea Hawk (Taiwan)
Korfiatis Yachts
76 Kalirois Street
GR-117 41 Athens
Greece
Phone: 01130/1/9237166
Contact: A. Korfiatis
Firms represented: Nimbus (Sweden)
Kyriakoulis Mediterranean Cruises Shipping S.A.
51 Posidonos Avenue
GR-175 62 Palio Faliro
Greece
Phone: 01130/1/9815207
Fax: 01130/1/9817823
Contact: Mr. K. Kyriakoulis
Firms represented: GIB'SEA (France); Najad (Norway)
Maritime Marketing International
23 Papanastasiou Street
GR-154 52 Psihiko (Athens)
Greece
Phone/Fax: 01130/1/6722497
Contact: Mr. K. Pontifix
Firms represented: Ocean Yacht (U.S.A.); Guy Couach, (France); Bruno
Benetti, Persing, Gianetti (Italy)
MOTI S.A.
9 Syngrou Avenue
GR-117 43 Athens
Greece
Phone: 01130/1/9234649
Fax: 01130/1/3245476
Contact: Mr. S. Constantinidis
Firms represented: Century, Glasstream (U.S.A.); Wolfe (U.K.)
Golden Dolphin
15 Paleologou & Orfeos Streets
GR-175 64 Paleo Faliro (Athens)
Greece
Phone: 01130/1/9410105 & 9410153
Fax: 01130/1/9410103
Contact: Mr. F. Bouboulis, Manager
Firms represented: Bertram, Cris Craft, Cigarette, Trojan Yacht Formula
(U.S.A.); Riva (Italy); Sunseeker (U.S.A.)
G. TRADE PROMOTION OPPORTUNITIES:
As stated earlier, leading international boat shows are frequented by Greek
businesspersons and prospective buyers. In Greece, several competing and
conflicting boat shows have been held over the past few years. The industry
has finally decided to sort things out and to settle on one show which will
be held twice a year. The show is the International Boat Exhibition, and it
is organized by Helexpo, the official organizer of the Thessaloniki
International Show. The International Boat Exhibition has been scheduled to
be held in Athens from March 9 to 17, 1991, and in Thessaloniki from
November 2 to 10, 1991. The address of Helexpo is the following:
Helexpo S.A.
154 Egnatia Street
GR-546 36 Thessaloniki
Greece
Phone: 01130/31/239221
FAX: 01130/31/229116
Telex: 412291
There is also the possibility of participating in the Thessaloniki
International Show, where the American-Hellenic Chamber of Commerce has its
own pavilion. The show is held every year, is horizontal, and attracts over
a million visitors from all over the Greece. The next show will be held
from September 7 to 16, 1991. Participating in this show could offer good
publicity, provided the U.S. firm has already reached a working relationship
with an agent. However, participating in this show without an agent is not
recommended. The address of the American-Hellenic Chamber of Commerce is
the following:
American-Hellenic Chamber of Commerce
16 Kanari Street
GR-106 74 Athens
Greece
Phone: 01130/1/3636407 or 3618385
FAX: 011/30/1/3610170
Telex: 223063
Another method of promotion is through various trade magazines. Following
is a listing of the major publications in Greece:
Plefsi Magazine
Cambas Publications
38 Dimocratias street
GR-154 51 Neo Psihiko (Athens)
Greece
Phone: 01130/1/6479421
Fax: 01130/1/6712685
Sea and Yachting
Naftikes Ekdosis EPE
22 Akti Themistokleous Street
GR-185 36 Piraeus
Phone: 01130/1/4529571
Fax: 01130/1/4137805
Nautica
66 Posidonos Avenue
GR-174 55 Alimos (Athens)
Greece
Phone: 01130/1/9837877 & 9840766
Fax: 01130/1/9812822
Hellenic Marine Guide
Samouhos Bros Publications
330 Syngrou Avenue
GR-176 73 Kalithea (Athens)
Greece
Phone: 01130/1/9594567
Fax: 01130/1214276
Greece
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