Interview: Paolo Vitelli for Azimut Benetti
The CEO of Azimut Benetti, arguably Europe’s top motor yacht-builder and mega-yacht producer, talks innovation in boating and the yachting lifestyle in Asia.
Paolo Vitelli, direct and powerful, a native of Turin, has a passion common to many true Piedmont natives: the mountains. A passion so strong it propelled him to revive old mountain chalets, creating the Champoluc luxury resort Hotellerie de Mascognaz, at the foot of Italy’s Monte Rosa. But this is not Vitelli’s only great interest or what has made his name synonymous with luxury and finesse. It is simply his love of boats that has transformed him into one of the world’s most dynamic and famous Italian shipping entrepreneurs. In 1969, at 22 years of age, Vitelli founded the Azimut sas. firm as a charter company hiring out sailing boats.
The following year, Azimut began to import and sell boats on the market before the production venture began from artisan-built boats to industrial production; from one single boat to a series of boats. After 10 years of steady growth Vitelli bought the Benetti firm, one of the most famous mega yacht builders in the world, solidifying his status in the industry as a visionary. Today the Azimut Benetti Group is the most important European motor yacht builder and the leading mega yacht builder in the world. YachtStyle met the CEO at the Azimut Benetti Yachting Gala staged in Portofino in June 2015.
What have been Azimut Benetti group’s latest developments?
We have launched several new models, all with a very high level of finish and quality. We sold 12 of our new 34 Atlantis; our new Azimut 54 also is having brisk sales. Another new model is the beautiful Azimut 84. We sold six or seven of our new 43 Magellano. We also have had three new orders for our flagship Magellano 76 that was presented as a world premiere at the Portofino Yachting Gala. Not new, but a consistent seller is the Azimut 116—we sold two of them recently, it is a very popular boat. As for Benetti, we are booked for the next three years and we have new orders pending.
What is Azimut’s share of the world market?
We estimate our Group has a 12 percent share of the world’s yacht market. We certainly have been doing better than our competitors, many of whom are suffering and disappearing. We are doing better primarily because we are a company very strong financially, capable of going long without being hit. Many companies owned by financial institutions or borrowing too much money have been heavily hit. So we are taking the opportunity of the tide to gain market share and become stronger.
You survived the economic crisis rather well. What are the key elements of this success?
We have always had the trust from our customers. They know we are solid and operating with a long-term vision. No doubt it is critical to keep up with new models and quality. Also, perhaps because of the crisis, we have chosen better dealers and because of the crisis, we have a more integrated team that is more efficient; we trimmed the fat. We are proud to be a family company and there has always been a lot of continuity. Azimut Benetti is not for sale and we are not dependent on the banking world.
You love to talk about the “Italian touch”, tell us more?
Italian design is all about enduring style, all around the world. People want Italian design, Italian quality, Italian craftsmanship, Italian fabrics, Italian brands, Italian food. So…we have the opportunity to export our interpretation of luxury into the world without compromising our principles. I feel that everybody respects Italian luxury… and Italian style and design are a symbol of luxury all around the world. This is especially true in the fashion and yachting world.
Biggest challenge ahead?
The biggest challenge as well as necessity ahead is innovation! The necessity to become more productive and more cost-efficient now is pushing companies like ours to reinvest in the process of production. We are increasing the number of boat models, and therefore jobs, and are reinvesting money to improve the process, both in terms of efficiency and gaining a higher level of quality in the yachts. As an example, 10 years ago, a boat was laminated by hand using glass and resin. Today we use infusion, which means no one is touching the resin and no one is breathing in the resin, so it’s better for the environment and for the people. Because we now cut the glass using machinery—putting the glass on the mold and injecting the resin—the process is 10 times more engineered and sophisticated than it was 10 years ago.
The innovations you feel proud of?
I will cite a few. Azimut Benetti was the first to put big windows in the hull, to put the garage in the back and to make a living area in the front of the yacht; and we were the first to use a really large flybridge. And today we’re seeing that people like to get closer to the water in every respect—just look at how many yachts now have balconies opening from the side, bridges in the back and easy access to the water. People want to be more sporty, they want to swim and they want to dine under the stars. In terms of technology, I would say comfort has been the prime requirement in the last 10 years. If you consider the noise level on a yacht 10 years ago, today that noise is a fraction of what it was. We’re also working on the stability of the yacht in bad weather and sea conditions if you’re sailing or at anchor. People like innovation, but they don’t want to abandon comfort.
What is your growth strategy? More acquisitions ahead?
It is not said that we have to grow, it is not said that we have to acquire companies in order to grow. At the moment we have the opportunity to grow because the market is good. When we see the market is stable, we might concentrate our efforts into industrial organisation, so acquisitions are not a necessity for growth. We take opportunities to enter new segments of the market primarily to give stability to our group. Take for instance the acquisition of Fraser Yachts. This acquisition has enabled our group to provide Azimut Bennetti owners Fraser Yachts’ services; management and servicing of yachts, chartering of their yachts when not used.
What is your view on the Chinese luxury yacht market?
I would say “work in progress”. While there is a lot of interest from the Chinese in our yachts, our sales have gone down a bit there. We have even designed models with karaoke rooms and such to attract their attention, but in my opinion, the Chinese yachting mentality is simply not developed enough. Education about the benefits of yachting is key in the years to come. Benefits of taking your family and friends for a happy day cruise. Benefits of taking business partners on board. We trust that the Chinese market can burgeon at any time and we are fully prepared for such with a strong team and a well-organised dealership network across this huge country.
What is your sentiment on the Indian boating scene?
The Indian boating scene is behind every market at the moment but it has a huge opportunity to catch up. It is behind China because China was quicker in building infrastructure. It is behind Brazil because they too have been building infrastructure and they love the sea. It is also behind Thailand, where we have a lot of marinas and tourists on the water. So India has to catch up not just in infrastructure but fill in the psychological gap and nurture a love for their water, which I see happening slowly but surely.
What about the rest of Asia? Hong Kong, Singapore, Malaysia, Thailand, Indonesia?
Hong Kong has a healthy yachting mentality, no taxes on yachts, yet there is a problem there with lack of berthing. We tried to work with the authorities there on a marina, but the bureaucracy is very conservative. They need a few years to even study a plan, let alone make a decision. Singapore with four marinas has been an interesting and growing market over the past years for Azimut. Malaysia has some buyers for big units. Thailand is becoming a charter destination and has an active boating scene. Indonesia has incredibly beautiful waters and potential, yet taxes are very high as in China and there are not enough marinas in operation. Infrastructure is key to healthy market development. So overall, despite some serious infrastructure issues, we maintain a strong focus on South East Asia.
With your daughter in the company and having an operational role, any plans to prepare a well-deserved retirement?
No I am not slowing down, I like working and I am passionate about my company. Naturally I enjoy boating, I had my own Azimut 103 for several years. However, this summer I cruised aboard a brand new 93ft Delfino. We had 10 people on board and I am happy to say there was not a single defect even though we were the first to use the boat. We had an idyllic cruise all up and down the Italian coast, Sicily and the Amalfi Coast without one problem. Now, that made me proud to be owner of the company.
Your last words for today?
The market for pleasure boating is continuing to expand, but not as in the past. Growth will still take place thanks to development in emerging countries, but in the West a phase of stabilisation is anticipated, with a very low development rate. Competition in such a market becomes always more selective, and customers become more and more wary and hard to please. There is no room for making any mistakes: you always have to be the best. The only change with respect to the past will be the fact that we will need to concentrate all our energy on the quality of the product and services that we offer to our customers, always introducing more value to what we do.
This interview first appeared in Issue 32 of Yacht Style.