Smooth sailing for yacht builders despite economy

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The well-heeled buyers of the floating mansions are increasingly coming from emerging economies in the Middle East, Russia and South America. The source of their wealth runs the gamut technology, venture capitalism, new industries. And, yes, oil.

"There are a lot of people with new wealth looking for relaxation and enjoyment," said John Dane III, president of privately owned Trinity Yachts, the largest U.S. builder.

These days, the biggest problem at Trinity's shipbuilding yards is having enough workers to handle the 24 custom contracts the company currently is working for the luxury vessels.

"Nobody is buying these yachts because they need them," said William S. Smith III, Trinity's vice president. "They're buying them because they want them."

Another builder, YCO Deuxil PLC, has nine yachts under construction more than double from last year. Sales for the first five months exceeded the entire amount for 2007, the London-based company said.

YCO Deuxil, which also provides services for super yacht owners, saw its profit more than double to $549,367 in 2007 over 2006.

According to Camper & Nicholsons International, a broker of yacht sales and charter contracts, there are about 3,800 yachts over 80 feet in service around the world now. About 1,800 of those have been built since 2000. The study predicts that that by 2010, there will be 5,000 such yachts on the water.

"There's not enough supply," said Ed Slack, editor of International Boat Industry. "It takes two years to build some of these yachts and the demand hasn't slowed down."

So far, Trinity's largest vessel has been a 192-foot yacht that would carry a replacement price of $60 million to $65 million. The company is working a 242-footer that will have a price tag in excess of $90 million.

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