Sunseeker CEO Andrea Frabetti Bets on OneWater in the U.S.
Despite widespread challenges, Sunseeker stuck to its strategy through the Pandemic and the portfolio growth remains on schedule as the Poole, U.K. builder continues a whirlwind series of new product launches. But much more is happening at Sunseeker than just new models. We sat down with CEO Andrea Frabetti to find out about the changes being made and the outlook for the future. Perhaps the most important decision was to appoint OneWater the U.S. distributor/dealer.
U.S. Market and Beyond
Q: How important has the U.S. market become for Sunseeker since your dealer agreement with OneWater Yacht Group was announced in early 2021?
A: This was another good move as our sales in the US exploded in 2021. Now, about 40% to 45% of our production is for the U.S. OneWater is our master dealer for the U.S. and oversees its own network of dealers. It’s listed on the stock exchange and Sunseeker is part of its growth strategy as it seeks to become the No. 1 yacht dealer in the U.S.
Prior to OneWater’s appointment, we had lost a little market share, especially in Florida. With OneWater, we’re getting back our market share and now looking for more. OneWater invested a lot in new facilities, especially at the Roscioli Yachting Center purchased last year. Roscioli will soon have a year-round Sunseeker showcase for our yachts, which will make clients feel like they’re in a good family. This facility is essential for the U.S. market as it’s very important for a U.S.-based customer to have a local service department.
Challenging Era During COVID
Q: Andrea, you were promoted from Chief Technical Officer to Chief Executive Officer in June 2019, so after close to three years in the top job, how do you reflect on the huge ups and downs during this unique period?
A: It has been a very tough time, not only for Sunseeker but for most companies in the world. However, I’ll never forget how much we’ve done together as a team in a very difficult time. Personally, I’m happy with the fact we’ve delivered on all the promises we made in late 2019 and have stuck to our product development schedule.
Q: Sunseeker recently announced a forward order book of about GBP500m (about U.S. $700 million), the largest since Wanda Group became the majority shareholder in 2013. Considering complications with suppliers, shipping and trade, how has Sunseeker reorganized to try to keep up with demand in the Covid era?
A: The situation needs a management team that’s creative, knows its job well and can apply counter measures to any situation. I’ve been very lucky to have the right people working for Sunseeker. We’ve been able to come back strongly, probably stronger than ever, and have improved our production capability and better supported our supply chain.
We’re not looking to increase the overall number of boats. To give some perspective, we built 160 yachts in 2019 and in 2022 we expect to produce about 135 yachts. Instead, we’ve been focusing on increasing the portfolio from 11 models (in mid-2019) to over 20, with many of the main products now focused on bigger sizes. We’re less focused on overall volume of production and concentrating on quality, reliability, delivery time and enforcing our position at the top end of the market.
Moving Forward
Q: Having had to reduce numbers during the Covid era, are there plans to increase staff and apprentices?
A: During 2020, we had some reduction, then we’ve been coming back, hiring people and recently started recruiting 50 technical apprentices. We predict the overall financial turnover in 2022 to be a little bit more than in 2019, before Covid, so we’ve resized the company accordingly.
Growing the Lineup
Q: Why was there such a need for new models?
A: When I joined, the Sport Yacht range had only one model (74), so we added the 65 in 2020 and you’ll see another in 2023. I believe if you’re in a segment, you need to be strong. One product is not enough because a customer that loves Sport Yachts wants to move to a bigger one. We’ve been developing the Sport Yacht and Predator ranges, and since 2019 we’ve also added the Performance range with the Hawk (38) and Superhawk (55), which are part of the company’s heritage.
The Yacht range is unbelievable because we now have the new 88 Yacht and 90 Ocean launched last year and the 100 Yacht coming this year, plus the 90 Ocean Enclosed. The Ocean models (which span the Yacht and Superyacht ranges) start from 90’ (27.4 m) today but will move into smaller models while ranging all the way up to the 50M (164.04’) Ocean. In the meantime, we’ve had to renovate existing ranges, like upgrading the Manhattan 52 to 55 and the 66 to 68.
Q: What has driven your schedule for five new models in 2023 and four more in both 2024 and 2025?
A: The goal is to have constant renovation of a range of 20 to 25 models, mixing upgrades every four to five years with some completely new products. We don’t want to be launching seven new models each year – we only did that in 2021 because we had a lot of catching up to do.
The schedule is also based on regulating the investment we’re making into new products, which is GBP35 million (about US$47 million) over five years. If you launch eight new models in one year and two the next, you have these huge peaks and troughs in cash requirements. We had a big surge of investment to get the portfolio to where it is today, but we have a consistent investment profile over the coming years.
Predator Expansion
Q: Several boats have been added to the Predator range: the 55 EVO (2021), 74 XPS (2021) and 65 (2022). Have these models lived up to your ambition for the range to be distinguished not only by its exterior but also by its interior design language?
A: Yes — and this has been reflected in Predator sales, which have dramatically increased. For example, the Predator 74 was launched in January 2018, but after a year, sales hadn’t matched expectations. The boat is fantastic, so last year we launched the XPS version, which has a renovated interior that’s similar in feeling to the new 65 and 55 EVO and now we’ve covered the range.
Sunseeker is top-quality technically, in terms of performance and in exterior design, but when I joined, I thought the interiors weren’t at quite as high a level. We made the changes quickly and the sales rewarded us in a good way. I met some customers who said, “We were waiting for that because we love your boat, the quality and the exterior design, but when we entered the boat, we didn’t say ‘wow.’ Now, we say ‘wow.’”
Inspiration for SkyHelm
Q: The 65 Sport Yacht has attracted a lot of attention for its SkyHelm. What was the inspiration behind this?
A: In April 2019 (when Frabetti was still CTO), I was at a private show for Sunseeker customers in Poole. I saw so many clients arriving in two-seat sports cars and supercars. The car park was full of brands like Aston Martin, Bentley, Lamborghini and Ferrari. I could see how much they loved driving these cars.
At the same time, I was aware of the speed limits in the UK, so I thought I’d like to give our clients the experience of driving something sporty in an environment where it’s safe to go at full speed. I decided to design the entire Sport Yacht concept around that, really underline the difference between a Sport Yacht and a Yacht.
Customers don’t want to compromise on the interior; they all want large spaces, large galley, comfort, everything! The ranges had different external lines, but it’s not enough. We needed to have an experience that starts from a different hull, different propulsion and a different way of driving a boat.
On a Sport Yacht, we need to feel the sport, feel the adrenaline, to drive it like it’s your sports car in an environment where you can enjoy it and not worry about red lights or speed limits. The SkyHelm was the result. You can turn full speed in a short space and feel low, close to the water. However, you still have a large volume and a lower helm where it can be driven like a Manhattan or a Yacht model.
Q: The first Pacific Edition of the 68 has been delivered. What are your thoughts on this layout, which has more seating in the saloon and a ‘grand master’ suite with private lounge?
A: I really like the changes. This was developed by Douglas Culverwell (Sunseeker’s Director of Distributor Development) with NextWave Yachting, the Hong Kong dealer. They asked us to consider this layout and it was great to hear how it could help our dealers in Asia. We listened carefully and I think they got it right.
In Europe, most people like to have four cabins and can compromise a little on the salon, but the Pacific layout is great and still offers three wonderful cabins, which is probably more than most owners need. We didn’t call it an Asia version because we’ve also been selling the Pacific version in the US and even in Europe, too.
Yacht Range Overhaul
Q: Do you regard the 90 Ocean as the most ‘radical’ Sunseeker design since you’ve been CEO?
A: When I joined Sunseeker, the plan was for the 90 Ocean to succeed the former 86 Yacht. Instead, we made a brave decision to continue with the Yacht design language on the new 88, while the 90 Ocean is a completely different niche, for a different customer.
Today we’re fully booked for production for both models despite many people saying the dimensions are quite similar; that’s because the experience and customer profile are different. The 88 Yacht is more formal, has a very attractive interior, while the 90 Ocean is larger and more practical. It was a brave decision, but it has proved the right one. We’re also developing smaller and bigger Ocean models.
X-TEND’s Popularity
Q: What has been the reaction to the X-TEND sunbed offered on all new Yacht models?
A: It’s an option because at the beginning we didn’t know many customers would want it, but I’d estimate 95 percent of orders of models with the X-TEND option have chosen it. It looks like people want it!
Q: How do you think the market will respond to the master suite on the 100 Yacht, where sliding ‘sunroof’ doors lead to the foredeck?
A: This design doesn’t work if it’s simply added to an existing boat; it only makes sense if it’s integrated into the overall design. The guest area is designed to be on the starboard side, so on the port side of the foredeck, there’s a crew staircase directly to the galley because service needs to be quick — nobody wants a cold Espresso. On a yacht this size, it’s fundamental to separate guests and crew, but although the foredeck is a private area for the owners, it still needs efficient crew service when required.
Q: Fast forward to mid-2024 and what do you hope to have achieved in five years as Sunseeker CEO?
A: A company needs stability and sustainable growth, not vertical growth of 15% or more every year. Vertical growth doesn’t allow your processes to be consolidated, because you’re always looking for more space or shipyards, personnel and so on. It becomes a game that doesn’t benefit the customer, who wants quality, service and value for money. In over three decades in the industry, I’ve seen that any huge, sudden growth can initially feel good but later can be a disaster.
Everything must be constantly consolidated, starting with the dealer network. Even before we started to consolidate production or introduce new models, we had to consolidate the dealer base. We need to ensure we’re looking after the dealer in each region and that they’re looking after the clientele and that they all still love the brand. Every part of the puzzle needs to fit, and you can only keep managing all the aspects if your growth is controlled.
So, my wish is that Sunseeker would have constant but manageable growth, to feed our production line constantly — so it’s not too much at once, yet you don’t lose slots — and to maintain our workforce, our position in the market and our clientele.