Luxury yacht makers sail into China
The luxury yacht industry has sailed some testing waters since the financial crisis hit, but things are looking up as European yacht builders cruise towards emerging markets in search of expansion.
As the London Boat Show comes to a close this weekend, major yacht companies at the event said entering new markets is the key for growth.
The Middle East and South America are being flagged as growth areas for yacht builders, but it is another country at the forefront of their mind.
"The country on everyone's lips is China. We want to be part of that," Chris Gates, managing director of Princess Yachts told CNBC in a phone interview.
Yacht sales in China are set to grow 13 percent from 2012 to 2017, according to a report by TechSci Research. Added to the fact that the number of Chinese with wealth of more than $500 million is expected to increase from 1,500 at the end of 2013 to 2,300 by 2017, according to Ledbury Research, the world's second largest market is an attractive place for yacht builders.
(Read more: China's rich buying up yacht companies)
But gaining a strong foothold in China will not be an easy task. Firstly, European yacht exporters are subject to a 43 percent import tax on vessels sold to the mainland.
Secondly, and perhaps the most challenging to shipbuilders is the need for a cultural shift in China.
"The Chinese are less interested in the outdoor living benefits that a luxury yacht can bring than many other nationalities, and tend to use their yachts more for business entertaining and building relationships," Stuart Rutherford, research director at Ledbury Research, told CNBC in an emailed comment.
Chinese businessmen are starting to also see the potential for yacht sales in their own country. Last summer, Dalian Wanda Group, the China-based property giant, acquired control of British yacht-maker Sunseeker International for around $500 million.
Yacht-makers insisted that attitudes towards boats in China, a country not typically associated with sailing are beginning to change.
"Whilst it does not have a history of leisure boating, there are a lot of marinas being built in China and a substantial growing interest. The attitude change is happening slowly. The infrastructure is being built," Kevin Gaskell, CEO of British company Fairline Yachts told CNBC in a phone interview.
"The philosophy is different. Boats are seen as a vessel for entertainment rather than a way to explore the high seas."
Accordingly, yacht builders have had to leverage their histories and designs to appeal to the high standards demanded of Chinese consumers. This includes manufacturing and marketing the boats as places of entertainment and business, meaning many of the yachts have karaoke rooms in them, a favorite Chinese pastime.
(Read more: The world's largest yachts 2013)
Gaskell said Chinese customers are also very excited about the "Britishness" of the company's yachts and "brand Britain" plays a key role in their appeal.
Princess Yachts' MD Gates said they used their position as a company under the LVMH house, to create a Fendi interior in their Princess 32M boat to appeal to China's love of luxury fashion labels.
—By CNBC's Arjun Kharpal: Follow him on Twitter @ArjunKharpal