The impressive growth of new maritime projects in Egypt, together with a reduced tariff on boat imports, contributed to a soaring demand for leisure boats. Both factors interplayed to draw more local and international customers into the blooming market. Key marine developments including the Sahl Hasheesh Marina and Port Ghalib Marina in the Red Sea, as well as the 480-berth Porto Marina in El Alamein represented an ideal infrastructure for boat builders and distributors.
As the market continues to strengthen, more boat dealers are competing for importing more high performance and luxury boats to cater for the enormous demand.
Demand for boats is closely linked to personal income and the general conditions of the economy. The profitability of individual companies depends on good marketing. Large companies may create a demand for their products using economies of scale in advertising and purchasing. Small companies compete by specializing in a certain category of boats, such as fishing boats, or by focusing on a specific customer segment, such as sailing enthusiasts.
Before 2005 the leisure boats traded were mostly used ones, and yet only very few people could afford it. The year 2005, however, marked a turning point for the maritime market dynamics in general and pleasure boats in particular. It was during this year when the Egyptian government shaved off almost 90% of the customs duties on all categories of imported ships as part of the customs reform program, reducing the fees levied from 45% plus sales tax to 5 % plus sales tax.
The construction of new marinas has further contributed to the proliferated demand for leisure boats. Government and privately owned marinas were springing up rapidly all over the Egyptian coasts. New marina investments included Porto Marina, Wadi El Doum Marina , Ein El Shokhna Marina, Hurgada Marina, and Abu Teig marina, as well as the renovation projects at the four yacht clubs in Greater Cairo and Alexandria.
Another hidden cause underpinning this leap in the leisure boat demand is the change in the price of the compliment in a reversed type of pattern. The real estate boom in Egypt, and a big number of compounds that were sold in prime locations of the coast of Egypt at a price ranging from LE 500,000 to LE 5,000,000, positively shifted the demand for boats which compared to the price of the property is considered a mere accessory.
Egyptian consumer preferences and life style changes are also major factors contributing to the flourishing industry. Greater exposure to the western cultures through media and satellite channels stirred a spree for luxury items that was not there before. The more affluent population became more interested in the ostentation type of goods that turns quickly to a fad. Accordingly, more expensive boats were sold at a higher rate than other less exclusive options. In 2008, 9 teak wood Chris Craft boats were sold for an average price exceeding $400,000 per boat without a single advertisement.