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Invigorating Lebanon’s boatbuilding sector

(The Daily Star/HO)

BEIRUT: In history books, Lebanon is famed for being the home of the ancient world’s pre-eminent boatbuilders, the Phoenicians. Today, however, only a handful of boat manufacturers exist in Lebanon.

Antoine al-Hajj, chief executive officer of Phoenix Boats International, is hoping to turn that ebbing tide. While he initially planned to establish his business in the United States, Hajj said that economic considerations brought him back to Lebanon.

“To start a factory in the U.S., it would have cost between $20 million and $30 million, plus labor costs,” he explained. “In the U.S., it will cost me $150 per hour per employee. Building boats is a profession, and anyone can do it.”

After analyzing the market, Hajj decided to launch his company in Lebanon, in part because of the low labor costs. “It costs me approximately $150 per week per employee,” he said. “It’s 40 times less [than in the States].”

Phoenix Boats International is a quintessentially Lebanese company, with a factory in Tyre. “They are the most experienced Lebanese boatbuilders in Tyre,” he said. “They don’t have much experience in luxury boatbuilding, but at least they have the knowledge to start working.”

Carpenters have been painstakingly building wooden molds, which will serve as models for the final fiberglass products. Other employees are finalizing details of the leather interiors.

In the coming weeks, the first Phoenix boats will hit the water. “We’re building boats for multiple levels. We’re talking about 6, 8 and 10 meters, at least for the first year.”

Hajj is planning for growth, however, and is willing to venture into new waters. “We have a pending order for a 15-meter catamaran. This takes us to another field, to another place.”

Hajj hopes that high-quality products with unique finishing will distinguish the Phoenix brand. “I’m trying to build high-quality boats. We’re trying to do something better, at the same price if not cheaper than other brands.

“We’re going to introduce specifications into the market,” he said confidently. “The finishing touches are very important.”

But manufacturing boats in Lebanon poses distinct challenges. Getting the right equipment, he said, has proved difficult at times. “Like boat sound systems, for example ... If I want to buy it from the U.S. it would cost between $70 and $150. Here in Lebanon it would be $600, $700 because it’s an exclusive market for a specific client. Also, 99 percent of products are not in stock, and must be imported.”

Still, Hajj is catering to an international clientele, because “the Lebanese prefer to buy from abroad,” he said. “It’s better for us to create an international market, then our brand will be more respected on our home ground.”

Also, the absence of yacht loans in Lebanon has slowed the national market, he says. “As a Lebanese company, we are trying to deal with banks in Lebanon to try to create something called a yacht loan.”

Today, buyers must pay cash or take out a loan to buy a yacht. “But not anyone can get a loan for $75,000,” he said. Personal loans, he added, have high interest rates.

Hajj plans to sell Phoenix boats in dealerships across the world, with an emphasis on Middle Eastern markets.

He hopes that Phoenix Boats will reinvigorate Lebanon’s boatbuilding sector. “Lebanese have big potential,” he said.

“If we succeed in our endeavor, I’m sure others will follow.”

 
A version of this article appeared in the print edition of The Daily Star on May 19, 2014, on page 5.

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Summary

In history books, Lebanon is famed for being the home of the ancient world's pre-eminent boatbuilders, the Phoenicians. Today, however, only a handful of boat manufacturers exist in Lebanon.

Antoine al-Hajj, chief executive officer of Phoenix Boats International, is hoping to turn that ebbing tide.

After analyzing the market, Hajj decided to launch his company in Lebanon, in part because of the low labor costs.

Manufacturing boats in Lebanon poses distinct challenges.

The absence of yacht loans in Lebanon has slowed the national market, he says.

Hajj plans to sell Phoenix boats in dealerships across the world, with an emphasis on Middle Eastern markets.

He hopes that Phoenix Boats will reinvigorate Lebanon's boatbuilding sector.


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