US$25-m yacht bet – Jamaica Observer

JAMAICAN American businessman Denton Douglas is embarking on an ambitious plan to take his boatbuilding business to Jamaica and is prepared to spend US$25 million, initially, to make it a success.

Douglas, who operates Monarch Yachts — a Florida-headquartered company which began operations in China and now operates two plants in Turkey — is pushing to open a yacht-building and repair facility in Jamaica and is confident that within three years it will become profitable while employing scores of Jamaicans.

“I want Jamaica to be a manufacturing hub. Over the years we have been mainly on primary goods; we export bananas, we export ore, but we never make something. We import our cars. We import everything else. I want to move Jamaica from that primary [producer] to a manufacturing hub, and I think we have the know-how. For sure we have the skills, and we have the logistics to do it,” Douglas told the Jamaica Observer on Sunday.

“We make luxury yachts, commercial boats like fishing boats. We also have ferries… for shuttling people… and our biggest business now are military boats, which is surprisingly patrol boats. We have a line of patrol boats and we have a contract for a country in Africa to do 20 to 40 small ferries… and about 10 patrol boats… We want to do that here because those are easy to build,” added Douglas, who wants to start operating locally before the end of this year.

The Munro College graduate, who received a track scholarship to study at Howard University in the United States in 1988, worked on Wall Street for years before moving into the boating business some 20 years ago.

“When I was in China we were price-competitive, [but] my idea was this: Anyone can come cheaper than you are; they can cut more corners and be cheaper. So I changed my business to quality, meaning… no one in the world can make a better yacht,” declared Denton, who now designs and builds yachts for some of the world’s super-rich.

He said Monarch’s services, which include yacht design, construction, brokerage, charters, and refits/repairs, can all be done in Jamaica, which would be convenient for many of the company’s clients.

“I want to come here and build yachts. Why? First, to be selfish. I fly 12 hours every time to Turkey and Italy to the shipyard, or 21 hours to China. An hour and a half [from Miami to Jamaica] is a lot better than flying so long,” said Douglas.

He pointed out that a customer in the US can jump on a plane in the morning, view his yacht in production in Jamaica and be back in the US the same day, something that cannot happen where he now operates in Turkey.

In addition, it will be much cheaper to build a yacht in Jamaica and ship it to the US.

“For example, my 45-footer, to take it from Turkey to the United States, it’s US$50,000. If I build that same boat here, I’m saving that much money. To take that boat from China is another US$25,000, so that’s US$75,000,” said Douglas as he pointed to the practicality of operating on the island.

According to Douglas, he is now in talks with local authorities to identify a site to set up shop, and while he would love it to be based in St Elizabeth, where he is from, for practical reasons the main shipyard will be in the eastern end of the island — either the Corporate Area, St Catherine, or Portland.

“We need access to skilled labour and access to a port. The key thing is an airport, so if an American businessman comes to Jamaica, comes to see his boat, [he can] fly in [to Jamaica in] the morning, see his yacht, and fly back. So we need somewhere that’s close to an airport where you have access to skilled labour,” said Douglas.

He added that, while his shop will be in one location, the operation could be islandwide as Monarch will operate differently from the American yacht companies which manufacture everything in a single plant.

“I want to adopt the European model, where the shipyard may be in Kingston, but the woodwork could be in St Elizabeth. The piping could be somewhere else, so the wealth and the labour skills are spread throughout Jamaica. So everyone benefits, not just one area,” declared Douglas.

He told the Observer that the plan is not just to build boats, but to establish an ecosystem that will include carpenters, welders, seamstresses, and others who will contribute to all aspects of the production of the yachts.

Douglas said he has already made contact with the Ministry of Industry, Investment and Commerce and Jamaica Promotions Corporation (Jampro) which are helping with his application for a special economic zone (SEZ) designation, while Caribbean Maritime University (CMU) has already indicated its readiness to help with the training of workers.

“What I would do first is take a bunch of Jamaicans to China and Turkey and teach them on-the-job how it works. Then, once they get a basic understanding of whether it’s aluminium welding, steel welding for marine, or fibreglass, or epoxy work, then they will come back and start working.

“And so it will be maybe 15 to 20 foreign nationals and the rest Jamaicans. If it’s 100 Jamaicans, it will be 10 foreign nationals. It’s more of a teaching model, not a working model,” said Douglas.

“It’s just once we get the right people who can learn and are extremely meticulous, then we’ll be successful. The goal is never to have a lot of foreigners working at the shipyard. It’s always to have them teach us at the shipyard. That is the only way I’m going to do it. If I was going to have a lot of foreigners, I might as well stay where I am in Turkey,” Douglas explained.

He said Monarch will be prepared to pay the tuition for Jamaicans to study at CMU and work for the company for a period under a bonded arrangement.

“But I expect many of them to move on to companies in Germany and Italy because they will be able to pay them more. One of the highest-paid engineers on a yacht now is Jamaica[n],” said Douglas.