PAOLO VITELLI

The pride of being the first in the world for years. To have been able to bring «poetry» and «passion» to the industry. To confirm, day after day, how important it is to have an ethical family behind a large company. To have had the right intuitions and not allowed himself to be dazzled by shortcuts which are tempting as they are dangerous. Today, 52 years after the founding of his shipyard, Paolo Vitelli can be justly proud of the path he has taken. He welcomes us in the meeting room over- looking the peaks of the Val di Susa, at the Azimut-Benetti headquarters in Avigliana, wearing velvet trousers and a Scottish shirt to reveal his second deep passion, love for the mountains. Before starting what will turn out to be a 360-degree overview of the state of health of the world of boating, Vitelli shows us the book published two years ago to mark Azimut-Benetti’s 50th anniversary. This is also a litmus test: sober, concentrated, and no-frills like its author, who edited it together with Marila Guadagnini and his daughter, Giovanna. «I didn’t want a coffee-table book», confirms Vitelli. «But rather a volume that took stock of Italian boating, with a broad historical retrospective, edited by Marila, bearing witness to these 50 years of the company and with glimps towards the future». He is proud to say that it will be his daughter Giovanna to ensure the product’s continuity of success: she will be leading the company aided by a top-notch management which is able to carry on the mission along the marked out path.

More than fifty years of Azimut-Benetti. What are you most proud of?
The fact that we created an industry. Our greatest service was to transform boating from an industry that was about impressive artisanship, play and poetry into an efficient production system, a «global company».

How did the idea of industrializing the process come about?

I’m from Piedmont, I like to do things rationally. Serial production, resulting in lower unit costs, means expanding the market. This logic has always appealed to me as the great grandson of industrialists; we’ve been an entrepreneurial family since 1903. It seemed logical to me to think that yachts were a dream, but it could become a replicable dream, to make it more accessible to a broader range of people, and give it more market longevity. Both in the automotive world and in the nautical world those who have only thought about the dream are finished, think Bugatti, Isotta Fraschini, and as far as boats Italcraft, Posillipo. The virtuous examples are Porsche and Louis Vuitton who knew how to start from that dream and, incorporating the best values, to create a serial production. They had the courage, the ability, and the energy to transform what we like to call dreams or magic into something reproducible and with fair economic value.

And with yachts, who else has taken this path?

The path of world-class companies: very few. The path towards serial production: Italy has first-class examples. The first boat produced in series was built in Naples, it was Fiart’s Con- cita. Rio also quickly understood the logic of it, but surely credit must be given to Cranchi for having given a real boost to serial construction, turning it into a trump card. Then Baglietto, thanks to the genius of an American, Richard Ross, started to make boats for actors and royalty (the famous metric series: 18, 16, and 14M) produced with Ford esque criteria: long assembly lines where the boats moved while the workers stayed in the same place. I don’t want to forget Riva, but then it’s had a lot of ups and downs.

Is Riva one of your regrets?

Not exactly. I wanted to buy it, we weren’t able to. I had made an offer but the financial funds were constantly raising the stakes. Nothing has been done about it.

Although, over the years, the results haven’t been anything to get excited about, the boating industry is still fascinated by the stock exchange. What is a shipyard looking for when it’s listed?
Essentially it’s looking to monetize. An idea that I don’t share and I’ve never made a secret of that. For me, the company must add value to its entire universe, first of all to its employees, to its clients and only after that the shareholders. A major banker, Maurizio Sella, always told me: «rich company, poor family». This is the key to the success of both the company and the family. Moreover, experience confirms that the Stock Exchange is not a panacea for boating, Rodriguez in France failed after it was listed, it happened to Aicon, the Bénéteau family regrets the choice, and even for Ferretti it hasn’t proved to be a winning idea. Getting quoted only makes sense if you have a project but you don’t have sufficient means to support it. I came close only once, when we were in negotiations for buying out the American group, Brunswick, which would have been a major undertaking and we would certainly have needed external resources.

Do you think it makes sense to pursue consolidation through acquisitions?

In boating, it could make sense. Serial production of an 8-meter boat is one thing, semi-serial production of an 18-meter one is another. Producing a 24-meter pleasure craft is something else entirely, not to mention the big yachts. Rounding out your offer in specialist areas through the acquisition of another company that is familiar with that sector can be quite effective. I was very happy when I bought Gobbi: I didn’t know how to build small boats with robots like Angelo Gobbi did. Then, unfortunately, the management destroyed everything.

Do Italian shipyards continue to lead in pleasure boating?

Our added value on design and innovation continues to be acknowledged, so I could say that our position has even strengthened. This has perhaps remained the only luxury sector in which Italy continues, without question, to excel. Not only for production volume, but also in terms of creativity, design, and recently, technology. We are at the top in the 24-45 meter range, where the French and the English are less competitive. In the 50-80 meter range, the Italians are very good. They have made great progress and are considered to be on almost the same level as the Dutch. The market perceives this progress and the Italian shipyards have acquired many orders in this segment too.

Do Italian shipyards continue to lead in pleasure boating?
Our added value on design and innovation continues to be acknowledged, so I could say that our position has even strengthened. This has perhaps remained the only luxury sector in which Italy continues, without question, to excel. Not only for production volume, but also in terms of creativity, design, and recently, technology. We are at the top in the 24-45 meter range, where the French and the English are less competitive. In the 50-80 meter range, the Italians are very good. They have made great progress and are considered to be on almost the same level as the Dutch. The market perceives this progress and the Italian shipyards have acquired many orders in this segment too.

The German shipyards have a strong naval tradi- tion, Blohm & Voss built the Bismarck, Lürssen made U-boats: does this legacy translate into a strong mar- keting tool?

What Germany has done for the military and commer- cial vessel is extraordinary, their naval tradition is very strong, but not all shipyards have been able to trans- form it into high-quality pleasure craft. The same can be said for Fincantieri, despite Bora’s experience in the 1960s and recent giga yacht flops. However, naval competence remains an important added value, espe- cially when working on a large scale.

Whether they are 50-meter yachts or real ships over a hundred, design plays an essential role. How is it changing?

A beautiful, harmonious, ergonomic and well-propor-tioned design is essential for exteriors. Around 50 percent of car purchases are also based on [exterior] form.
When it comes to boats, it’s a technical design parameter, because it must contain a volume, provide thecorrect proportions, maintain a centre of gravity, as well as being balanced and modern; but, still reflects the fact that it’s an object that must be seaworthy. Interiors are a completely different story. Here I see two major trajectories. On the one hand there is Ferretti’s choice: boats that are minimally customized, relatively basic. On the other hand, there’s the solution adopted by Sanlorenzo: linking their brand with fashion and big names in design. Making the inside of the yacht like a loft, with a very theatrical effect. I see criticalities in both choices. The first, although functional in terms of sales thanks to cost reductions, is likely to suffer in the long run due to the lack of aesthetic satisfaction. As for the second, the risk is that the «wow» effect is achieved at the expense of functionality and then the product offered can be too trendy and therefore not age well. At Azimut-Benetti we want to find a synthesis, putting our focus on the needs of on-board life, with modern but timeless elegance that doesn’t go out of style and guarantees long-term value for the owner.

How is this goal translated?

By finding a third way in terms of substance and design, using natural materials and always keeping in mind the accessibility of the sea. The yacht is a vacation at sea and therefore it needs to be easy to access the water. In recent years, with the advent of Beach clubs, this need has been misinterpreted. Last summer I was cruising around the coast of Monte Carlo and Antibes in a speedboat: there were so many yachts and all those beach clubs were utterly empty! No one wants to sit around in a dark, narrow cave: you have to open it up to the sun and the sea. I think we’ve come up with a great solution with Oasis: the aft deck slopes down to the platform in broad steps and the swimming pool is situated in the middle. There is continuity with on board living.

You mentioned the use of natural materials: today how much does a boat’s sustainability affect its choice? Can it be a driver for purchase?

Building eco-friendly boats has become increasingly important: be more efficient, consume less, and use recyclable materials. These are today’s challenges. Those of tomorrow, if not of the day after that, concern the introduction of innovative forms of propulsion. I am still a fan of diesel engines. Their efficiency is extraordinary. Today, they are top tech engines unjustly punished even if the pollution they cause is generally lower compared to gasoline and electric engines (think of the battery disposal issue). It is often forgotten that boats do not brake and do not go downhill, the two instances in which cars recover energy. So, the answer is the cata- lytic diesel Euro 6, which still manages to guarantee great savings: 15/20 percent less on boats of the same size. This is due to the synthesis Azimut Benetti has found between extremely ef- ficient and often patented hulls, reduced boat weight thanks to carbon technology, and state- of-the-art propulsions such as those used on PODs. In this field, Azimut Benetti has been very innovative: they were the first to use Volvo Ips, then Rolls Royce Pods and now the brand new ZF Pods, developed both in collaboration and exclusively.
The boat I have dedicated myself to in recent years is equipped with a diesel/electric engine developed in collaboration with Siemens. It has four different functions, which combine gen- eration and propulsion using both the main engines and the generators. In addition, the use of larger lithium batteries will allow generators to be kept off at night or when you want to dive in for a swim. The boat is made of steel. Recyclability was one of the project’s main goals. In Cannes, it was awarded as the most ecological boat of the year. As a matter of fact, all our boats are now built with sustainable and almost entirely recyclable materials. We don't stop there, though. Azimut-Benetti is collaborating on a study to identify new, more profitable for- mulas to recycle fiberglass: currently, it is only shredded to get an inert substance to be used in construction. The aim is to obtain a more noble material.

Is there always a great family behind a great company?

Not always, but often. Global statistics say that family run companies are more stable over time, have better earnings in the long run, and are stronger. The family doesn’t necessarily have to intervene in company management but must give the company continuity by choosing the right managers and «keeping an eye» on the product strategy.

In the case of Azimut-Benetti, family continuity is guaranteed.

My daughter Giovanna is the ideal heir. She grew up in the company, knows the business, is passionate about innovation and design. She has already played an important role in renewing the Azimut-Benetti fleets in a less traditional direction. And she’s gradually moving closer to all the other management aspects. Azimut-Benetti's management is already well delegated and Giovanna is highly skilled and capable. I couldn’t imagine a better future for the group’s leadership. Now, I can go and enjoy the sea.