A boatbuilder’s journey

The recipient of the coveted Lifetime Achievement Award at the Boat Builder Awards 2024, Mohammed Al Shaali has been widely recognised around the world as an inspirational businessman who has greatly influenced the adoption of recreational boating as a popular pastime in his home region. The Gulf Craft chairman is also a retired diplomat with more than 35 years of experience in international relations. He reflects on his industry journey.

Would you do the same journey again, having spent the past 42 years building a world-class boatbuilding manufacturer from its inception?

I really cannot say yes or no, there are so many exciting things that have happened during the journey. I do not know what I would be without it. There were so many frustrations. I thought many times I should give up! But I am part of what we did in Gulf Craft, and I think if I started again, I would still do the journey again happily, but with better knowledge and awareness. When we started, we were so naïve, thinking that the boatbuilding journey would be easy. We learnt a lot, and I’m immensely proud of what we achieved, not for myself but for the team and the country. To build an industry like boat manufacturing in a non-industrial country, in a non-industrial region and to survive and put it all together for 42 years, I think is an achievement and I am satisfied with it.

You built a formidable team at Gulf Craft; how did you start?

Selecting the team is the most important task for any business leader. The team must be resolute, loyal and most importantly, have passion. This industry is based on passion above anything else. You can have money, you can have knowledge and a lot of other things but without passion, you cannot move with this business. To this day, if I am looking to hire someone and they do not seem to have the passion to wake up in the morning and think about the business, I won’t hire them, as without an underlying passion, they won’t add anything to the business.

For a chairman or CEO, you must have passion, as you’re dealing with customers’ dreams, and the business is endlessly demanding: Handling customers’ dreams, workers’ demands, supplier problems and managing the team. It can be very tiring and without the passion and feel for the industry it is difficult to succeed. If you look at the industry worldwide companies that still have involvement from the founder are the most likely to survive in the long term. Gulf Craft is still privately owned after 42 years in business.

We have a strong relationship with all our staff, I consider we are all a family and it’s important that everyone knows that the company is there for them if they encounter hard times. We work together and I involve everyone, including those on the shop floor, in the decision-making process. My father told me many years ago that business is like making a loaf of bread, all people who contribute should have a share of it. We have a total of 2,000 staff comprising, 1,500 at the Umm al Quwain shipyard, 100 in our Ajman factory manufacturing our Silvercat range, and 400 in our Maldives facility, so we are now a substantial company in boat manufacturing.

How is Gulf Craft different from other boat manufacturers?

Gulf Craft is unusual in the boating industry in two ways. Firstly, we offer a complete range of boats and yachts from the 32ft Oryx to the Majesty 175 Superyacht which has enabled us to establish a strong brand identity in the Gulf market and increasingly in other markets worldwide as we have developed our export business in the past 20 years. To my knowledge no other boat manufacturer offers the breadth of product range that we do.

Secondly, because we are in the Gulf and remote from the main equipment manufacturers and suppliers in Europe, Asia and the USA, Gulf Craft has developed into a vertically integrated manufacturing business. We do produce a lot of the items required in boat manufacturing ourselves, such as stainless-steel fittings, windows and other equipment, as well as doing all the joinery and finishing ourselves. To do this we have over the past 20 years developed our own CAD department with over 20 designers and many CAM machines.

High and low points in the past 42 years?

I think our high point was building the largest production composite superyacht which is the Majesty 175. This was a challenge as it’s a ship, not a boat, that brought with it technical and commercial challenges over the four years it took to build and because it took place during the Covid period. In my mind, the journey was crowned by this point in 2022 when everyone in the company was proud of our achievement.

One of the low points for the company and indeed the toughest time was during the Global Financial Crisis from 2008 to 2009. At this time some 60% of the orders were cancelled within two months and we had to refund down payments, this was challenging. During Covid was also difficult because we could not sell, and we could not manufacture. We had to close the factory for some five months. During this period, we had to look after the expatriate workforce, which was some 800 at the time in terms of their accommodation and wellbeing. I’m proud that most of them decided to stay with the company during this difficult time.

During the Covid pandemic, we had very few orders but decided to invest and develop new models. This paid off post-Covid when a boom in orders came.

A high point throughout our journey has been that most customers for Gulf Craft have become friends. They trust the company and as most of the customers are a long distance away, they must trust us, particularly those who don’t know the Middle East, but see the media and think Gulf Craft is situated in a war zone!

How has the Gulf boating market changed in the last 42 years?

The problem in the Gulf boating market, in general, is that we don’t have a substantial middle-class population for the long term. We have middle-class expatriate workers, who are short-term boat purchasers. The market has also changed in the last 10/15 years as there is now a large choice of imported boat brands in the GCC for the customer to choose from. Fortunately, we at Gulf Craft decided way back in the early 1990’s to start exporting, initially focusing on Southeast East Asia. We spread our wings so that we were not solely dependent on the GCC market, which is now about 40% of our sales, with the remainder across the world.

How should new companies approach the GCC market?

While the market in the GCC, particularly in the UAE, is currently very strong, it’s also, as mentioned previously, very competitive, as with weak boating markets in the USA and Europe the region is on most exporters’ radar screen. The Gulf region has always been price sensitive and being able to negotiate is an important aspect of the sales process. The most important factor to consider is after-sales support and service in a region which is far away from most equipment manufacturers. Invariably this is a question any customer in the region will ask about. In many ways the customer relates to the car industry where long-term warranty is now common. This is something we in the industry must consider in the long term.

How important are personal relationships in doing business in the region?

It is an important factor but not as strong as it once was now the customer, with the rise of the internet, is usually very well informed. However, making the effort to visit the region and understand the local culture and doing research on how boating takes place is never time wasted.

Where do you think the industry is going in the Middle East region?

I think the UAE has become the boating hub of the Middle East, India and the Indian Ocean region. We have a large industry infrastructure to support boating in the region. After Europe and the USA, we have become a go-to destination for boat manufacture and of course, we are well situated between Europe and Asia.

What plans do you have for Gulf Craft future?

We will continue to develop new models and this year at the Dubai International Boat Show we had nine completely new designs out of a total of seventeen models on show. We are working on three new projects, firstly developing our service potential with the addition of the new service facility in Ajman which can support up to 70m superyachts with a straddle carrier and a capacity of over 500 tonnes.

Secondly, we are building a new factory in Ajman to produce our Silvercat Range, while in the Maldives we are building a new factory to support our manufacturing operations there. 

The Gulf Craft chairman counts the launch of the Majesty 175, the world’s largest production composite superyacht, as one of his proudest achievements in 40-plus years in boatbuilding