Competitive advantages and the transformation of Taiwan's yacht industry

Ranked as Asia's number one mega-yacht producer, Taiwan's yacht making industry is mainly located in Kaohsiung, the largest city in Southern Taiwan. Although it lacks a domestic market, how Taiwan has been able to transform itself into a mega-yacht producer poses an interesting question. Through intensive interviews with three of Taiwan's leading yacht makers, Horizon, Kha-Shing, and Ocean Alexander, and one key yacht hardware accessory producer, Aritex, we analyse four factors contributing to the competitive advantages of Kaohsiung's yacht cluster: close-knit social network, flexible capability of order customisation, co-existence of contracted and corporate workers, and superior craftsmanship with improvisational ability. With the growing wealth in Asian markets, we suggest that Taiwan improve its infrastructure so as to facilitate yacht production expansion and to promote yachting recreation.