As the cruise industry looks back on its most challenging 18 months in history, the Cruise Lines Industry Association (CLIA) celebrated a milestone — its 35th anniversary. At a recent cruise conference in New York, CLIA cited an average growth of 7.4 percent since 1980 and the arrival of 118 new ships since 2000.
In 2008/2009, the cruise industry survived rising fuel prices, the H1N1 virus, a stock market crash and its resulting fluctuations, a housing crisis, corporate restructuring, stimulus plans and bailouts, as well as declining and fragile consumer confidence.
"CLIA's 25 member lines and travel agents responded amazingly well to the economic crisis and have put themselves in a very strong position to succeed in 2010," said Terry L. Dale, president and CEO. "In many important ways, if you have to have these challenges, cruising is the industry to be in. We have continued high cruise vacation interest and demand and an under-penetrated market of millions who have never cruised before. Approximately 80 percent of Americans have yet to cruise, and the opportunity is even greater in Europe and abroad where cruise vacation adoption is growing at an accelerated rate."
Despite the economic turmoil of 2009, the cruise industry actually showed some growth. A total of nearly 13.5 million guests are forecast to have sailed last year compared to just more than 13 million in 2008,with U.S. and Canadian residents accounting for 76.5 percent of guests and 23.5 percent sourced internationally. The volume of international guests has been growing consistently. In 2000, less than 10 percent of the guests sailing on CLIA-member cruise lines were sourced to international markets. The CLIA fleet in 2009 sailed at an average occupancy of 104.4 percent, with an average length of cruise of 7.2 days, so passenger volume continues to keep pace with capacity.
CLIA forecasts a total of 14.3 million passengers in 2010 — 10.7 million from North America and 3.6 million sourced internationally, representing a total increase of passengers of 855,000 or a growth of 6.4 percent.
After introducing 14 new ships representing a total investment of $4.7 billion in 2009, the CLIA fleet will add 12 new vessels this year, an investment of $6.5 billion. The new ships range in capacity from 101 to 5,400 passengers.
The newest members of the CLIA fleet will include:
- American Cruise Line: Independence (101 passengers)
- Avalon Waterways: Felicity and Luminary (138 passengers)
- Celebrity Cruises: Celebrity Eclipse (2,850 passengers)
- Costa Cruises: Deliziosa (2,260 passengers)
- Cunard Line: Queen Elizabeth (2,092 passengers)
- Holland America Line: Nieuw Amsterdam (2,100 passengers)
- MSC: MSC Magnifica (2,550 passengers)
- Norwegian Cruise Line: Epic (4,200 passengers)
- Pearl Seas Cruises: Pearl Mist (110 passengers)
- Royal Caribbean International: Allure of the Seas (5,400 passengers)
- The Yachts of Seabourn: Seabourn Sojourn (450 passengers)
In addition, CLIA member lines have 26 new ships on order between 2010 and 2012 — 23 ocean-going vessels and three built for river/coastal cruising. This represents a net increase in capacity of 18 percent, or 53,971 beds.
At the end of 2009, CLIA surveyed its member lines and member travel agents and found that 75.7 percent anticipate an increase in sales in 2010 and another 11 percent expect to stay even with 2009. Most agents surveyed look forward to sales increases of approximately 15 percent.
Eighty-three percent predicted an increase in booking volume of 10-20 percent during Wave season (January-March).
High interest in contemporary cruising was expressed by 73 percent of clients, followed by premium cruise lines (49.7 percent) and destination/niche cruise products (47 percent). One of the most dramatic findings was the high interest in river cruising by 34 percent of clients.
According to agents, the anticipated top cruise destinations for 2010, by volume of sales are: The Caribbean/Bahamas, including eastern Mexico; Alaska; the Mediterranean, including the Greek Islands and Turkey; Europe; Hawaii; the Panama Canal; the west coast of Mexico; Bermuda; European rivers; and Canada/New England.
The top "hot" destinations include: the Mediterranean, the Caribbean, Alaska, European rivers, Europe, Hawaii, the Panama Canal, the west coast of Mexico and the Bahamas
While remaining relatively short, the cruise booking window is also lengthening, according to CLIA. Agents report an average window of just more than five months (compared to around 4½ months in 2009), with only 30 percent of clients booking less than four months out (compared to 39 percent in 2009).
Couples dominate cruise demographics, although agents report continued growth in families, extended families and friends traveling together, as well. Seniors also continue to be an important segment.
Fifty-three percent of agents expect to book more new cruisers in 2010 while 37 percent expect their client mix of new and repeat customers to remain constant. CLIA agents continue to be very optimistic about travel in the next three years, particularly cruise travel — 71 percent describe themselves as "very or extremely optimistic."
Top Trends for 2010
- Strong interest in group and affinity travel (for some lines, this could be more than 40 percent of their business).
- Popularity of theme cruises, notably music, food and wine cruises.
- Some lines are increasing their line-up of onboard speakers for enhanced enrichment programs.
- Cruise lines expect baby boomers and repeat cruisers to be the biggest growth markets.
- Historical and cultural shore excursions tend to be the most popular.
- Shipboard spas continue to attract cruisers, with some lines reporting use by 40-50 percent of passengers.
- New green, environment-friendly shipboard technologies are being utilized, such as solar power, advanced water treatment systems, Alternative Maritime Power, fuel conservation, innovative hull treatments and more.
- Executives said many CLIA member lines have plans in place to boost marketing efforts for 2010 to ensure continued demand, including taking full advantage of social media sites, including Facebook and Twitter.