Staying Afloat

New initiatives and new ships will support business in ’09.

By: By Marilyn Green

CLIA’s positive take on prospects for 2009 cited trends and cruise line initiatives that will support the distribution system. One of the most important is that cruise vacationers continue to use travel agents. Industry-wide, nearly 90 percent of all cruises are sold through travel agents and some lines report that agent bookings account for as much as 97 percent of total bookings. So it’s no surprise when cruise line executives are vehement about helping the agency community, as when Richard Fain, chairman and CEO of Royal Caribbean Cruises, recently told agents, "We need you now more than we did last year."

The cruise lines have come through with some strong measures to help ensure that the distribution system is healthy and able to act quickly as the economic picture turns around. An example is the Royal Caribbean family’s ASAP, the Agent Support Action Program and its new incentives for North American agents during the January and February Wave Season including: a one percent commission supplement on any cruise bookings for sailings from January 2009 through March 2010, increased coop funding for qualifying agencies, a booking incentive allowing agents to earn a complimentary cruise, a 50 percent reduction ion FIT booking deposits and a reduction in Tour Conductor credits from 1-for-16 to 1-for-10.

Likewise, the recently announced policy by Regent Seven Seas, responding to agents who have continuously protested cruise noncommissionables includes standard shore excursions in the cruise fare on select cruises in 2009, and all cruises in 2010. Also, starting in 2010, governmental fees and taxes will be included in the cruise fare; all these will be commissionable.

An unsung hero of the industry is MSC Cruises, which consistently pays agent commissions on both shore excursions and spa treatments, something agents have lobbied for heavily during the past few years.

CLIA member lines also have responded to the economic crisis with extensive consumer promotions. These include kids sail free plans, special prices on selected itineraries, enhanced shipboard credit offers, layaway and other flexible payment plans, free airfare and/or shore excursions, adjusted deposit requirements, special small group booking offers, and relaxed cancellation policies.

Above all, according to industry veteran Richard Sasso, president and CEO of MSC Cruises and chairman of CLIA’s marketing committee, the supply of new ships with innovative features on board and a mix of many domestic homeports and new ports of call will drive demand for cruising.

"This is an industry that plans ahead and invests in the future, as evidenced by the impressive number of new ships on order through 2012, and one that will contribute positively to the country’s economic revival," said Terry L. Dale, CLIA’s president and CEO. "The remarkable diversity and variety of cruises give consumers a unique opportunity to find a vacation that fits their budget even during these economic downturns."

CLIA’s fleet will add 14 new vessels in 2009 at a total cost of $4.8 billion. The new ships range in size from 82 passengers to 5,400 passengers and offer a wide range of cruise experiences including coastal and river voyages, Caribbean and European itineraries and journeys to all parts of the world.

The new ships include:
• American Cruise Line: Independence, 104 passengers (August)
• AMAWATERWAYS: ms Amadolce, 148 passengers (April) and ms Amalrya, 148 passengers (late 2009)
• Carnival Cruise Line: Carnival Dream, 3,646 passengers (September)
• Celebrity Cruises: Celebrity Equinox, 2,850 passengers (summer)
• Costa Cruises: Costa Luminosa, 2,260 passengers (June) and Costa Pacifica, 3,000 passengers (June)
• MSC Cruises: MSC Splendida, 3,300 passengers (July)
• Pearl Seas Cruises: Pearl Mist, 210 passengers (July)
• Royal Caribbean International: Oasis of the Seas, 5,400 passengers (autumn)
• Seabourn Cruise Line: Seabourn Odyssey, 450 passengers (June)
• Silversea Cruises: Silver Spirit, 540 passengers (November)
• Uniworld Boutique River Cruise Collection: River Beatrice, 160 passengers (March) and River Tosca, 82 passengers (April)

As these vessels are added in 2009, three ships will leave the CLIA fleet (to be transferred to other companies) - the Celebrity Galaxy, MSC Rhapsody and NCL’s Norwegian Majesty. The net berth increase for the CLIA fleet in 2009 will total 18,031 beds, or 6.5 percent, by year end.