European summer deployment strong
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Emerging markets and strong emphasis on European summer deployment are the main features for this year, as highlighted in the recent 2012 Cruise Industry News Annual Report.
The Caribbean remains the cruise hub during the cold winter months, as passengers chase the warmer conditions of the Caribbean region, while South America is now seeing a plateau as cruise lines battle high port fees and regulatory issues.
Australia is now the fastest growing market in the world, with more ships deployed there and all fighting for limited berths in Australia’s ports. Itineraries are generally longer due to distances needed to be covered and with population at around 23 million considered relatively small, is now starting to signal that the market will reach its ceiling now expected in 2013 and other areas in the Pacific Rim may need to be opened up to cruise to absorb the large build up in capacity.
With the recent reduction in Alaska’s head tax the region again is gaining momentum but still lags some 15% behind the Alaskan 2008 cruise activity.
There has been a major shift away from the California and Mexican coast due to ongoing political issues and heightened crime rate.
Asia remains a wildcard with many lines touting China as the next big thing. More ships are now deployed in Chinese waters than ever before, however changing government regulations serve as a deterrent to many potential entrants. The growth of the middle class in China would suggest a significantly more robust cruise market. To date the market has only seen a line-up of older ships, it was only recently when a couple of cruise lines such as Costa and Royal Caribbean committed relatively new hardware to that market but so far no other entrants have rushed to get in . Both lines predict strong growth, albeit from a very small base in the coming years.
Japan previously seen as a major growth opportunity in the 1990s never eventuated and remains a very small market.
Ships still need to go where passengers want to go, and as the ship fleets keep on growing, the planet seems to be getting smaller – at least in terms of viable opportunities and cruising regions. Lines do move ships to regions that offer best revenue opportunities but there are so many other factors that come into the equation such as geo-political issues, fuel costs, ticket prices, onboard revenue, other governmental regulations all making ship deployment and itinerary planning ever more challenging to make it a success.