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Home > Cruise News Archive > Cruising's Titans of Industry Face Off at Seatrade
Date Published: March 14, 2006
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Cruising's Titans of Industry Face Off at Seatrade
In a relatively spark-free experience, today's opening event at Seatrade -- "The State of the Industry" -- focused exclusively on the "Big Four" (the fleets of Carnival Corporation, Norwegian Cruise Line, Royal Caribbean/Celebrity and MSC Cruises). Editor's Note: Luxury lines will have their say later today, in a separate session on the "State of the Industry Beyond the Big Four."

While matters both mundane (fuel prices) and intriguing (just how big, ship-wise, is too big?) were raised by audience members and panelists, the most interesting stuff for cruise travelers comes down to the following:

Did you know that those lines account for a whopping order book -- for new ships between this year and 2009 -- that will provide 28 new ships worth $16.3 billon priced at an average $200,000 per berth?

Last year, 11.18 million people cruised worldwide at 103 percent occupancy -- and of these 9.67 million were from North America.

Key destinations in terms of popularity weren't too surprising -- up to a point. The Caribbean and Alaska were way ahead; Hawaii, thanks in part to NCL America's year-round presence, had crept up to number three; and (here's the surprise) Northern Europe actually trumped the Mediterranean!

Big trends? "Mass exclusivity," a contradiction in terms that cruise line executives hope you won't notice. That just means ever-increasing niceties (beds, food, concierge services, suites, butlers, etc.) on ever-growing ship sizes.

Don't know if you're among 'em -- but all the panelists agreed that "today's" cruiser (presumably from baby boomers to, er, just babies) are inherently different from the generation of travelers that preceded them. They're exploring style and collecting experiences "rather than watches and postcards" (according to one panelist). They want to travel to all seven continents but travel in style.

While there was much chat about fuel costs and their impact on cruising, no one dared to introduce the topic of fuel surcharges (at this point only luxury lines have levied them). Still, said Royal Caribbean's Adam Goldstein, the vast increase in fuel costs has inspired his line to reduce speeds and offer incentives to captains and engineers to increase fuel efficiency. Celebrity's Dan Hanrahan noted that on Millennium-class ships, the line was in the process of switching 18,000 halogen bulbs to LED "because they burn less power and throw off less heat, which means less pressure on air-conditioning."

You know that $20 you pay to eat at a ship's alternative restaurant, the $5 for a Ben and Jerry's ice cream sundae, the $10 day pass for the thalassotherapy pool -- all new and more innovative onboard offerings that are not accounted for in the ticket you buy? Well, what they mean is that your cruise fare actually accounts for just 78 percent of the revenue. The onboard miscellany adds up to 22 percent. Think about that the next time you budget for your vacation.

The controversy for cruisers over the increase in a la carte-priced items was addressed with Holland America's Stein Kruse noting that "there are more for-charge items, but the basic staples of the cruise experience haven't inherently changed." And those would be? A place to sleep, different ports to visit, fun-in-the-sun activities and entertainment, and good-enough food, to name the majors.

How big is too big? An issue dear to Cruise Critic readers in light of our recent poll of the same name (which basically came to the conclusion that you can get too big) was addressed. The debate basically revolved around the announcement, by Royal Caribbean, that in 2009 it would introduce a ship measuring 222,000 tons and carrying 5,400 passengers. Too big? Scoffs Rick Sasso, whose new MSC ships represent that line's largest ever (while still continuing to sail with those in the mid-range), "Every time the industry builds something more dramatic people come to cruise. The variety is what's attracting. Bigger is better, too."

Celebrity's Hanrahan, which recently announced its biggest-ever Solstice class, says that "I'm not sure size matters. Whether you stay in a small Ritz-Carlton or a large Ritz-Carlton you'll be guaranteed the same kind of terrific experience." On the other hand, Holland America's Kruse notes that for deployment flexibility reasons, he doesn't expect HAL to build a ship that can't fit through the Panama Canal anytime soon. Carnival's Dickinson was uncharacteristically quiet until he piped up with a comment about the future. "I don't think the end is in sight as long as people have vision -- and ego."

There was a bit of talk about Asia, in light of Carnival Corporation's move to establish a Costa ship in Asia to attract Asians (as opposed to serving North Americans and Europeans). There was no consensus from other lines except for the fact that everyone realizes Asia will be the major growth area for cruising. "This century is going to be a lot about Asia," says Royal Caribbean's Goldstein. "If we want to stay vibrant we will have to reckon with Asia." Goldstein did not, however, commit Royal Caribbean to that market.

Have questions about the future of cruising? Feel free to drop a note to feedback@cruisecritic.com (put Seatrade in the subject line) and we'll do our best to check 'em out.
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