Why Can't California Keep Cruise Ships?

August 2, 2010

San Diego
(7:45 p.m. EDT) -- As some homeports flourish -- New Orleans and Galveston are nabbing bigger and better ships each year, and Southeasterners now have Charleston in addition to the Florida biggies -- we can't help but notice one area that's losing out: California.

Cruise ships just don't seem to stay put in the Los Angeles and San Diego homeports. Radiance of the Seas and Carnival Elation have already stopped sailing to Mexico from San Diego, and the following ships will be saying adios in the coming months:

Royal Caribbean's Mariner of the Seas -- In January 2011, it will leave Los Angeles with no plans to return to California or Mexican Riviera sailings.

Norwegian Star -- The NCL ship is departing Los Angeles a few months after Mariner, in May 2011. That line, too, will no longer offer itineraries to the west coast of Mexico.

Carnival Spirit -- Not necessarily leaving for good, Carnival Spirit is in limbo, spending this winter sailing from San Diego and the next from Los Angeles, with an uncertain future after that.

So, Why Can't California Keep Cruise Ships?

"2011 will be a poor year, the worst in a couple of years," says Chris Chase, Marketing Director for the Port of Los Angeles. He gives several reasons why ships are leaving. "The California economy is not helpful -- ships are full, but the price point is down." Plus, last year's fears of H1N1 and now worries about Mexico's security are making people think twice about traveling to Mexico.

He also notes that Mexico has not done a good job of marketing its increased touristic options and differentiating its multiple ports. (The same reasoning has been given for a similar downturn in Alaska.) Marguerite Elicone, Senior Public Relations Specialist for the Port of San Diego, also notes the economy and violence in Mexico as having impacts on cruises out of the southernmost California cruise port.

Cruise line spokespersons paint a similar but slightly different picture, where the bottom line is the almighty dollar."We found there was too much capacity in the Mexican Riviera, and when that occurs it drives the pricing down," says Courtney Recht, spokeswoman for NCL. "There are more viable markets that have a stronger interest amongst our customers."

Royal Caribbean's president, Adam Goldstein, agrees. In his blog, he wrote, "Throughout the industry, ships normally go out full. The critical question is at what price? Royal Caribbean has tried multiple ships over multiple decades at various lengths of cruises in California. We may very well try again in the future as we would love to be back on the West Coast. But for now we are unable to generate acceptable levels of performance for Mariner of the Seas. We are obligated to our shareholders to deploy her where she can earn superior returns." Elicone also notes that Royal Caribbean seems intent on sending more ships to Europe, a region where the line can command higher fares.

Carnival, which is maintaining several ships in the southern California area, has a different view. "We are deploying the Carnival Spirit to Los Angeles for the 12 sailings as a way of providing guests with a greater variety of departure point options," says Vance Gulliksen, company spokesman.

Another point worth noting, but that no one mentioned, is the general lack of itinerary options from the West Coast. For seven-night cruises, Mexico or Pacific Coast cruises are the only options; Hawaii and the Panama Canal are only accessible on longer cruises. And, with current laws preventing foreign-flagged ships from sailing itineraries that feature only U.S. ports, Hawaii and Pacific Coast cruises necessitate out-of-the-way stops in Canada or Mexico, making for somewhat awkward itineraries. Unlike cruises out of New York or Florida with multiple itinerary options (Caribbean, Bahamas, Bermuda, even Atlantic Canada), ships on the West Coast have limited choices and few ways to entice repeat cruisers with new cruise destinations.

What Does the Future Hold for California Cruising?

Of course, it's not all bleak on the West Coast. Disney Cruise Line will be setting up shop in Los Angeles in 2011, and Princess and Crystal will continue to have a presence there. Holland America and Celebrity continue to sail from San Diego.

And the ports are working hard to attract cruise lines. The Los Angeles port is undergoing cosmetic upgrades, such as a new paint job on the entire 100,000-square-foot terminal, and the port is looking to enhance the customer experience with a better roadway layout, new gangways to get people onboard faster and audio-visual equipment to improve communications in the terminal during the check-in and boarding process. These should be finished by the end of 2010. Plus, a bill was passed to make $1.2 billion available to redevelop the Los Angeles waterfront, including rights for a second cruise terminal, should the port choose to engage in such a project.

San Diego is building a new cruise ship terminal, which Elicone says will be "the Port's first green building and will be built with sustainable materials." The port is installing shore power in both the new and existing terminals so cruise ships can plug in when they're docked. Both projects should be completed by the end of the year.

What else is on the West Coast wish list? Chase says that in addition to bringing back Royal Caribbean and NCL, he'd like to see MSC sail from the West Coast, as it's one of the few major players without a presence there. He'd also like to see more high-end lines add southern California to their round-the-world itineraries.

Which ships and itineraries would you like to see from California homeports? Share your thoughts here.

--by Erica Silverstein, Senior Editor