Cruise lines “slash” prices for February

Cruise lines “slash” prices for February

By Lee Hayhurst

Cruise lines “slash” prices for FebruaryCruise lines are slashing prices in a bid to boost sales after what is understood to have been a disappointing January.

A series of agents and third parties including cruise.co.uk, Cruise 1st and Travelzoo have gone out today with e-alerts claiming prices have been “slashed”.

Operators had hoped to increase prices this year during the key early year wave booking period but Travel Weekly understands business has been slower than hoped.

While Travelzoo is advertising savings on a range of cruises worldwide, the more aggressive discounts and added-value deals are available on ex-UK Southampton sailings.

Cruise.co.uk sent an alert to its database today entitled “Southampton prices slashed”, indicating the lines had given up trying to drive higher prices.

Cruise 1st’s press release claims to have “slashed” Royal Caribbean prices sailing from the UK, with prices from £599 for seven nights in a balcony cabin, plus onboard spend.

The Travelzoo ‘newsflash’ is headlined: “Cruise Prices Slashed for Wave Season, Save up to 54%”.

Seamus Conlon, cruise.co.uk managing director, said: “The cruise lines have introduced new cheaper prices with restrictive conditions in order to boost sales.”

Carnival UK sales director Giles Hawke denied the move was a reaction to poor sales in January. “As we often do, we have a small amount of residual stock left on some early season cruises.

“For 2013 so far, we’re happy with our rate of sale and our yield. The prices we’re now putting into the market are not significantly different to what we had in the market last year.

“The new cheaper prices carry different terms and conditions so consumers can chose to have flexibility at the higher fare or pay in full with lower flexibility for the lower fare.”

Carnival’s P&O Cruises and Cunard brands introduced a new pricing structure this year in which early booking Vantage Fares were meant to offer the best value and late Getaway Fares, while possibly cheaper, offered less flexibility.

Most of the major lines have cut commission to travel agents in the last year, Carnival the most aggressively to just 5%, from up to 15%.

Today Royal Caribbean International and Celebrity Cruises, which are paying 10%, unveiled “double incentives for agents and enticing new offers for customers”.

Royal Caribbean’s ‘Going, Going, Gone’ campaign is offering 3,000 14-night cruises at £999 per person, and 1,000 six to eight night cruises at £599 per person, from Southampton.

A Royal Caribbean announcement said agents will receive a £20 Lifestyle voucher for every 2013 booking made in February on cruises sailing from Southampton.

In addition, for any cruise booking made before February 28, agents will be entered into a daily prize draw to win one of five £100 Love to Shop vouchers.

Celebrity Cruises’ ‘123 Go!’ campaign allows customers to choose from one of three offers – free drinks worth up to $1400 per stateroom, free coach transfer or car parking in Southampton or $300 to spend onboard.

The offer is valid on all 2013 Celebrity Eclipse sailings departing from Southampton, in all stateroom categories, and also ends on February 28.

Agents will also receive a £20 Lifestyle voucher for every 2013 booking they make on Celebrity Eclipse sailings departing from the UK and sold in February.

In addition the Great Apple Giveaway has been extended until the end of February. Agents can win weekly giveaways of iPhone 5s and iPad minis, plus a grand prize of a stylish MacBook Air.

Cruise lines carried 20 million passengers last year, CLIA says

Cruise lines carried 20 million passengers last year, CLIA says

By Tom Stieghorst
The cruise industry carried more than 20 million passengers last year, according to an estimate released at a CLIA briefing in New York.

The industry’s global 2012 passenger count was 20.3 million, with 17.2 million sailing from North America.

CLIA estimated the 2011 global passenger base at 16.3 million this time last year.

For 2013, its projections call for slightly less than 21 million passengers, including 17.6 million sailing from North America.

CLIA President Christine Duffy said that 3,000 new travel agent members have affiliated with CLIA with the recent combination of global cruise trade groups into one worldwide network. That is in addition to 14,000 agent and agency members in North America.

2013 CLIA logoThe number of cruise line members has grown from 26 to 55, she said.

CLIA unveiled a new logo to represent the global association it has become.

Duffy said 167 new ships have been built since 2000 for the industry. Another 20 are in progress, CLIA marketing committee head Jim Berra said, representing an $8 billion investment.

Asia cruise market prediction: 7M passengers a year by 2020

Asia cruise market prediction: 7M passengers a year by 2020

By Tom Stieghorst
HONG KONG — By the end of the decade, Asian passengers will account for one in every five cruisers, about double the ratio today, Carnival Asia head Pier Luigi Foschi predicted at a cruise forum here.

Foschi said the snowballing growth in Asia will deliver about 3.7 million passengers a year by 2017 and about 7 million by 2020.

Hong Kong Ocean TerminalBy comparison, the Asia Cruise Association said that about 1.7 million Asian passengers cruised in 2011, or about 10% of CLIA’s estimate of 16.4 million passengers globally for that year.

Foschi’s forecast quantifies Carnival’s view of the oft-discussed “potential” in cruising from China and other Asian countries. “The bulk of the real growth will be from China,” Foschi said.

Carnival Corp. Chairman Micky Arison said in December that new Asia deployments for one or more Carnival brands will be announced by April.

Carnival last week announced plans to open a sales office for Princess Cruises in Hong Kong, where officials are getting ready to open a large cruise terminal in June.

Princess also announced it will deploy a second ship in Japan in 2014 to offer summer cruises. The 2,670-passenger Diamond Princess and the 2,022-passenger Sun Princess will offer 42 cruises to 20 Asian ports next year.

The Seatrade Hong Kong Cruise Forum, held here, and where Foschi delivered his remarks, gathered several hundred Asian port directors, cruise line deployment executives, and shore excursion managers. The four-day conference explored cruise prospects for Hong Kong in light of China’s growth and the opening of a new cruise terminal in Hong Kong later this year.

Zinan Liu, chairman of the Asia Cruise Association and a regional vice president for Royal Caribbean, said Royal Caribbean International currently has the most tonnage dedicated to Asia.

In a chart presented at the Seatrade Hong Kong Cruise Forum, Liu put Royal at 276,000 gross tons, followed by Star Cruises at 259,749 tons and Costa Cruises at 160,785 tons.

Having determined to put bigger ships in Asia, the question for the cruise lines is how to precisely tailor a cruise that satisfies Asian tastes, said John Tercek, vice president for commercial development at Royal Caribbean.

“We are in a bit of an experimental stage,” Tercek said.”The potential is fantastic, but it’s a question of what do the local clients want to do, and can we accommodate it?”

One clear preference in Asia is for shorter cruises of five days or less. That makes cruises offered to Asians distinct from cruises offered in Asia to North Americans and Europeans, which tend to be 12 to 14 days or longer.

Other differences are more subtle. For example, Tercek said beach-going is a core interest for North American cruisers. But on cruises from China, Royal is skipping beautiful beaches in Vietnam because Chinese guests tend not to enjoy harsh sunlight.

Other cruise lines are also making trial-and-error discoveries. Princess Cruises expected its cruises in Japan later this year to draw mainly Japanese guests. But enough Americans and Europeans have booked the cruises that Princess has added English-speaking tour guides for its shore excursions, said Bruce Krumrine, a Princess vice president.

Pier Luigi FoschiFoschi said challenges to growth in Asia include misperceptions about what cruises are, lack of distribution, late booking, competition from cheap land vacations and a strong seasonality that causes swings in net revenue yields.

Regional disputes are also a threat. Last year, China granted a permit to extend cruises between Hong Kong and Taiwan to Japan, making them much more attractive.

But the current tension over an island in the East China Sea that China and Japan both claim is making it hard for Royal Caribbean to take advantage of the permit, Liu said.

“These are ongoing business problems that unfortunately will come to us again and again,” he said.

The lack of destination ports with the capability to handle big ships may be the biggest challenge. Liu said there are some 80 potential cruise ports in Asia.

But most lack the capacity to dock large cruise ships. Royal’s decision to add the 3,100-passenger Voyager of the Seas to Asia should begin to change that, Tercek said.

“Wherever we take that ship, others follow because we cause the infrastructure to be built,” he said.

If not, cruise lines could become partners in port developments as they have occasionally in the Caribbean, Tercek said. But to make it work, he said a port has to have the potential to attract several hundred thousand guests and be unable to proceed without outside help.

“It really isn’t our first option ever,” he said.

For itinerary planners, Hong Kong is a challenge

HONG KONG — Cruise deployments in Asia tend to be seasonal. In the summer months, ships sail from northern China ports such as Shanghai and Tianjin to a cluster of destinations in Northeast Asia, mainly South Korea and Japan.

In the winter, cruises operate in Southeast Asia, especially from Singapore, which has just opened a new cruise terminal. From there, itineraries to Thailand, Vietnam, Indonesia, Malaysia and Myanmar are possible, along with cruises south to Australia and New Zealand.

A port such as Hong Kong, which plans to open a large new cruise terminal later this year, falls in between.

Participants at the Seatrade Hong Kong Cruise Forum said that until now, Hong Kong has been primarily a place for transitional cruises as ships migrate from north to south in the fall and back the opposite way in the spring.

Hong Kong is within easy reach of Taiwan and Vietnam, but other destinations are hard to serve on the short, four- and five-day itineraries that tend to be most appealing to Chinese and Asian tourists.

“In terms of where can we take the guests and where can we visit, it’s fairly limited,” said John Tercek, vice president of commercial development for Royal Caribbean International.

Another issue for cruises is the distant spacing of ports in Asia at a time when cruise lines want to cruise slowly to save fuel. “We’re trying to bring down our average speed,” said Mike Pawlus, director of itinerary planning at Silversea Cruises.

That makes it harder to design itineraries that meet the Asian need for short vacations.

“It’s a big ocean, there are large seas here and great distances between ports,” Pawlus said. — T.S.