Cruises squeezed in Miami vice

Confirmation that cruises have never been better value comes with the admission from Carnival’s president, Gerry Cahill, that his line – and others – cut from 10 to 20 per cent off their fares last year in order to keep bookings coming in.
Fares are starting to creep back up, as consumer confidence increases, but cruise bosses meeting at Cruise Shipping Miami this week still think it will take a while for prices to recover to their levels before the start of the recession.
“Consumers are starting to open their wallets again,” said Dan Hanrahan, president and CEO of Celebrity Cruises, who believes that even when demand was higher, in 2006 and 2007, competition was keeping prices artificially low.
“There are solid signs of recovery, albeit one that will play out over the next couple of years, said Norwegian Cruise Line CEO Kevin Sheehan. He has to be confident – his company launches its biggest-ever ship, the 153,000-ton Norwegian Epic, in June.
Royal Caribbean’s Adam Goldstein was cautious. “There are still clouds that hang over this country and others. We could be in for a bumpy ride.” But MSC’s Rick Sasso was the most bullish, predicting that pricing could perhaps recover within six months.
While they struggle to carve out market share in America, the cruise bosses are peering intently into their crystal balls in the search for new customers.
“All the major regions of the world are catching on to cruising,” said Goldstein. Demand is growing at a fast pace in Europe, Asia, the Middle East and Latin America, particularly Brazil.
‘The continued upside in Europe is great. There’s still a lot of room to grow. Ultimately, Asia may be the largest opportunity in cruising, maybe in all of travel.”
The bravest person at the conference – or perhaps the most foolhardy – was Sean Parnell, governor of the state of Alaska. It’s one of the most popular destinations in the world for cruise passengers, but punitive taxes and stringent environmental regulations have forced many ships out of the region, and capacity is down by 17 per cent this year.
He had to listen to Stein Kruse, president of Holland America Line going on the offensive.
“Alaska’s environmental regulations are more burdensome and costly than anywhere else in the world,”, said Kruse. Since 2006, he said, the state has collected $200m in taxes “that they don’t know what to spend on.”
The industry supports environmental efforts and is willing to pay a reasonable price to comply but is concerned with “overzealous regulations when the technology does not exist to meet those regulations,” Kruse said, adding – as if it were necessary – “we can redeploy if we’re not able to comply with reasonable operating requirements.”