2003 yearend review: unusual circumstances affected the Cruise Industry in unusual ways

Cruise Travel, Jan-Feb, 2004 by Theodore W. Scull

Topsy-turvy may best describe the world of cruising in 2003. The calendar year began with cruise prices depressed from a sluggish economy and a hesitancy on the part of some travelers to take to the air, or at least fly very far from home. The war with Iraq brought bookings almost to a standstill, but the heavy fighting was short-lived, and cruising interest started on the upswing only to be dealt a double whammy from a Norwalk-like virus that afflicted a number of ships and the SARS outbreak in the Far East with a ripple effect in Canada and the U.S.

As the summer progressed, the pent-up demand sent bookings way up, and cruise rates began to slowly rise. Exotic-destination cruising still suffered, as did much of Europe (especially the Mediterranean), but cruise ships sailing from North American ports did a land-office business with more departures from more domestic ports than ever before.

By the end of the year, the Cruise Lines International Association, the industry's trade and marketing group, predicted that 8.3 million will have taken a cruise on its affiliated lines, well up from 7.4 million in 2002. While the vast majority of cruisers now use the internet for research, more than 90 percent of North American passengers sailing with CLIA's 25-member cruise lines book through a travel agent, and agencies derive half their leisure travel income from cruise bookings. However, even with increased numbers and booked capacity running at over 98 percent, the two-year period of lower cruise line profits brought new ship orders almost to a halt, while vessels already ordered and under construction continued at a high pace: 40 major new ships entered the cruise market in the 1980s, then the figure doubled to almost 80 in the 1990s. A dozen ships were delivered in 2003, and a similar number are on the way for 2004; but for 2005, the scheduled deliveries plummet to less than half a dozen. Some shipyards had nothing on the order books beyond 2004 or 2005, when to everyone's surprise, both Norwegian Cruise Line and Royal Caribbean International placed firm orders within a week of each other.

In late September, Royal Caribbean went to Kvaerner Masa-Yards in Helsinki, Finland, for a pair of 160,000-gross-registerton ships designated "Ultra Voyager," approximately 15 percent larger than the present Voyager Class. Passenger capacity will number 3,600 and crew 1,400. The first of the 22-knot ships is scheduled for a May 2006 delivery with an option for a second unit for 2007. On the downside, RCI dropped the option with Meyer Werft for two additional 90,000-grt Radiance Class ships.

In an upstaging move, Ultra Voyager will surpass Cunard Line's Queen Mary 2, due for delivery in late December 2003, by approximately 10,000 gross tons. However, the Ultra Voyager's length will be 1,112 feet compared to 1,132 for QM2, the discrepancy being the stubby-hull/calm-water cruising design for the former versus the latter's sleek ocean-liner shaping designed to take potentially heavy seas.

But happily for Meyer Werft, all was not gloom and doom. Malaysia's Star Cruises signed a letter of intent to build two 93,000-grt cruise vessels at Papenburg, Germany, for North American subsidiary Norwegian Cruise Line, slightly larger near-sisters to the Norwegian Dawn and Norwegian Star. The contract calls for the first to be built in 22 months from the date of signing for delivery in 2005 and the second coming in 2006. With these two orders, Star has upped NCL's capacity by nearly 13,500 berths since 2000.

Arguably the biggest cruise news in 2003 was the final consummation of a merger between Carnival Corporation and P&O-Princesss Cruises into a giant new company. Both the London and New York stock exchanges carry listings and engage in trading, and for the foreseeable future, the familiar individual brands will continue.

Under the "World's Leading Cruise Lines" umbrella, Carnival Corporation contributes Carnival Cruise Lines, Holland America Line, Costa Cruises, Cunard Line, Seabourn Cruise Line, and Windstar Cruises, while P&O-Princess contributes P&O Cruises, Princess Cruises, P&O Cruises Australia, Swan Hellenic, Ocean Village, AIDA Cruises, and A'ROSA Cruises. Then in the late slammer, it was announced that A'ROSA Cruises would be disbanded and its one deep-sea ship A'ROSA BLU would in summer 2004 become part of the AIDA fleet as AIDAblu Three new A'ROSA riverboats would also transfer.

In new ship news the 110,000-grt/2,974passenger Carnival Glory began year-round seven-day Caribbean service from Port Canaveral in July, becoming the largest ship based there. The 19th ship in Carnival's fleet is an enlarged, Destiny Class unit and sister to Carnival Conquest, which began sailing from New Orleans in December 2002.

In a transfer of older Carnival tonnage, the 47,262-grt/1986-built Jubilee will be refitted for P&O Cruises Australia in October 2004. To be renamed Pacific Sun, she joins 1984-built Pacific Sky for yearround South Pacific cruising from Sydney and Brisbane. The latter port, also Australia's fastest growing city, will build a new Brisbane River cruise terminal to upgrade the present basic pier facilities.