Cruise sales soared in 2014 as such new ships as Quantum of the Seas and Regal Princess fueled demand. New ship orders were inked. River, exotic, expedition and luxury cruising were hot tickets. Cruise line value-adds were prolific. The Costa Concordia saga off Giglio, Italy ended, some Black Sea cruises were cancelled and Ebola forced health screenings. Cruise lines salivated over China. Top executives changed at many lines, plus Norwegian Cruise Line Holdings acquired Oceania Cruises and Regent Seven Seas Cruises.
|Cruise sales across the industry were robust in 2014. Norwegian Breakaway is shown above. // Photo by Susan J. Young|
Cruise Sales Posted Dramatic Growth
Travel retailers reported robust cruise sales growth as the year came to a close. Cruise Planners said its sales for 2014 were up 26 percent on average, while both Ensemble and CruiseOne/Cruises Inc. reported another good sign -- cruise pricing is inching upward. In a December story, we outlined major cruise executives' "take" on the end-of-year results and their Outlook for 2015.
While seven-day cruises remain highly popular, longer itineraries and group cruises are increasing in demand and helping agencies build revenue, according to an end-of-year Cruise Holidays survey. In December 2014, Travel Leaders Group released survey results that showed agents think consumer vacation spending will increase in 2015.
New Ships Fueled Consumer Demand
The big ship news for 2014 was the debut of Royal Caribbean International's Quantum of the Seas, the most technologically advanced cruise ship ever to sail the high seas. Travel Agent and trade leaders were at the shipyard as Richard Fain showcased the many new features.
|Richard Fain explained the many razzle-dazzle features of Quantum of the Seas to media and travel industry executives touring the ship late last summer in a German shipyard. // Photo by Ana Figueroa|
Perhaps the most compelling new feature? The ship debuted new fast, high bandwidth Internet service at sea, something consumers have desired for years. As Vicki Freed, the line's senior vice president, sales, trade support and service, told us, Millennials want to have all their devices, they want to be connected, they want fast connections and they want it now. The ship also debuted a new robotic bar with robots mixing cocktails, and plenty of other razzle-dazzle high-tech features.
|Jan Swartz, Princess Cruises' president, speaks at the christening of Regal Princess, the newest "Love Boat." // Photo by Susan J. Young|
Regal Princess also debuted, a slightly enhanced version of its popular sister ship, Royal Princess. But it wasn't so much the ship itself that stirred up interest, it was the return to "The Love Boat" for the line's 50th anniversary year. All six members of the original Love Boat cast teamed up for the ship's christening, and also rode the line's float in the Tournament of Roses parade.
Other ships launching in 2014 included Costa Diadema, Norwegian Getaway and a slew of river vessels.
Catherine Deneuve christened Uniworld's new S.S. Catherine riverside in Lyon, while Viking River Cruises had another razzle-dazzle christening for multiple ships and an impressive trade dinner in the shadow of the ancient Pont du Gard in southern France. AmaWaterways, Avalon Waterways, Pandaw, Tauck, CroisiEurope and other lines also launched new vessels.
New oceangoing ships, including one for Seabourn, were also ordered during the year. For example, in December 2014, Carnival Corporation ordered two more vessels -- one each for its Carnival Cruise Lines and Holland America Line brands.
River Cruising Was the Hottest Ticket
River cruises across the globe showed amazing growth in 2014, with nearly every line building river vessels as fast as possible. European cruising grew with new itineraries on the Elbe in Germany and the Rhone/Saone rivers and Bordeaux region of France. Most prolific on the order front was Viking, which announced in April 2014 that it would launch 12 new vessels in 2015. A new river line, Emerald Waterways, a sister brand to Scenic Cruises, debuted on European rivers.
|Viking River Cruises launched many new Longships. // Photo by Susan J. Young|
Trends in river cruising? Family river cruising increased in popularity. More fitness-minded guests began to book a river cruise. Lines debuted many new themed cruises. Wine and culinary travel on river ships proved highly popular. River cruisers sailing on Viking were able to visit Downton Abbey as part of the line's PBS partnership, which included a television promotion that benefitted all river lines -- as it helped build consumer interest in river cruising.
Across the globe, new options were available in Southeast Asia on the Mekong and in Myanmar on the Irrawaddy. Perhaps the biggest itinerary news came from Uniworld, which announced it will sail in India for 2016.
Pandaw Cruises added many new cruises in the region, and, in November, Scenic Cruises announced plans for a new Mekong river vessel.
Demand Soared for Exotic, Expedition & Luxury Cruises
For "been there, done that" clients, cruise lines continued to add new exotic itineraries. Australia's exotic Kimberley region, new African itineraries, more in-depth exploration of Asia and new World Cruise options all enticed clients onboard.
In our end-of-year outlook story, Alex Sharpe, president and CEO, Signature Travel Network, pointed to what he called "the breathtaking success of Crystal Cruises and its Northwest Passage sailing, which sold out in less than two weeks, for an itinerary far into the future."
Sharpe also pointed to the success of the luxury Silversea Expeditions, which in 2014 added a third expedition ship, Silver Discoverer. “Travelers are hungry for new destinations, new experiences, new ports and new horizons," Sharpe noted.
Cruise Lines Opted for Value-adds & Bundling
Agents have lobbied cruise lines for years to provide value-added perks, rather than cutting the price when staterooms remain unsold. In 2014, it was clear that most lines got the message.
Libbie Rice, co-president, Ensemble, and Roger Block, president, Travel Leaders Franchise Group, both cited a 2014 emerging trend of more value-adds. That often included a menu of such choices as shore excursions, shipboard credits, free gratuities, reduced deposits and third/fourth cruisers sailing free.
|Value-added features are increasingly used to entice clients to book. // Photo by Susan J. Young|
Rice specifically referred to “Explore4” by Holland America Line; the “Pick Your Perk/123 Go/All-In Suite” offers by Celebrity Cruises; “Three for Free” by Princess Cruises; “Why Choose” by Regent Seven Seas; and an all-inclusive package add-in by Norwegian Cruise Line.
The Costa Concordia Story Came to an End
The sad saga of Costa Concordia, which ran aground near Giglio, Italy, in 2012, drew nearer to a close. In July 2014, sponsons filled with air were attached to the ship's sides and the ship was successfully towed to Genoa where it's now being scrapped.
|Costa Cruises Lines said farewell to Costa Concordia in 2014. // Photo by Susan J. Young|
For Giglio, two years of disruption had thankfully ended. Following the accident, safety officials, engineers, divers, cruise line personnel, contractors and gawkers all had traveled to the small island to work on or look at the ship, lying on its side just offshore.
In 2013, engineers "righted" the ship in an unprecedented parbuckling operation, designed to ready the vessel for towing. Thirty-two people died in the accident. Several of the ship's officers and crew are serving prison time. The Captain is still on trial for his role in the accident.
Separately, in another accident scenario, three workers on Oceania's Insignia were killed in a fire onboard in December, while the ship was docked at St. Lucia. No passengers were injured. The ship is expected back in service in March.
Black Sea & Russia Voyages Disrupted
As the conflict between Russia and Ukraine escalated and Malaysia Airlines Flight MH17 was shot down over Ukraine, some ocean lines adjusted voyages to eliminate Ukrainian port calls in the Black Sea. However, the conflict did not seem to affect Baltic itineraries to Russia in the same way, as ships continued to call at St. Petersburg.
On the river side, though, AmaWaterways announced late in the year that it would not operate on the Volga in the coming year, instead offering guests alternative voyages elsewhere.
Ebola Fears Forced New Health Screening
A nurse from a Houston hospital who had potential exposure to the deadly Ebola virus boarded a Carnival Cruise Lines ship for a vacation with her husband. It set off a string of events that ultimately resulted in a change in health screening procedures for the entire industry. The nurse was following the health protocol in place at the time of boarding.
But during this Carnival Magic cruise, the U.S. Centers for Disease Control strengthened that protocol with more strict requirements, and thus notified Carnival and the nurse that she was at risk. The passenger voluntarily isolated herself in her stateroom for the remainder of the cruise, but the cruise industry held its breath while the ship -- refused entry to Cozumel, Mexico -- returned to its home port of Galveston.
When samples taken from the nurse onboard were analyzed prior to the ship's arrival in port, officials and passengers were relieved to find out that the nurse did not have Ebola. That said, the cruise industry has since implemented a new health screening form which asks guests if they have had exposure to the virus or traveled to countries with Ebola outbreaks. Passengers fill out the form before boarding and will be denied boarding if they do not meet the requirements.
Cruise Lines Salivated Over China
In a surprising move, Royal Caribbean International announced in April 2014 that it would send its newest ship, Quantum of the Seas, to Shanghai, China in spring 2015 for year-round service -- instantly increasing competition in the massive Chinese sourcing market.
In 2015, China will represent 10 percent of RCL’s summer capacity, while Asia overall will be 15 percent of the company’s deployments, up from 12 percent this year, according to Robin Farley, a cruise industry analyst for UBS Investment Research.
Carnival Corporation, which already has a sizable operation in Asia with Costa Cruises and Princess Cruises, announced it was sending its chief operating officer, Alan Buckelew, to Shanghai to handle Carnival's growing portfolio of operations there. By this summer, the company will have four ships based in China.
In 2013, the Asia Cruise Association estimated the Asian market could grow from 1.3 million passengers in 2012 to 3.8 million in 2020, with a full 1.6 million of those people coming from China. In an October story, we asked "What's In It for Agents and Lines?"
Leadership Changed in 2014
|In a surprise move, Christine Duffy, formerly with CLIA, has become the new president of Carnival Cruise Lines.|
The biggest surprise on the executive front? In December 2014, travel agents learned that Christine Duffy, president and CEO, Cruise Lines International Association, was leaving CLIA and would become the new president of Carnival Cruise Lines. Gerry Cahill, Carnival's former president, retired in November. The CLIA post is still vacant at this time.
Among other 2014 executive moves, here's a small sampling:
- In April, Adam Goldstein was appointed president and COO of Royal Caribbean Cruises Ltd., the parent company of Royal Caribbean International, Azamara Club Cruises and Celebrity Cruises.
- Late in the year, Lisa Lutoff-Perlo was promoted to president and CEO of Celebrity Cruises, and Michael Bayley, that's line's former president, shifted to become Royal Caribbean International's president and CEO.
- In November, Drew Madsen was named president of Norwegian Cruise Line and Kunal Kamlani departed from Prestige Cruise Holdings.
- Richard Meadows became president of Cunard Line in North America, taking on that job in addition to his existing gig as Seabourn's president
Separately, two pieces of sad news...
- Travel industry legend Jimmy Murphy passed away late in the year. He was a co-founder of Brendan Worldwide Vacations and AmaWaterways.
- Stanley McDonald, the founder of Princess Cruises, also passed away in December.
Norwegian Became a Major Player
|Norwegian Cruise Line Holdings, parent of Norwegian Cruise Line (shown above), added Oceania Cruises and Regent Seven Seas to its portfolio of brands in late 2014. // Photo by Susan J. Young|
In September 2014, Norwegian Cruise Line Holdings, which essentially had one brand -- Norwegian Cruise Line -- announced it would acquire Prestige Cruises International, owner of Oceania Cruises and Regent Seven Seas Cruises. The $3.5 billion deal included cash, stock and debt assumption.
The acquisition was completed by year's end. Now Norwegian has a contemporary, upper premium and luxury brands in its portfolio.
It's become the world's third largest cruise company and well-positioned to compete with Carnival Corporation and Royal Caribbean Cruises Ltd., the Big Two of the cruise industry.
As 2014 drew to a close, agents report they're anticipating a good year in 2015. Stay tuned for a look at how Wave Season is shaping up in the coming weeks.