|Photo by Susan J. Young|
The start of the annual Wave Season appears headed in the right direction, according to Robin Farley, a financial analyst for UBS Global Research (www.ubs.com).
Her firm’s “Cruise Price Tracker” shows that cruise pricing for 8,000-plus voyages of six North American cruise lines and two major European lines, is showing a slight uptick.
Yes, it’s very early in Wave Season; the annual booking promotional period will continue for several months. But so far, the news is positive for cruise lines and travel agents who yearn for more realistic fares that reflects the inclusive value of a cruise vacation.
For many lines, the pricing needle hasn’t moved far from where it hovered decades ago, yet most cruise vacations are more inclusive, innovative and very different than back in the “Love Boat” era.
Farley says pricing is better in first week of his year's Wave Season, based on the average price of all sailings for those eight lines. Price increases are being driven by the lines’ increases in fourth quarter 2014 pricing. In the past few weeks of December, Farley said pricing was down or flat, but most lines are now seeing an increase.
When citing specific brands, Farley said Norwegian Cruise Line stands out with the biggest sequential improvement, cumulatively over the past four weeks. Royal Caribbean International, while being down on the price side on a four-week basis, is now up in the first week of Wave, “recording the highest sequential improvement among the nine major brands we track,” she said.
Princess Cruises and Celebrity Cruises were up slightly. So was Carnival Cruise Lines, which Farley said “improved from a flattish-to-down trend in the three-week period prior to start of Wave.” The analyst said pricing on Costa Cruises and Holland America Line remains “flattish.”
Where are the pricing increases geographically? The Caribbean pricing is up, Alaska is softer, although it's showing improvement, according to Farley. Bahamas pricing is also up, a slight improvement over the flat week prior to Wave, but overall, “Bahamas pricing has been strong…since mid-November 2013.”
Both eastern and western Mediterranean itineraries also are seeing price increase, with more improvement on the western routes.
Demand seems to be good. And just because ticket prices are up, it doesn’t mean that cruise lines don’t offer other incentives to stimulate demand such as "value-adds" including onboard credits.