UBS Estimates Historically Low Cruise Capacity Increases

North American fleet capacity increases are expected to grow 5 percent annually through 2009, notably below historical averages of 7 percent to 8 percent growth, UBS said in its cruise capacity monitor on Thursday. Even with the addition of Royal Caribbean's 5,400 berth Genesis-class ship coming on line in 2009 and the expected delivery of its similar-sized sister ship in 2010, capacity growth will remain below historical levels, the investment bank said. Other anticipated capacity changes include Carnival Cruise Lines picking up the options on two ships to be delivered in 2010, which will follow up on the delivery of four ships totaling more than 11,700 rooms for delivery in 2008 and 2009. UBS also expects CCL to sign a letter of intent in October to build two 450-berth ships for its Seabourn brand for delivery in spring 2009 and spring 2010, which would increase the line's capacity by roughly 140 percent. Norwegian Cruise Line also has confirmed contracts to build two new ships, with an option for a third. The vessels should be completed by 2009 and 2010, respectively, and total 12,600 berths. The optional third ship would be delivered by Q1 2011. UBS also hints that Celebrity Cruises may swap another ship with Pullmantur, as it had previously done when it swapped its bigger Zenith ship with Pullmantur's smaller Blue Dream. A similar exchange would further reduce its parent company's capacity, RCL, by roughly 1.2 percent.

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