Posts Tagged ‘cruise ship’
Posted By Cruise Market Watch / 21st August 2013
English: The Celebrity Millennium cruiseship docked in Nassau, Bahamas (Photo credit: Wikipedia)
After the recent mechanical issues with the Celebrity Millennium, Royal Caribbean Cruises Ltd., which owns Celebrity Cruises, announced Tuesday the cancellation of the remainder of the ship’s seven-night cruise to Alaska and four additional cruises, when a faulty propulsion caused the return to port in Ketchikan on August 18. At the time, about 2,200 guests and nearly 960 crew members were on-board. The company will offer full refunds to all passengers who have been stuck in Ketchikan and also to guests booked on the other canceled sailings, as well as a certificate for a future cruise.
Lost revenue will show in many forms, including costly repairs of the vessel and lost on-board revenue. Based on actual ticket pricing, Cruise Market Watch estimates lost ticket revenue of $13,851,093:
| $ 3,058,593
| $ 2,908,601
| $ 2,555,152
| $ 2,512,067
| $ 2,816,680
|| $ 13,851,093
Only time will tell if the unknown variable of customer sentiment will correlate to an additional effect on incremental sales, but our guess is that even naysayers would have a difficult time saying no to a $31.76 dollar/day 16 day cruise to Southern Europe on board of the Carnival Sunshine, which according to our database is the cheapest inside cabin on a per passenger per day basis that you could book. Happy sailing!
Posted By Cruise Market Watch / 16th February 2013
Unloading relief supplies on Carnival Splendor 2010-11-09 2 (Photo credit: Wikipedia)
The “Pop Tart Cruise” on Carnival Splendor November 2010 was greeted with curiosity and had little impact to bookings or ticket prices. The Costa Concordia January 2012 incident was greeted with shock. Bookings and prices did drop and while they have since recovered; public consciousness of the event still hasn't gone away (and either has Captain Schettino). I get the sense the “Cruise from Hell” on the Carnival Triumph February 2013 is being greeted with “enough is enough.”
Sure, with over 10,000 annual cruise sailings every year there are little things that can happen to cruise ships (pier bumps, rouge waves etc.,). And with a seven percent compounded annual growth rate, the likelihood of such events simply continues to be multiplied. Nevertheless, when a company dusts off the pre-Concordia advertising campaign themed “Land vs. Sea” to run in the subsequent year’s wave season, one is tempted to question good judgment.
I know. Memories are short. The media will move on to new stories. Carnival obviously overcame the fact its first cruise ship, the Mardi Gras, ran aground on a sandbar during its inaugural voyage in 1972. And don’t expect any instant drop in ticket prices. Prices for close-in sailings (those sold one to three months in advance of departure) took five months after Concordia to bottom in June 2012 .
The direct impact to the bottom line can be quantified by simply accounting for the 14 canceled Triumph sailings scheduled between Feb 11th and April 13th 2013, plus the ill-fated Feb 7th voyage. The amount totals $20.8 million in revenue according to Cruise Pulse. Based on the Splendor being off line 101 days, we believe Triumph guidance of 71 days is overly aggressive and the Triumph will likely cancel 7 more cruises up to the May 5th sailing, adding $9.8 million to lost ticket revenue.
But unfortunately the story may not end there. On the margin, where cash from ticket revenues meet up with corporate expenses this event will continue to be felt. Not exactly what an industry wants at a time when they are already being squeezed by a slowing European economy and the specter of inflation to costs for fuel and victualing.
When prospective cruisers hear Triumph passengers saying: “The credit, refund and $500 aren't really important. It’s not about the money. We will pay Carnival anything just to let us off the ship.” You have to wonder, will this time be different?
Repeat customers and die-hard cruisers will just get more bargains. And when prices get low enough, it is amazing how memories fade. But no spin can turn this publicity into a good thing for the industry. In order to attract the best talent to work aboard ships, continue to penetrate the large “never before cruised” market and stay the course with investors attracted to exponential passenger growth these events can’t continue. With 10,000 more "at bats" over the next year, getting wood on the ball 99.99% of the time so 20.9 million cruisers all leave happy and share their positive experiences is critical. In the interim, Cruise Market Watch will continue monitoring the ticket revenue and pricing trends.
Posted By Cruise Market Watch / 26th November 2012
Now in its fifth consecutive year, we are proud to release our 2013 cruise market statistics. In that short span of time the industry has robustly managed both a “great recession” and a once in a century ship incident.
MS Ryndam in Cozumel. (Photo credit: Wikipedia)
The Costa Concordia and European sovereign debt crisis impacted all cruise line revenues by about -5.1% from our original 2012 estimate (made two months prior to Concorida in November 2011). The actual revenue versus forecast difference was largest for Carnival Corporation (-9.2%) compared to -2.5% for Royal Caribbean Cruises Ltd. Passengers carried however continued to climb. Compared to our original 2012 forecast of 5.6% growth, actual results were very accurate. Carnival was down just -0.9% while Royal Caribbean was up 0.3% versus original estimates. All-in-all, 2013 looks to rebound strongly from the year prior on all accounts.
Among the 2013 highlights:
- - The worldwide cruise market is estimated at $36.2 billion, up 4.8% from 2012.
- - Cruise passengers carried worldwide in 2013 is forecast at 20.9 million, a 3.3% increase over 2012.
- - The top two cruise companies Carnival Corporation (NYSE: CCL) and Royal Caribbean Cruises Ltd. Co (NYSE: RCL) account for 71.7% of worldwide share of revenue
- - Direct spending by passengers and crew at all cruise ports in the world is estimated at $17.5 billion.
- - The top two ports are Miami, FL for embarkations and Nassau Bahamas as destination.
- - Total worldwide cruise capacity at the end of 2013 will be 438,595 passengers (a 3.0% increase over 2012) and 283 ships.
- - The average per passenger per day is projected to be $200.85, with $152.39 ticket price and $48.47 on board spending (average cruise duration 8.5 days, median duration 7.0 days).
A total of six new ships will be added in 2013 with a gain in passenger capacity of 14,074 (including the 3,600 passenger Royal Princess, the 4,010 passenger Norwegian Breakaway, 2,192-guest AIDAstella and 3,502 berth MSC Preziosa). Looking out further, 13 more new cruise ships will add 39,297 lower births or 8.9% to passenger capacity by the end of 2015 – generating $3.2 billion more in annual revenue for the cruise industry.
By 2017, 23.7 million cruise passengers are expected to be carried worldwide of which 59.1% will originate from North America and 27.4% Europe.
Posted By Cruise Market Watch / 1st November 2012
The infographic below guides you on how far in advance you should book, and the season to set sail for the best deal on a Caribbean cruise. This provides a framework for planning, from which you can then narrow down your specific destinations, cruise duration, cabin type and ship segment. Based on actual pricing* from 26 cruise lines and 144 cruise ships representing over 7,500 sailings in the Caribbean and Bahamas between September 1, 2010 to November 30, 2013, it just goes to show a little advance planning can save a lot of money per person per day on your cruise itinerary.
Interestingly, unlike its European infograph counterpart, Caribbean cruises get more expensive each month closer to the sail on date - so no penalty for booking well in advance!
* Cruise Market Watch total weighted average price (per per person per day) across all cabin categories.
Posted By Cruise Market Watch / 23rd October 2012
Cruise prices vary not only based on destination, number of nights booked, cabin type and ship segment but are also dependent on the season you set sail and how far in advance you buy. The same cruise itinerary can cost you a lot less per person per day if you book your ticket for the right season and the right number of months in advance. This infographic* can help you figure out the best time of year to go on a European cruise by highlighting prices by season and how far in advance you should book to get the best deal. The "rule of thumb for a European cruise" graphic requires little additional editorial comment. The only question that remains is what you will do with the money you save?
* Cruise Market Watch total weighted average price (per day per person) across all cabin categories from 30 cruise lines and 163 ships representing over 8,500 sailings in northern and southern Europe between September 1, 2010 to November 30, 2013.
Posted By Cruise Market Watch / 24th September 2012
People might be tempted to stereotype statisticians and other data crunchers as being heavily math leaning, if not somewhat lacking of the artistic gene. Not always so. The telling of an easy-to-comprehend story from a complex data set is really a skillful art. It is the same thing with finding creative ways to use the sometimes massive quantities of information in a database. Out of the box thinking can provide new value to users in ways they never imagined.
Take the folks over at CruiseWise.com. They dared to color outside the lines and developed a neat little port crowd calculator widget.
That could be a point of differentiation in the commoditized world of online cruise booking. As one of history’s greatest artists/designers Coco Channel said “In order to be irreplaceable one must always be different.”
Posted By Cruise Market Watch / 18th September 2012
Segmentation is happening all around us every day; SUV or economy? Soda or energy drink? VP or Junior Analyst? Cruise ships are no different – they each have distinct characteristics which we mentally place into groups (large and small, luxury and well, yes cheap). But what happens if we let the numbers speak for themselves? Cruise Market Watch developed a statistical model based on similarities within three dimensions:
~ average duration of cruise
~ average price per person per day (weighted across all cabin categories)
~ ship passenger capacity
From 221 different cruise ships accounting for over 9,000 sailings in the next 12 months, our model produced 10 distinctive cruise ship segments.
Each segment describes, based on the data provided, the “class” to which its members belong (naming the segments is, however, more art than science). Segment members are mathematically most similar to each other along the three dimensions, and most dissimilar to members of the other groups.
Interact with the graph below by clicking segment selector and discover each segment’s averages and ship members. And yes, Oasis and Allure really are in a class all by themselves. The math is un-biased, so don’t hate.
Posted By Cruise Market Watch / 22nd January 2012
Thus far pricing* for sailings on Costa (all Costa ships, all sailing departure dates) has not changed since the Concordia accident on January 13, 2012. Click on graph below for advertised prices from January 7 to January 21, 2012. Note little or no change to the booking prices. With prices for Costa holding up, wave season for RCL and CCL are likely holding up as well (refer to Cruise Pulse for details).
This finding is backed up by responses from several U.S. travel agents in regard to booking demand. Surprisingly, agents have indicated minimal to no demand impact. Nevertheless, on 12/30/2012 Carnival guided loss a booking slow down in the mid teens.
Interestingly, travel agents are currently Carnival’s best marketing resource. While the “Land vs. Sea” campaign is off the air (given its theme the campaign does not “play well” with current events) thousands of travel agents are out in the community engaged in conversations with prospective cruisers on a daily basis. It is these human one-on-one interactions that assure vacationers this tragic event is a “one off“ and in fact, given the renewed focus on safety and procedures, now is the safest time to cruise ever.
* Average price per day per person, inside cabin.
Posted By Cruise Market Watch / 14th January 2012
I’ve always been fond of the quotation “the law of flotation wasn’t discovered contemplating the sinking of things.” This has certainly held true for the cruise industry – growing the annual number of passengers carried nearly 5 times over the past 20 years. But with over 9,000 sailings worldwide in 2012 the odds of something going wrong somewhere do increase.
Traditionally I have considered the media coverage of cruises ships to be somewhat lopsided. I imagine there are plenty of things going on over the course of a year throughout hotel rooms in Las Vegas for example – but we tend not to hear these stories. By contrast, we do readily hear about the occasional sick cruise ship passenger, bad smell or overboard suicide.
My heart goes out to the passengers and families on Concordia’s sailing. This is a terrible tragedy by any measure. Without diminishing these human experiences, the recent events of the Costa Concordia will at the very least have an impact to Carnival’s near term bottom line, something Cruise Market Watch can measure.
For the Costa Concordia, remaining sailings in Carnival’s First Quarter (Q1) 2012 would have brought in an estimated total of $15.8 million in ticket revenue. For Q2 the impact will be in the order of $47.4 million in ticket revenue, Q3 $63 million and Q4 $45.9 million. Concordia was booking considerably higher prices during the summer (June, July and August). In a “back of the napkin” estimate that assumes the lost ticket revenue falls straight out of the bottom line this would equate to about .02 cents in Q1 earnings per share and .05 cents in Q2. The loss to earnings from the Carnival Splendor incident was .07 cents per share in a single quarter. Things we can’t measure include – what will be costs of raising and repairing the Concordia and when will she sail again? Will those who have already booked future sailings on Concordia transfer their vacations to other ships? What will be the legal actions and operational changes? We will have to wait to hear guidance from Carnival. Update: 12/30/2012 Carnival guided loss be in the range of $155-$175 million after a booking slow down in the mid teens. This news came after initially guiding $85 to $95 million lower (or .11 cents to .12 cents per share) on 12/16/2012.
Fortunately, ship builder Fincantieri has ship yards located right in Italy. Any near term impact to ticket pricing across Costa and other cruise brands will likely correlate with the duration of time in which the story continues to garner news headlines and cruise brands keep their wave season ad campaigns off the television. Pricing impacts will continue to be closely watched.
Posted By Cruise Market Watch / 29th November 2011
Among the 2012 highlights:
- ~ The worldwide cruise market is estimated at $34.1 billion
- ~ Cruise passengers carried worldwide in 2012 is estimated at 20.3 million, a 5.6% increase over 2011
- ~ The top two cruise companies Carnival Corporation (NYSE: CCL) and Royal Caribbean Cruises Ltd. Co (NYSE: RCL) account for 73% of worldwide share of revenue
- ~ The 2012 Port PulseTM rankings place Miami Florida as the #1 cruise embarkation port in the world and Nassau Bahamas the #1 port of call
- ~ Direct spending by passengers and crew at all cruise ports in the world is estimated at $15.5 billion
Image via Wikipedia
While cruise lines have grown annual passengers traveled at a compound annual growth rate of 7.4% since 1990 - all the cruise ships in the entire world filled at capacity all year long still only amount to less than ½ of the total number of annual visitors to Las Vegas. Cruise passengers carried worldwide in 2012 is estimated at 20.3 million, an increase of 5.6% over 2011.
On the heals of the several new ships to be added to the market in 2012 (including the 3,690 passenger Carnival Breeze, the 3,013 passenger MSC Divina, 3,012-guest Costa Fascinosca and 2,500 berth Disney Fantasy) eight more new cruise ships will launch by 2015. These ships will generate another $2.3 billion in annual revenue for the cruise industry. By 2015, 22.3 million cruise passengers are expected to be carried worldwide.
This is not only good for the cruise industry (of which two cruise companies dominate - Carnival Corporation (NYSE: CCL) and Royal Caribbean Cruises Ltd. Co (NYSE: RCL) with a combined 73% of worldwide market share) but also for the local economies of ports visited by cruise passengers. Direct spending by passengers and crew at all cruise ports around the world is estimated at $15.5 billion. The 2012 Port PulseTM rankings place Miami, Florida as the #1 embarkation port and Nassau Bahamas the #1 port of call. North America and Europe serve as the source markets for 85.9% of worldwide passengers, but other regions of the world such as Asia are growing significantly.
The new ships continue to bring attention to cruising, creating interest, additional pricing power, economies of scale and bookings of first time cruisers. Average cruise revenue per passenger per day for 2012 is projected to be $240.13.