Posted By Cruise Market Watch / 15th April 2012
Sally with RCL's Grandeur of The Seas
Cruising has always been about more than just sailing – it’s also about visiting and exploring destinations. One of the best ways to do that in Old San Juan Puerto Rico is a horse and carriage tour with Las Calesas Del Viejo San Juan. Not only will you get to see the highlights of Old San Juan, you will learn about the culture and history from your skilled and knowledgeable driver. The sound of horse’s hooves over the cobblestone streets can’t help but transport you back to the early years of Spanish rule in the 16th, 17th and 18th centuries.
Experiences such as these explain the positive cruise industry economic impacts to local economies and small businesses that operate shore side excursions.
Puerto Rico is no exception. With a 2012 Port Pulse™ rank of 26th (out of over 830 embarkation and destination ports around the world) the Port of San Juan benefits from the spending of 150,000 crew and 920,000 annual passengers. That is a direct economic impact estimated at over $125 million.
Review seasonality of 2012 passenger and crew spending in San Juan, cruise line share and embarkation vs. destination statistics in the charts below by clicking the image to enlarge.
Cruise passenger and crew spending in ports of call from direct spending on a variety of goods and services including ground transportation, clothing, food and shore excursions. For embarkation/debarkation ports estimates also include lodging as part of a pre- and/or post-cruise stay, air and ground transportation and miscellaneous port and cruise line services.
Sources: Crew and passenger visitation rates and port spending estimates derived from Business Research & Economic Advisors, Florida-Caribbean Cruise Association and Cruise Lines International Association. Each ship's unique destination itinerary, sailing days and passenger capacity from Cruise Market Watch.
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.