People Want Cruise Travel Vacations, No Matter What!

Leading cruise company executives say that Americans go on cruise travel vacations even when there is a slump in the US economy. Americans just want to cruise, if statistics and trends released by the cruise industry are anything to go by. For several reason the cruise industry has projected a positive outlook for cruises this year, regardless of the diminishing strength of the dollar, the high cost of fuel and the embattled housing market. The CEOs of stock exchange listed cruise companies all agree that while the cruise vacation travel industry is not entirely immune to recessionary pressure caused by a weakening economy, there are many factors that favor the cruise industry above other forms of vacation. The all-inclusive nature of vacations makes the vacation budget controllable and places an enforced ceiling on discretionary spending, according to Dan Hanrahan, the marketing committee chairman for Cruise Lines International Association. Hanrahan cites 105 percent occupancy for ships belonging to association members’ cruise lines, which, he says is proof of the resiliency of the industry. He added that surveys among the various member lines suggested that bookings for cruise travel vacations would outstrip the already buoyant 2007 figures. Hanrahan put it in a nutshell, saying: “There's this belief amongst people that they deserve their vacations.” Hanrahan should know: he is also said Hanrahan, who also is president and CEO of Celebrity Cruises and Azamara Cruises, divisions of NYSE listed Royal Caribbean Cruises Ltd. “The fact that cruising provides such value is what's helped the cruise industry weather this storm so far.” It says a lot that another NYSE listed cruise travel vacation firm, Carnival Corp., along with Royal Caribbean, reported buoyant business despite the hurricane season in the Caribbean, some negative publicity about cruise safety, a lackluster housing market and rocketing fuel prices. These conditions have led to some interesting industry developments, such as the increased popularity of European cruises, larger cruise liners and investment of private equity firms in cruise operators such as Norwegian Cruise Line. Hanrahan, speaking as an Association spokesperson, said that 12.6 million passengers took cruises in 2007 of which about 75 percent, or 10.3 million of those coming from North America. He added that the industry expected an increase in worldwide cruise passengers this year to 12.8 million people. He said the various cruise travel vacation lines planned to add 8 new ships in 2008 and more than 35 new vessels in four years. In another report, Gerald Cahill, president and CEO of Carnival Cruise Lines, said the industry was healthy enough to withstand recessionary pressure, especially when compared to land-based vacations, saying it was 20% to 50% cheaper to go on a cruise than to go to a theme park, for instance. He was bullish on the outlook for the cruise travel vacation industry, predicting that cruise pricing would be resilient. Stein Kruse, president and CEO for Carnival's Holland America Line, said lines offering cruise travel vacations lines were working on lowering fuel costs by taking steps such as finding new hull paint that reduce a ship's drag in the water, changing itineraries and making sure the vessels used electricity available in port rather than previous fuel.