Some airlines and hotels are raising alarms about a slowdown in travel demand, but you won’t see many cruise lines complaining.
The recent boom in cruise bookings is showing no sign of abating, despite cruise lines having increased prices. A record wave season for Carnival Corp, RCI and Holland America signalled it’s full steam ahead for the cruise industry.
“This has been a fantastic start to the year,” said Josh Weinstein, CEO of Carnival Corporation. “We delivered another strong quarter that outperformed guidance on every measure, while concluding a monumental wave season that achieved all-time high booking volumes at considerably higher prices.”
Bloomberg reports that prices for 2025 bookings on Norwegian cruises are “significantly” higher than they were at this point last year for the 2024 season.
It also reports that demand for Royal Caribbean Cruises Ltd. is so strong, they have been able to boost prices, and that onboard spending continues to increase for both Royal Caribbean and Norwegian.
Simply Wall Street reports that NCL earnings are expected to grow 35.2% per year.
According to Cruise Hive, cruise ships are back to full occupancy, and 31.5 million pax are expected to set sail this year. That's up 6% from the previous highs of 2019.
“We get to see the cash register ring pretty much every second somewhere in the world on our ships. And I know there might be a group seeking to hear that there's some type of break in the pattern, but there just isn't,” Royal Caribbean CEO Jason Liberty said on the company’s earnings call.
Guests are “planning further out," he said. "Their willingness to pay more for these incredible vacation experiences continues to increase. So our pricing continues to increase into 2025 and into 2026.”
Liberty said that’s true for both shorter haul, cheaper cruises and more luxury options.
“Cruise remains an attractive value proposition and cruise purchase intent is high and continues to strengthen. Consumer financials remain healthy across demographics.”
One top industry source reports that looking at cruise line success depends on whether you measure bookings or revenue.
"We hear many agencies are down YOY in booking pax, but they are still up in revenue because average tickets are up," the source said.
Carnival Corportation recently announced that reservation numbers, revenue and total customer deposits during the wave season reached an all-time high, even with significantly higher prices year-over-year, Travel Age West reports.
Viking Holdings Ltd. this week said it generated roughly 7% more in net revenue from each pax in the second quarter of this year, compared to 2023. SeaTrade Cruise News says that, as of 11AUG, advance bookings on Viking for 2024 were 20% higher than for the 2024 season at the same point in time.
“Our latest advance bookings metrics give us confidence that our core consumer demographic continues to show resiliency, prioritizing travel and actively seeking enriching, memorable experiences,” said Viking Chairman/CEO Torstein Hagen.
Speculation as to why the increase in popularity points to the all-inclusive nature of a cruise (alcohol excepted) combined with the opportunity to visit many countries.
The convenience factor is a claim cruise marketers have been touting for decades and has finally caught on. That's particularly true with American travellers, who make up almost half of cruise passengers.
There’s also the advantage of seeing a half-dozen or more ports without the hassle of multiple airports and endlessly searching for restaurants. Everything from historic cities to tropical islands is packaged for easy consumption. And that is turning out to be a big draw for travellers who enjoy worry-free vacations.
Despite the increase in pricing, cruises can be a great deal compared to land trips with different hotels, restaurants, and land transfer costs.
“To the extent consumers are trading down to lower-cost options, cruises are still a relatively good deal,” Bloomberg noted.
