Cruise industry's capacity in the North American market may contract in 2017 in the wake of transfers of vessels to China, said Robin Farley, cruise industry analyst at UBS Securities in New York.
"CCL (Carnival Cruise Line) announced last week they will be deploying two more ships, 2,124-berth Carnival Miracle and 3,000-berth Carnival Splendor, to sail year-round in China starting in spring '17 and spring '18, respectively. While CCL had previously indicated a Carnival brand ship would go to China in '17, the '18 deployment was incremental," she said in a research note.
These redeployments will reduce the 2017 capacity growth to 0.8% from an earlier estimate of 1.3% and that of 2018 to 3.9% from 4.8%.
"We often know about ship withdrawals only a few months in advance, so the true net increase is typically a couple of percentage points lower than the gross increase, so we believe 2017E (estimate) could end up being negative for North American cruise capacity, which has never happened before," Farley said
