The news that P&O Cruises Australia will receive the 55,000 gross ton Statendam and Ryndam from sister brand Holland America Line in 2015 highlights a trend whereby Eastern Pacific source markets are becoming a third strategic leg for the cruise industry, in addition to North America and Europe.
Only a short while before that, Costa Crociere, another brand of Carnival Corp & plc group, had unveiled a decision to base the 114,000 gross ton Costa Serena year round in China as the third ship of the company to operate from there on a year round basis. This again was a counter-attack to Royal Caribbean group’s substantial increase of foothold to take place in China next year, but also Star Cruises’ fleet expansion.
The positive news is that Asia-Pacific source markets, with China and Australia in particular, are becoming a third stratetic leg for the cruise industry. China is forecast to overtake the UK in2017 by Carnival to become the world’s second largest source market for cruises, while Australia is likely to reach 1.0 million passenger mark by 2016, three years earlier than forecast so far, according to Ann Sherry, head of Carnival Australia.
With capacity moving to the eastern Pacific, there will be more room for attempts to drive up yields in Europe and North America, which remain well below their 10 year highs for both Carnival and Royal Caribbean groups.
Although these source markets increasingly absorb new ships, at least in the case of Australia, there is still room to employ older tonnage as well: the two ships to be transferred to P&O Cruises Australia both date from the early 1990s. With the second hand market virtually extinct, this allows profitable use of ships that might be difficult to trade profitably on other markets, yet which still have a good number of service life left from technical point of view.
The bad news is that Australia, which had a population of 22.7 million in 2012, cannot be expected to sustain double digit growth of its cruise passenger numbers is all eternity. However, it may still take a good many years until a ceiling will be reached.
Also, it seems that Japan remains a tough nut to crack for western cruise operators, at least for as long as higher returns appesr to be available in China and Australia.
