Cruises - US - February 2007

Table of Contents

• Scope and Themes
• What you need to know
• Definition
• Abbreviations and terms
• Terms
• Executive Summary
• Snapshot of the market
• Build the ships and still they come
• Upping the ante
• North American market share eroding
• Destination still the key
• Texans take to cruising
• Market penetration still low--but for how long?
• Billion dollar industry
• The big three soon to be big four?
• Survey research--happy consumers; growing core of cruisers; keep perfecting the all-inclusive vacation
• A very bright future
• Market Drivers
• Overview
• Supply the key driver
  • Figure 1: North American passengers by state (top six), 2001-05
  • Figure 2: North American passengers by region, 1990-2005
  • Figure 3: North American passengers from North American ports, 2003-06
  • Figure 4: Awareness of number of close-to-home homeports, 2004 and 2006
  • Figure 5: Perceived benefits of more North American homeports, 2006
  • Figure 6: Impact of close-to-home ports on likelihood of cruising in next three years, 2004 and 2006
• To the core
• Changes in ethnic make-up
• Cruising to nowhere not the answer
  • Figure 7: Factors influencing last vacation decision (out of 10), 2006
  • Figure 8: Top cruise destinations (by passenger) from North American ports, 2003-06
• Hurricane fears or economic downturn?
  • Figure 9: Cruise destinations marketed in North America, 2002-06
• Europe--the Caribbean alternative
• Alaska setback
• Hawaii, Bermuda and Mexico to follow Alaska lead?
• A broader view of Panama Canal cruising
• Market Size
• World plays catch-up with North America
  • Figure 10: Ocean cruise passengers worldwide, 2003-06
  • Figure 11: Worldwide cruise supply and demand, 2006-11
  • Figure 12: New ships currently on order/option to 2011
  • Figure 13: North American cruise industry capacity/carryings, 2003-05
  • Figure 14: Capacity marketed in North America, 1990-2006
  • Figure 15: North American cruise passengers, 1990-2006
  • Figure 16: Global income/expenses of North American cruise industry, 2003-05
  • Figure 17: Impact of cruise industry on U.S. economy, 2002-05
  • Figure 18: Passenger/crew spending in the U.S., 2004-05
  • Figure 19: On-shore spending generated by 2,000-pax cruise ship, 2003-05
• Market Segmentation
  • Figure 20: New ships by sector, 1990-2009
  • Figure 21: New berths by sector, 2003-09
  • Figure 22: Trends in ship capacities across worldwide fleet, 2000-09
  • Figure 23: Brands, their owners and market sectors
  • Figure 24: Cruising costs, 2006
  • Figure 25: Average cruise length taken by North Americans, 1981-2005
  • Figure 26: Cruise duration trends and number of passengers--North America, 2003-05
  • Figure 27: Regional shares by cruise length, 2003 and 2005
• Supply Structure
• Overview
  • Figure 28: Cruise passenger nights by company and brand, 2003-06
  • Figure 29: Largest cruise brands (berths) in North America, 2007-11
• Major cruise brands
• Carnival Corporation
  • Figure 30: Carnival Corporation financial results, 2003-05
• Charters hit first quarter carryings
  • Figure 31: Carnival Corporation, Q1-Q3 2005-06
  • Figure 32: Carnival Cruise Lines (CCL) fleet/orderbook, 1 January 2007
• Draws back from size war
• First European venture
  • Figure 33: Costa Cruises fleet/orderbook, 1 January 2007
• Winter in the Mediterranean
  • Figure 34: Cunard Line fleet/orderbook, 1 January 2007
• Classy service
• Atlantic rovers
• Forty years on
  • Figure 35: Holland America Line fleet, 1 January 2007
• Signature of excellence
  • Figure 36: Princess Cruises fleet and orderbook, 1 January 2007
• Widest destination choice
• First world cruise in five years
• Repeat business high
• Balcony dining introduced
  • Figure 37: Seabourn Cruise Line fleet, 1 January 2007
• New president
• Figure 38: Windstar Cruises fleet, 1 January 2007
• Degrees of difference
• Other Carnival brands
• Royal Caribbean Cruises (RCC)
  • Figure 39: Royal Caribbean Cruises financial results, 2002-05
  • Figure 40: Royal Caribbean Cruises--Q1-Q3 2005 and 2006
• Fourth quarter profit predicted
• Oceania bid?
  • Figure 41: Royal Caribbean International/RCI fleet/orderbook, Jan 1, 2007
• Different routes to growth
• Mega flexibility
  • Figure 42: Celebrity Cruises fleet/orderbook, 1 January 2007
• On-board product overhaul
• Ship swap
• Star Cruises Group
  • Figure 43: Star Cruises Group financial results, 2002-05
  • Figure 44: Star Cruises Group, Q1-Q2 2005 and 2006
• MSC bid for NCL?
• Figure 45: Norwegian Cruise Lines (including NCL America sub-brand) fleet/orderbook, 1 January 2007
• Youngest fleet
• Ten-pin bowling on new ship
• Hawaiian gamble
• MSC Cruises
• Fourth-largest cruise company
  • Figure 46: MSC Cruises fleet/orderbook, 1 January 2007
• U.S. expansion postponed
• Luxury ship-within-a-ship
• Cruise brands not owned by top four companies (Carnival Corporation, Royal Caribbean Cruises, Star Cruises Group and MSC)
• Contemporary sector
  • Figure 47: Disney Cruise Line fleet, 1 January 2007
• Med sells out in North America
• Premium sector
  • Figure 48: Oceania Cruises fleet, 1 January 2007
• Luxury sector (by capacity)
  • Figure 49: Regent Seven Seas Cruises fleet, 1 January 2007
• All drinks now included in price
• New ship on horizon
  • Figure 50: Crystal Cruises fleet, 1 January 2007
  • Figure 51: Silversea Cruises fleet, 1 January 2007
• New source markets
• Key partnerships
• Figure 52: SeaDream Yacht Club fleet, 1 January 2007
• Bid for Seabourn ship?
• Sail-cruising sector
  • Figure 53: Star Clippers fleet, 1 January 2007
• Destination (soft adventure/expedition/coastal cruises) sector
• European programs
• Coastal start-up
• Budget sector
• Residential cruise sector
• River cruise sector
• Shipbuilding
• Changing nature of cruise fleet
• Issues against mega-ships
  • Figure 54: Trends in new ship prices, 2004-11
  • Figure 55: Cruise shipbuilders' market share of current orderbook, 2006
• Advertising and Promotion
• NCL--Against the tide
  • Figure 56: Norwegian Cruise Line--1, 2006
  • Figure 57: Norwegian Cruise Line--2, 2006
• Trumped on TV
• Hawaiian wedding
• Carnival tries to corner the "fun" market; the Queen Mary II sells a "once in a lifetime" experience
  • Figure 58: Carnival Cruises, 2006
  • Figure 59: Queen Mary II television travel show, 2006
• Royal Caribbean promises unlimited action
  • Figure 60: Royal Caribbean--1, 2006
  • Figure 61: Royal Caribbean--2, 2006
  • Figure 62: Royal Caribbean--3, 2006
  • Figure 63: Royal Caribbean--4, 2006
  • Figure 64: Royal Caribbean' s Celebrity Cruises, 2006
• Retail Distribution
  • Figure 65: Use of travel agents when booking cruises, 2002-06
  • Figure 66: Use of travel agents for booking non-cruise vacations, 2002-06
  • Figure 67: Information sources influencing last vacation choice, 2002-06
  • Figure 68: Would consider using Internet for cruise planning/booking, 2004
  • Figure 69: Cruise distribution channels providing best service, 2006
  • Figure 70: Typical contact method, 2002-06
  • Figure 71: Cruise distribution channel providing best prices (perception), 2006
  • Figure 72: CLIA travel agency affiliates, 1990-2006
• ICCL absorbed into CLIA
• Appreciating travel agents
• Online training for agents
• The Consumer
• Introduction
• Summary of consumer survey highlights
• Cruises taken in the past three years
  • Figure 73: Incidence of taking cruises and number taken in past three years, by gender, May 2005-June 2006
  • Figure 74: Incidence of taking cruises and number taken in past three years, by age, May 2005-June 2006
  • Figure 75: Incidence of taking cruises and number taken in past three years, by income, May 2005-June 2006
  • Figure 76: Incidence of taking cruises and number taken in past three years, by race/ethnicity, May 2005-June 2006
  • Figure 77: Incidence of taking cruises and number taken in past three years, by cohort, May 2005-June 2006
• Why people go on cruises
  • Figure 78: Incidence of taking a cruise in past five years, December 2006
  • Figure 79: Reasons for having taken a cruise, by gender, December 2006
  • Figure 80: Reasons for having taken a cruise, by age, December 2006
  • Figure 81: Reasons for having taken a cruise, by income, December 2006
• Why people don' t go on cruises
  • Figure 82: Reasons for not taking a cruise, by gender, December 2006
  • Figure 83: Reasons for not taking a cruise, by age, December 2006
  • Figure 84: Reasons for not taking a cruise, by income, December 2006
  • Figure 85: Reasons for not taking a cruise, by race/ethnicity, December 2006
• What would entice non-cruisers to go on a cruise
  • Figure 86: What would entice you to go on a cruise, by gender, December 2006
  • Figure 87: What would entice you to go on a cruise, by age, December 2006
• The Future
• Bright future--interest in cruising up 43%
  • Figure 88: Projections for core market in next three years, 2004 and 2006
  • Figure 89: Projections for affluent adults 25+ with HHI of $60K+ and with HHI of $80K+, 2004 and 2006