Patrick Ryan, managing director of the European Cruise Council, pointed out that additional consolidation is not something he sees in the European market primarily because "the rich pickings are already taken".

"While I'm sure there are discussions to be had, with some smaller lines their financial viability is in question, as they do not have economies of scale and are not financially independent," Ryan said.

He also noted that larger companies can run the risk of oversaturation if they own more than one cruise line in the same niche.

With Carnival Cruise Lines owning AIDA, they would be unlikely to go after a smaller German line, according to Ryan.

"And as the years go by, older ships are becoming less attractive as acquisition targets," Ryan added. "To refurbish a smaller ship in a niche market is just not worth it; it's like throwing away money."

But older tonnage generally has a character often missing from newbuilds, underlined Gisa Deilrnann, managing owner of Peter Deilmann Reederei. "Repeat guests have an affection for that," she said. "While newness has a certain appeal, so does the tried and true."

"The European travel industry is very different than the U.S.," explained Fred Olsen Cruise Lines' Director of Marketing Nigel Lingard. "It's much more complex and sophisticated, as holidays are often tailored here to passengers' particular needs. I see smaller lines continuing to specialize in their niche sectors; there will always be a demand for that."

Sebastian Ahrens, managing director of Hapag-Lloyd, said that there is "some likelihood that consolidation will continue," pointing out that smaller lines could be swallowed if they do not have a fleet with uniquely positioned vessels.

As an example, he noted that the Hanseatic is extending her expedition cruise calendar with new destinations such as the Gambia River and a total of more than 100 new ports being visited in 2005 and 2006.

David Selby, head of cruise for Thomson Holidays does not view future consolidation as a concern for the European market.

"In North America, nearly all cruises are controlled by three major companies; but in the U.K., the total is slightly more than 50 percent," Selby pointed out, noting that is due in part to many tour operators and smaller lines selling directly to the public.

Thomson has recently doubled its fleet, and according to Selby, the line will have a passenger capacity of 70,000 this year and 140,000 in 2005.

Selby said that Thomson would also consider a more market-segmented appeal such as year-round Mediterranean cruising.