Record new ship introductions are expected during 1992, but ship sales and redeployments will help the market absorb the new tonnage.

In spite of the 11,673 new berths that were introduced in 1991, ship sales and deployments in markets outside of North America reduced the net berths being added to the market here to 3,365.

1991-1994 overall net capacity growth is likely to be much less than previously anticipated. Much of the capacity growth is concentrated in certain markets, however, including the contemporary Caribbean market, the premium market, and the expedition market.

Based on current demand projections and confirmed new capacity, by 1995, the industry-wide load factor could be as high as 116 percent while the average bed-day utilization rate could reach 101 percent.

The net increase in passenger capacity during 1992 will be 433,100 based on known ship introductions and withdrawals.

However, more ship sales and deployments outside the North American market are expected which of course would reduce the net addition of capacity in the market here.

Consequently, the net overall capacity increase during 1992 will be 10.1 percent or less.

Adjustments: Industry projections also call for NCL to sell the Southward, the Starward and the Westward; for Carnival to sell or redeploy the Mardis Gras and the Carnivale; and for Princess to sell the Dawn Princess and Fair Princess. In addition, the industry grapevine says that additional ships are for sale ranging from the budget level to the very top end of the market. Consequently, if these actions take place, the 1995 fleet can be expected to be reduced to about 125 ships representing 96,821 berths with a passenger capacity of 4,629,289.

Noteworthy: The 1995 North American cruise fleet is likely to be smaller than previously predicted and indeed much smaller than projected maximum growth scenarios.

Since 1989/90 three factors have impacted industry capacity growth: 1) fewer new ships have been ordered than was then anticipated; 2) more ships have been sold and/or deployed outside of the North American market than was anticipated; and 3) market circumstances have forced some cruise lines to deploy ships only seasonally, even marginally, in the North American market.

The net result is that net capacity growth in 1991 lagged market expansion; in 1992, capacity growth will equal or be less than projected market expansion; for 1993, 1994 and 1995, market growth should easily outpace capacity.