Cruise lines operating in the eastern Mediterranean - which includes Southern Italy, the Greek Islands and Turkey - will draw well over 251,000 passengers in 1989, including passengers from North America and Europe. Last year, $240 million was generated by the cruise industry into the Greek economy. This figure represents $40 million more than in 1987 and is expected to increase further in 1989.

Despite the rash of terrorism in the Mediterranean in 1985 and 1986, the Mediterranean market is showing growth this year and ranks second as an operating area for cruise ships. According to a capacity analysis done by Cruise Lines International Association (CLIA), the Mediterranean held 7.40 percent of the North American cruise market capacity in 1988 compared to 4.29 percent in 1986 and 8.91 percent in 1984.

The marketshares translate into more than 200,000 Americans cruising in the Mediterranean last summer (at an estimated 80 percent fleetwide occupancy rate by Americans) of which an estimated 80,000 cruised in the eastern Mediterranean, based on estimates by the cruise lines operating in that area.

Corresponding numbers for the Mediterranean in 1986 were 80,000 American cruise passengers and in 1984, 140,000.

Andy Cristo, Vice President of Sales and Marketing at Epirotiki Lines summed up the overall feeling of the industry when he said, "Although this year we are close to coming back to our old load factors of 1984, we are hopeful we will reach those levels next year." In fact, Stanley Buchin, Senior Vice President of Temple, Barker & Sloane a management consulting firm specializing in travel felt that in 1990 most lines in the Mediterranean will surpass their high load factors of the early 1980's as long as the area remains politically stable.

Political Affects

When bookings began to drop in late in 1986 a number of lines repositioned their ships to either Northern Europe or the United States' East Coast or Alaska.

Those who stayed in the Mediterranean, especially in the Eastern Mediterranean, during this period experienced an extreme reduction North American passengers. In 1986, Epirotiki Lines had a 70 percent drop in bookings: Cristo noted that the company did not pull out, but instead looked for other markets in Japan and Australia. Sun Line Cruises also felt the pinch. Before 1985, 71 percent of their passengers were from North America, compared to 45 percent in 1987 and 55 percent anticipated in 1989.

Chandris Fantasy Cruises also had a great reduction in North American passengers in 1986 and 1987. According to Al Wallack, Senior Vice President of Marketing and Sales, although the numbers are up this year, they are not yet on par with the early 1980's. He felt that part of this was due to some remaining hesitancy of American travellers, but there is also competition now from other cruise areas which were developed in 1986 and 1987.

Debbie Adams, past President of National Association of Cruise Only Agencies (NACOA) and owner of The Ship Shop travel agency said that the Baltic was their number one destination this year. "In 1986 and 1987, people were offered Scandinavia and the Baltic Sea as an alternative to the Mediterranean. Now people are more aware of these new itineraries and have more choices," she said.

Many felt that Americans are no longer fearful of cruising the Mediterranean. Buchin expressed doubt that there was much hesitancy on the Part of American travellers regarding cruising in the Mediterranean.

Some lines such as Costa Cruises claim not to have been as affected. Mitchell Schlesinger, Senior Vice President of Marketing, said, "Because of our ability to generate traffic in Europe, we never had a reduction of passengers in 1986 and 1987." Presently, 60 percent of Costa's passengers are Europeans primarily from Italy, Germany, France and England. 

European Market

The percentage of Europeans travelling in the Mediterranean on cruise lines that also market in the United States ranges anywhere from 10 percent to 70 percent. Dolphin Hellas Cruises, whose passengers are 70 percent European, has its main office in Piraeus with a smaller office in Los Angeles. Fort Lauderdale-based Ocean Cruise Lines whose Mediterranean-bound passengers are well over 25 percent European, has its European sales and operations office in London. Epirotiki cited that 50 percent of their Mediterranean passengers are from Europe, Australia and Japan.

Market Leaders

Of the 11 major lines in the Eastern Mediterranean this year, Epirotiki dominates with approximately 72 percent of the market. Their fleet of 10 ships range in size from 180 to 700 pasengers, affording 5,000 - 6,000 total berth capacity. Sun Line, along with Chandris, follow Epirotiki with approximately eight to nine percent of the market.

With Epirotiki claiming almost 3/4 of the market some felt there is not a lot of room for newcomers. Dolphin entered the American market in 1988 and according to its President, Philip E. Potamitis, "The American market is a bit soft. Marketing the Mediterranean to Amerincans is a very fragile undertaking."

On the contrary, Buchin felt there is always room for more companies in the Mediterranean. Much, he said, is based on how each line sells its cruises. He cited, for example, that smaller lines can pursue inclusion in American Express or TWA packages to the Mediterranean rather than direct selling. This, in fact, explains in part Epirotiki's success, since 65 percent of its business is from major wholesalers such as TWA Getaway Vacations.

Incentives and Charters

Areas of future growth include incentives and charters. According to Arne Egeland, Director of Sales for Sun Line, 1990 promises more incentive business travel for his company. While eight percent of their Mediterranean sales this year were from groups, he expected more next year. While, incentive groups rarely charter an entire ship, Epirotiki claimed that its ships were often chartered anywhere from one week to six months.

Half of the 1989 season for Dolphin Hellas' Aegean Dolphin was chartered mainly to European businesses. According to Potamitis, the facilities on the Dolphin lend themselves to business conferences, since the ship has numerous meeting and conference rooms and a theater for lectures.

Future

Most industry sources agree that the future looks bright for the eastern Mediterranean, as long as terrorism does not rear its ugly head in this area. Resolution of ongoing political problems in the Middle East would obviously help growth. As Potamitis expressed, "It will really be a banner year for us as soon as the Middle East settles down."

But most are already expanding beyond their 1989 projections. Chandris, for example, had a load factor in 1988 which was 20 percent ahead of their projections and this year they are also ahead of anticipated numbers since most cruises are reported to be sold out. Costa is adding another ship, the 800-passenger capacity Costa Marina to the Mediterranean in 1990. The rebuilt vessel will offer seven-day cruises, stressing pre- and post-trip extensions.

History and Leisure

A number of lines, including Sun Lines, have also added ports in Turkey, such as Bodrum, to their itineraries at the request of passengers. By adding more of Turkey, they are attracting repeat passengers who may have seen just the Greek Islands on their first trip. Those who cruise in the eastern Mediterranean tend to be well travelled and are looking for new and interesting sights to explore, according to Egeland.

The abundance of ancient history in this area is perhaps what attracts passengers to the Mediterranean rather than the Caribbean. Potamitis said, "We offer leisure and education, since there is 2500 years of history in Athens and Rome alone."