While the NSW government has allowed some ships to berth at a military facility to help Sydney’s congestion issues, they have also introduced a $20 per head passenger fee, set to roll out next season, and increase annually.
If Alaska is any indication, cruise lines do not like head taxes, but as the Australian market grows, government authorities look to regulate and take a piece of the pie in a growing market.
“This season will be the biggest season to date in Australia with the two biggest cruise lines, Carnival and Royal Caribbean deploying larger and newer ships to the region in the 2012/13 season,” said Chris White, chairman of Cruise Down Under.
The NSW government did cite the money it was spending on infrastructure for cruise ships as a driver to the head tax, and said it needs help meeting those costs.
Added White: “There is no doubt that cruise lines will be looking carefully at their bottom line with the introduction of the head tax in Sydney. The NSW Government is investing a significant amount of money in cruise infrastructure at White Bay, in Sydney, however the industry would like to see some of these funds allocated to finding a solution to a cruise ship facility east of the Sydney Harbour Bridge.”
Nevertheless, a new terminal is planned for Sydney, and another heavy-hitting port, Auckland, is also building a new facility .
“Auckland has plans and funding approved to build a second terminal on Queens Wharf. Plans are already in motion and construction is planned to begin in September 2012,” said Wayne Mills, general manager of marine and multi-cargo for the port.
“Sydney has introduced a high head tax this year so clearly Auckland may be a more attractive option to the lines going forward. We suggest the lines look to complete turnarounds in ports that are cruise friendly and offer value for service,” he continued.
Head tax debate aside, multiple cruise operators have told Cruise Industry News, that port fees in Australia and New Zealand are unacceptable, especially for the major turnaround ports, and have also noted congestion and infrastructure issues as stumbling blocks to growth in the region.
“The peak month in Australia for ships requiring berths is February and whilst the announcement of an extra three berths at Garden Island is welcomed, the growth of the industry will be hampered if a long term solution is not found,” added White.
See the full Asian/Australian market report in Cruise Industry News' special Asia issue for the Cruise Shipping Asia-Pacific conference in Singapore Sept. 17 to 18.