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LA Port: 1 Million Passengers Post-Pandemic

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The Port of Los Angeles started 2020 with a big announcement of building two new cruise terminals. Now, almost a year later, those plans have largely stalled.

“We had definitely some optimism going into 2020 before this all hit; that's one of the reasons why we were looking to create an RFP (request for proposal).) to build a new facility – the future was looking very good,” Chris Chase, the port’s marketing manager told Cruise Industry News. “Then, of course, everything came to a screeching halt.”

Now, the port cannot even tell when the construction of the terminals will begin.

“We haven't submitted the RFP to pick an operator or a builder for it. So, it's going to be a number of years before we break any ground,” Chase said.

According to Chase, Los Angeles is now working behind the scenes on its RFP process and requirements – as well as preparing to watch how cruise lines’ service resumes – to release the RFP “when the time is right.”

1-Million Goal

Thanks to cargo constituting 90 percent of its business, the port – despite a devastating nine months in cruising – reported Q3 of 2020 as the “best quarter ever”.

“Our cargo is off the charts big... Cargo is about 90 percent of our business. So, cruise represents a relatively small part of our business portfolio … even at our peaks (pre-pandemic), it was five or six percent of our business,” Chase said.

Talking about the port’s cruise priorities, Chase named building facilities for larger ships – as this is what the marketplace requires.

“For our marketplace, for where we sail here in Southern California – basically to Mexico and Hawaii – the macroeconomics, or even the microeconomics of those large ships, make it a better investment,” he said. “The advantage of being on a big ship, if you're only sailing at half capacity, you still have enough people onboard to hopefully make some money for the cruise lines… these guys need to make some money, otherwise, they're not going to sail.”

He explained that the Port of Los Angeles’ team sees its growth in two markets: Alaska, where the port has a “symbiotic relationship,” and Mexico – “along the Baja Peninsula, even into the mainland of Mexico, up into the Sea of Cortez.”

But ultimately, Chase said, as long as the port has one foreign port choice, which is Mexico at the moment, it’s fine. The port’s short-term goal is to get back to over a million passengers a year.

“Once the cruise lines start cruising again, people feel more comfortable, and the medical situation improves over the next number of months, I think there's a lot more opportunity that you can start looking at, down the line. Over the next five years, there's probably quite a bit of investment opportunity in both the homeports and the destination ports to create a more dynamic and exciting product,” he said.

A ’Transitional’ 2021

Chase said 2021 will be “very transitional” and it is from 2022 when the port will really take off.

“We think 2021 will not be a fantastic year for us. Because we just don't know when cruising starts. If cruising starts early and it keeps going, the back end of 2021 will be very good. 2022 will be a really good year for us as things get back to new operating procedures. People are comfortable, people will be traveling more again,” he explained.

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