While the build-up of European brand capacity continues, it is being offset somewhat by ships being moved out during the winter due to the lingering effects of the upheavals in Northern Africa and the Middle East and the downturn in the economies of several European countries, according to the 2012 Cruise Industry News Annual Report. And Royal Caribbean has so far announced it will have nine ships in Europe next year, compared to 12 this year. 2012 is going to be a trying year and 2013 may be even more so.
Barring any unforeseen changes, the European brands’ cruise capacity will be about 7 million passengers by 2016, in addition to another estimated 750,000 Europeans carried on European cruises by Royal Caribbean, Celebrity Cruises, Norwegian Cruise Line and Princess Cruises, among the larger North American-based operators. By 2016, the total European passenger count may be in the range of 8 million.
Growth is rarely linear, however. This year is seeing some softening in demand, especially in Southern Europe, which is being attributed to the Costa Concordia incident, and to the soft economies of Spain, Italy, Portugal and Greece. There is also some softening in the UK market with very low price offers.
Germany is reportedly going strong, but will have to absorb more new ships from AIDA in 2012 and 2013 and again in 2015 and 2016, plus a new TUI ship in 2014 and possibly another in 2015. In addition, more German tour operators are entering the market with second-hand tonnage positioning themselves as premium and niche products.
The two largest brands, Costa Crociere and MSC Cruises, are also continuing to grow with new ships either under construction or on the drawing boards.
And there are newcomers in the market, such as Viking Ocean, which pending completion of financing, has ordered two medium-sized ships for deliveries in 2014 and 2015. Other companies are also considering entering the market, according to financial sources.
In terms of passenger-carrying capacity, Carnival brands control more than 47 percent of the market in 2012 and will control nearly 50 percent by 2016, followed by MSC Cruises with more than 22 percent now and just short of 22 percent by 2016.
The Carnival brands are market leaders in most countries and market segments, whether contemporary, premium or budget markets. But it is notably not in the expedition market.
Ultimately, to achieve the 3.3 percent market penetration of North America, European markets must generate 13.5 million passengers – or about double the number of European passengers the cruise fleet carries today. That is not an inconceivable number, but there are two hurdles: In order to reach that passenger number, the industry must ramp up its building rate, as there simply are not enough ships to carry that many passengers. And secondly, ports will come up short if they have to accommodate twice as many passengers with their current facilities.
The Cruise Industry News Annual Report 2012 is the only information resource of its kind -- presenting the entire worldwide cruise industry in 350+ pages, from new ships on order to supply-and-demand scenarios from 1987 through 2016, including a future outlook through 2030, growth projections for each cruise line, and detailed ship deployment by region and market of all the cruise lines. Click here to order.