Trends Report, June 1, 2006 The North American cruise industry celebrates rise in passenger numbers and revenues, largely due to multi-generational travel.

A recent press conference hosted by the Cruise Lines International Association (CLIA) revealed just how much the cruise industry is prospering these days.

Calling 2005 a year of “sustained growth” because three new ships were launched and three were reintroduced, CLIA Chairman Andy Stuart noted that 22 more ships are in the works with launch dates from later this year through 2009.

Mr. Stuart emphasized that this $13.5 billion investment is being made in an industry that has grown at an average of 8.5% per annum since 1980. CLIA statistics show that a record number of 11.19 million passengers sailed on itineraries around the world in 2005.

In sales news, a CLIA-member travel agents’ survey revealed that more than 47% of recent bookings were 6 months or longer in advance of sail dates, a strong indicator that last-minute discounts may fade from the horizon. CLIA agents forecast the five most popular cruise destination for 2006 to be the:
♦  Caribbean (87.6%)
♦  Alaska (85%)
♦  Hawai’i (52.8%)
♦  Mediterranean (40.1%)
♦  Northern Europe (37.9)

Noting that more exotic itineraries, such as the newly opened Libya or ports in the Pacific-Asia region, were popular in 2005, CLIA president Terry Dale forecast continued strong demand by repeat-cruise consumers in 2006.

CLIA’s market research attributes cruising’s continued popularity to its value for money pricing, inclusive nature, expansion of close-to-home ports, variety of onboard experiences, and the industry’s efforts to exceed customers’ expectations in terms of entertainment, programs, shore excursions and amenities.

He praised industry partners for marketing their diversity to consumers, encouraging potential cruisers to consider each line’s differentiating factors rather than price in making their decisions.

“One of the key trends is multi-generational travel,” Mr. Stuart added, citing the “enormous” cruise demand from families traveling together. Mr. Stuart credits this “explosive growth” to the increased number of affluent baby boomers who can afford to treat everyone to a cruise, as well as to more affluent parents, who pay for both parents and children on family vacations.

In response, he notes that the cruise industry has focused on “this very, very powerful emerging segment [and] has stepped up to meet the needs of this emerging customer” by designing new ships with spacious cabin configurations and updating all children’s facilities.