MIAMI -- The troubled economy was the main theme at the Seatrade Cruise Shipping convention's annual state of the industry panel here last week, with cruise line presidents expressing confidence in the industry's ability to survive a downturn.
Dan Hanrahan, president of Celebrity and Azamara Cruises, said that the cruise industry was not necessarily "recession-proof" but that it had proven to be "recession-resistant."
The panel of six cruise line presidents overwhelming agreed that the industry's fundamentals gave it an edge over other discretionary products.
"There is no vacation that offers the same value as a cruise," said Carnival Cruise Lines CEO Gerald Cahill.
Despite his optimism, Cahill reminded the audience that cruising was still a choice, and he added that the market concerns had affected the cruise industry: "The stock prices for publicly traded cruise companies are reflecting those fears."
The executives pointed out that historically cruising has shown resilience to periods of economic downturn.
"There is a belief among people that they deserve their vacation," said Hanrahan. "That is part of what let us weather the storm so far."
Rick Sasso, president of MSC Cruises USA, said the industry had dealt with economic downturns and adversity in the past by continuing to invest in its product. He added that during economic downturns, the industry should exploit the value of a cruise over a land-based vacation.
"It has always been a challenge to move market share and penetration, and that challenge becomes easier as this value proposition becomes greater," he said.
Hanrahan pointed out that Europe still offered great opportunity for the industry. He said Europe's passenger growth pattern since 1993 had been similar to what the North American cruise market experienced in its largest growth period, between 1980 and 1994.
On the upscale cruising panel later that day, SeaDream Yacht Club president Larry Pimentel said that despite the fact that his very small ships were sailing very full and given the current economic climate, he was happy to not have any new tonnage coming on in the next year.
"This is the first time in my life... that I am awfully happy I don't have inventory coming on line in 2009," he said in a separate interview. "Cruising will do well in the long term, but there will be some short-term blips. We will see it more in the fourth quarter, and we will see it reported in the first quarter of next year."
To contact reporter Johanna Jainchill, send e-mail to [email protected].