Norwegian Cruise Line Holdings CEO Frank Del Rio said the
company's decision to return to the Eastern Mediterranean in 2019 is working
out so far.
After pulling out of the region in 2016 because of terrorism
fears and political instability in Turkey, NCLH has scheduled 12 sailings this
year, and has an additional 20 on the calendar for 2020.
"All 12 sailings in 2019 are better loaded and at
higher pricing than the surrounding sailings that do not include Turkey,"
Del Rio said.
He told investors on a conference call to discuss fourth
quarter and 2018 earnings that Turkey is the key to the itinerary.
"The fact that the North American consumer, who is the
one booking most of these Eastern Mediterranean cruises, seem to want to come
back to the eastern Med and is willing to pay a premium price bodes very well
for 2020," Del Rio said.
The risk is that itineraries must be developed and sold 18
to 24 months in advance of sailing, he continued.
"So you test the waters, you see what happens, and it
takes you a while to really ramp up. So at this point, assuming there are no
other disruptions -- reasons to not go to the Eastern Med -- I expect that we
along with the rest of the industry will probably increase the number of
deployments to the Eastern Med beginning in 2020 and even more in 2021."
Del Rio, who has a hand in all itinerary planning at NCLH,
said that when the eastern Med is good, "it's as good as any, if not the
best, of all itineraries."
On the call, Del Rio said NCLH enters 2019 in the best
booked position in its history, giving yield managers more leeway to raise
"We're pushing prices higher wherever we can," Del
Rio said. "While we still have a lot of cabins to fill, the emphasis will
be on raising prices -- on all three brands."
In addition to Norwegian Cruise Line, NCLH operates Oceania
Cruises and Regent Seven Seas Cruises.
The company had net income of $954.8 million in 2018, up
25.6% from the $759.9 million recorded a year earlier. Revenue rose 13% to $6.1
Last year, NCLH decided to redeploy the Norwegian Joy from
China to Alaska, where it will cruise starting in April alongside sister ship
Norwegian Bliss. That will increase NCLH's presence in Alaska to 9% of total
capacity, up from 7% last year.
Capacity in the Asia Pacific region will drop to 6% from 12%
last year. NCLH will have six ships in Europe this summer and capacity there
increases to 23% from 20% last year, while year-round capacity in the Caribbean
is pegged at 36%.