Preview 2015: Cruise

The 4,200-passenger Norwegian Escape, due late in the year; it is one of two big ships that will be delivered in 2015.
The 4,200-passenger Norwegian Escape, due late in the year; it is one of two big ships that will be delivered in 2015.

The flood of cruise cabins sloshing around the Caribbean will finally ebb in 2015, bringing with it the prospect of higher pricing.

At Royal Caribbean Cruises Ltd. (RCCL) alone, Caribbean capacity next summer will be down 5% year over year, although it doesn't begin to decline until after the first quarter.

In a conference call with analysts, RCCL Chairman and CEO Richard Fain said he expected a "noticeably better operating environment for the last nine months of 2015."

Royal will have close to 70% of its total capacity in the Caribbean in the first quarter, officials said.

The moderation in supply growth is prompting more confidence about price increases at Norwegian Cruise Line, according to a report by Patrick Scholes, an analyst with SunTrust Robinson Humphrey.

Scholes said the company's big addition for 2015, the Norwegian Escape, is being advertised at rates that average 10% higher than the rest of the fleet. The 4,200-passenger Escape, due late in the year, is one of two big ships that will be delivered next year, along with Royal's Anthem of the Seas, also 4,200 passengers, in April.

To make room for bigger, newer ships, cruise lines in 2015 are divesting some of the older, smaller ships that no longer fit with the rest of their fleets.

In Royal's case, that means the 2,350-passenger Majesty of the Seas will be transferred to RCCL's Spanish-based Pullmantur brand in May. Built in 1992, the Majesty had only one deck of balcony cabins and looked increasingly out of place next to Royal's newest ships.

Likewise, Celebrity Cruises has sold its remaining Century-class ship, the Celebrity Century, to a new joint venture in China that it formed with the Chinese travel mega-company The newly formed venture plans to begin operating the ship for Chinese passengers around midyear.

Other fleet departures in 2015 include the Holland America Line ships Statendam and Ryndam, which leave in November to begin sailing for P&O Cruises Australia, and the Seabourn ships Legend and Spirit, which will depart in April and May to sail for Windstar Cruises.

Princess Cruises will say goodbye to the 684-passenger Ocean Princess in 2015, after taking delivery of the 3,560-passenger Regal Princess this year.

River convergence

Another trend emerging in 2015 is the confluence of river and ocean cruising, starting with river cruise giant Viking Cruises, which is taking to the seas in April with its 928-passenger Viking Star.

Next year will also see the launch of Celebrity Cruises packages that bundle a European ocean cruise with river cruises provided by Amras Cruises on the Danube, Rhine, Rhone and Seine rivers.

Some of the most anticipated debuts next year will be in Asia, notably the arrival of the Quantum of the Seas in June in Shanghai, where it is scheduled to take up permanent residence to serve the Chinese market.

Carnival Corp.'s push into China has yielded a tentative deal to build a "world-class cruise ship" in China through a joint venture with the China State Shipbuilding Corp. and the Italian shipyard Fincantieri.

In the meantime, the deployment of Costa Cruises' 3,780-passenger Costa Serena to Shanghai in April will give Carnival Corp. four ships homeported in China in 2015.

Back in North America, tighter air pollution rules for cruise ships that take effect on Jan. 1 will limit emissions of sulfur dioxide in the North American Emissions Control Area to 0.1% by weight, down from 1% previously. Cruise lines are complying by adding scrubbers that treat exhaust gases, a process that will unfold over several years.

The coming year might also see a quieter regulatory climate for cruise lines with the retirement of one of the industry's most dogged critics, Sen. Jay Rockefeller (D.-W.Va.).

Internet speeds at sea are poised to get faster with the rollout of new technology from Royal Caribbean and Carnival. Royal began testing midorbit satellites in the O3b network on several of its most modern ships, and it will make the service more widely available in 2015.

Carnival is using a hybrid of land and satellite links to quicken Internet speeds. It started with the Caribbean region in the fourth quarter and will be building out the needed infrastructure in Alaska in 2015.

Finally, there will be new leaders for several large cruise brands, including Drew Madsen at Norwegian, Michael Bayley at Royal, Orlando Ashford at Holland America and Christine Duffy, recently named to replace outgoing Carnival chief Gerry Cahill.


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