River cruising appears to be beating the odds in Europe, and Avalon Waterways is feeding on the momentum with a plan to have a 10-ship-strong river cruise fleet by 2010.
"If you talk to tour operators and ask about their European business for 2008, the honest ones will tell you it's probably down. River cruising is up," said Patrick Clark, managing director of the Littleton, Colo.-based Avalon, which is owned by the Globus family of brands. "So, [Avalon is] a brand growing despite the challenges."
In April, Avalon launched its sixth ship, the Avalon Scenery. Next year it plans to add two more ships to the European waterways, the Avalon Affinity and the Avalon Creativity. In 2010, two more Avalon ships will set sail.
Another factor that has helped Avalon, as well as other river cruise operators, in the face of an economic turndown and an ever-weakening dollar is the all-inclusiveness of river cruising.
"It is the ability to buy something in U.S. dollars and pay for virtually everything except your gratuities and maybe a bar bill before you leave the country," said Clark. "You don't have to worry about currency differentiations or currency shock when you get back and get your Visa bill. It's a very strong argument for a good value product, paid for in dollars. "
For 2008, Clark anticipates 20% growth in year-end sales for Avalon compared with 2007. And early-2009 bookings are already up 30% compared with this time last year.
But Clark admitted that healthy growth figures aren't the only thing spawning Avalon's aggressive shipbuilding strategy. Some of it is pure logistics. There are only a few shipyards that build river ships. Tough economic times or not, if companies want to ensure competitive fleet growth, they've got to get in their orders early.
"The fact is, the shipyards right now are busy," said Clark. "And we got orders in knowing that the demand would increase. Yeah, '09, there are uncertainties. There are things that can happen that can change all of what we're talking about. The fact is, we feel strongly about getting the ships and getting those delivery positions and getting our orders placed."
Three options
In 2003, Globus launched the Avalon brand when it realized it needed to get into the booming river cruise game. According to Clark, Globus recognized it had three options: have a charter river program, buy an existing river operator or create its own brand and fleet.
Globus went with the third option, and one year later it launched its first new ship, the Avalon Artistry, a 178-passenger ship, 426 feet in length with a wheelhouse at the front of the ship.
Avalon positioned its product as a contemporary alternative to some of its competitors, said Clark. Staterooms and common areas have simple, geometric details in contrast to some of the more ornate appointments on other river cruise ships.
In 2005, Avalon introduced the Artistry's sister ship, the Avalon Poetry, with 84 staterooms and four junior suites, also 426 feet in length.
In 2006, the Avalon Tapestry set sail and in 2007, Avalon Tranquility and Avalon Imagery were unveiled. These three sister ships were built slightly different from their predecessors, with the wheelhouses at the aft of the ships, essentially pushing the ships through the water and creating a much quieter ride, said Clark. The ships were also built slightly larger, at 443 feet.
A new generation of ships
Now, with the newest Avalon Scenery and with the four new ships in the pipeline, Avalon is building the ships smaller and has changed shipyards to do so. The first five ships all came out of a shipyard in Germany. The Scenery, and the four ships scheduled to hit the water over the next two years, are all being built in the Dutch shipyard Den Breejen.
The Scenery measures 361 feet in length, with 67 staterooms and two junior suites. The Affinity and Creativity will follow suit, with similar measurements and stateroom appointments.
On all the Avalon ships, 85% to 90% of the staterooms have floor-to-ceiling, sliding glass doors and French balconies, according to Clark. The ships all also feature WiFi Internet access and free regional wines with meals onboard. The newer ships all have an additional lounge at the rear of the ship, a growing trend on newer river ships. They all also feature the standard fitness center, salon, whirlpool and sky decks.
The average age of passengers on Avalon ships is 63, but the age range is about 45 to 85, said Clark. Younger passengers, who are still in the work force and have a hard time taking longer periods off work, tend to book the shorter river cruises. So Avalon is making sure to include an assortment of shorter and longer cruises in its 2009 brochure. The company is also considering making bike rentals an option for passengers, an amenity that is also known to attract a younger clientele.
As for itineraries, Avalon is expanding those as well, adding six routes for 2009, including a 13- to 14-day Paris-to-Amsterdam and reverse itinerary; a 14-day Vienna-to-Bucharest, Romania, and reverse itinerary; and a 18-day Shanghai-to-Beijing cruise on the Yangtze River in China on Victoria Cruises' Victoria Anna and Victoria Jenna.
In addition to its in-house European program, Avalon has charter programs in China, Egypt and in the Galapagos.
Clark said that Avalon's pricing falls somewhat in line with competitor Uniworld's prices. For example, Uniworld's 2009 nine-day Burgundy-Provence cruise in France runs between $2,049 and $2,649, cruise only, while Avalon's 12-day Burgundy-Provence cruise runs between $2,209 and $3,309, cruise only. But Avalon definitely falls below Viking River Cruises' prices. Clark said that part of the reason for coming in a bit lower than some competitors is because Avalon doesn't "get into the discounting game."
When it comes to river cruising, said Clark, each company has a slightly different strategy in trying to sell slots, Avalon included.
"There's a philosophy here that is different."