A couple of weeks ago, the Passenger Shipping Association celebrated its 50th anniversary at the National Maritime Museum in Greenwich, using the occasion to announce just how buoyant (if you’ll forgive the pun) cruising had been in 2007.
Some 1.33 millions Britons took a cruise in 2007 – 11 per cent more than in 2006 – and the numbers are forecast to reach 1.5 million this year and two million by 2012.
Could the timing of the announcement have been any worse? House prices are falling, the cost of mortgages and fuel is rising, and my weekly shopping bill has risen noticeably for the first time I can remember since leaving home many years ago.
And just as prices at the pumps rise daily, cruise lines have started to play follow-my-leader with fuel supplements. One increases, they all follow.
Since I wrote about fuel supplements in this column on May 21, less than a month ago, there has been another spate of price rises among cruise lines, including Fred Olsen, Norwegian Cruise Line and Carnival UK, the umbrella company for P&O, Princess, Ocean Village and Cunard.
Carnival UK is charging £4.50 per person a day, NCL $11 (£5.50), Fred Olsen £5. Added up over a week for two people, that is a lot of extra money to budget for on top of the cost of the cruise.
But ask the cruise lines if bookings are slowing as a result of this, or the general economic situation, and they adopt their best Jim Callaghan position. Crisis? What crisis?
They say bookings have not been affected because holidays – and especially cruises – are considered a necessity these days and consequently are the last thing people will give up when times get hard.
Of course, they would say that. Few companies, whether selling cruises, cars or computers, willingly admit when business is bad.
Their second point is valid though; cruisers might be getting younger, but most people who cruise are still aged 55-plus and are financially comfortable. They probably own their homes, so higher mortgage rates are not a problem, and they have substantial savings. “Most of our customers pay for their cruises by cheque,” one cruise travel agent told me. He said bookings faltered for a while earlier this year, but he is now taking more bookings than at this time in 2007.
“There was initial concern about the credit crunch, but people are bored of it and are just getting on with life.”
However, there are signs that all is not as it should be in the cruising world.
Carnival Cruise Lines is pulling its ship from the Mediterranean next year. This is because it is popular mainly with Americans, and the line fears that they won’t be coming to Europe if airline prices keep rising and the euro stays strong. The ship, Carnival Freedom, will instead stay in the Caribbean, the American cruise lines’ bolthole after 9/11.
And there are a lot of cruise bargains out there if you look, which suggests bookings are sluggish, or at least that there is still a lot of capacity to fill, whatever the lines might say.
I was amazed to see an offer at the end of last week for Oceania Cruises – £999 per person for 12 nights in the Mediterranean in October, including a flight. That’s less than half of the full fare, even if the price was for an inside cabin – another £250 on the same cruise would have bought you a balcony. And this is for a premium cruise line that is always telling me it has waiting lists for its waiting lists.
At the other end of the cruising spectrum, casual cruise line Island is selling seven nights in the Med from £429 per person, down from £699, or family cruises (two adults and a child) from £1,697 – saving almost £800. And this doesn’t just pay for the cruise, but also for flights and transfers.
“Bookings are slow so cruise lines have brought down prices and cruisers who know a bargain are buying, even with the fuel surcharge,” another cruise travel agent confided.
His bookings are consequently doing very well, but he wonders how long it can go on. And so do I, especially as so many more ships are being built – 44 are on order through to 2012, according to the PSA – which means many more passengers are needed to fill them.
According to one senior cruise line executive, the answer is to attract more people who have never cruised. Certainly, there is little point in the cruise lines just cutting prices so that existing cruisers move from one line to another in search of a bargain.
But 44 new ships means a lot of new cruisers are needed, especially when the line-up of vessels includes several that hold in excess of 4,000 passengers.
An unscientific poll on Swan Hellenic’s Minerva, on which I am cruising this week, suggests that some passengers are concerned about the cost of cruising – and these are the classic cruisers that the lines are depending on – having been hit with Swan’s swingeing fuel supplement of £14 per person per head (although many objected to it more on principle than cost).
“They’ve got you over a barrel,” one moaned. She had booked her cruise when the supplement was announced so had no choice but to pay up.
Another cruiser pointed out that the supplement was actually nothing compared to the cost of the cruise, but just objected to paying it. Will he be booking another cruise then? Like so many others this year, he was undecided.