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Cruise Ship Industry

Page history last edited by PBworks 11 years, 8 months ago

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Table of Contents:


 

Cruise

 

 

 

 

 

Cruise line

A cruise line is a company that operates cruise ships. Cruise lines have a dual character; they are partly in the transportation business, and partly in the leisure entertainment business, a duality that carries down into the ships themselves, which have both a crew headed by the ship's captain, and a hospitality staff headed by the equivalent of a hotel manager.

 

Among cruise lines, some are direct descendants of the traditional passenger shipping lines, while others were founded from the 1960s on specifically for cruising. The business is extremely volatile; the ships are massive capital expenditures with ruinous operating costs, and a slight dip in bookings can easily put a company out of business. Cruise lines frequently sell, renovate, or simply rename their ships just to keep up with travel trends.

 

A wave of failures and consolidation in the 1990s has led to many lines existing only as "brands" within larger corporations, much as a single automobile company produces several makes of cars. Brands exist partly because of repeat customer loyalty, and also to offer different levels of quality and service. For instance, Carnival Corporation owns both Carnival Cruise Lines, whose former image were vessels that had a reputation as "party ships" for younger travellers, but have become large, modern, and extremely elegant, yet still profitable, and Holland America Line, whose ships cultivate an image of classic elegance.

 

Currently the three largest cruise operators in the world are (a full list of cruise lines is provided below):

 

 

Cruise Ship NCL Jewel

 

 

Princess Cruise

 

 

 

 

Cruise ideas

 

Cruises for the mass class »

 

If you live in Europe, you must have heard of easyCruise by now, yet another low fare concept from the people that already brought cost-conscious Europeans easyJet, easyCar, easyHotel and more. With the launch of the 289-foot-long easyCruiseOne on May 6th in Nice, France, budget travelers will soon be able to invade the playgrounds of the rich and famous on one-week itineraries that allow them to embark and depart at any port along the route, provided they stay onboard for at least two nights. Targeting passengers in their 20s, 30s and 40s who have not previously considered travel on a conventional cruise, the easyCruiseOne itinerary covers St. Tropez, Cannes, Nice, Monaco, Imperia (for San Remo), Genoa and Portofino. The ship's six decks include a Caffe Ritazza, an American-style Sports Bar, and a Tapas Bar with a live DJ on some evenings. There will also be an outdoor six-person jacuzzi on deck. All food and beverage will be sold on an a la carte basis.

Cabins are available in three categories, with 72 twins, 6 quads and 4 suites. For passengers who want their cabin cleaned or bedding and towels changed during the course of their cruise, there will be an optional housekeeping charge of USD 20 (GBP 10 / EUR 15) payable on board. If easyCruise proves successful, another 4-6 ships may be added to the fleet by 2010, cruising not only the Mediterranean but possibly Caribbean and Australian waters as well.

 

Opportunities

While easyCruise's tag line "CRUISE INTO THE PLAYGROUND OF THE RICH & FAMOUS" initially conjures up fantastic images of horrified jet setters taking to their Wallies to escape the very orange easyCruiseOne, the company's vision could play out well. It capitalizes on changes in travel patterns and a predicted growth in the cruise market of 6 new million new customers in the next few years. The fact that up to 80% of all Northern American and European households have never taken a cruise, doesn't hurt either.

On a grander scale, easyCruise could change the dynamics of a somewhat conservative industry. After all, boats may have gotten better and more luxurious, but the product itself has shown remarkably little innovation, and remains geared toward a run-of-the-mill audience, sustaining a fairly un-cool image of what could be a really fun or hip way to spend a part or all of one's holiday. Naturally, easyGroup's low fare airline division easyJet will also benefit from flying aspiring cruise passengers to Mediterranean ports. With tourists going on short breaks non-stop and year-round, adding a few nights on a cruise ship should appeal. Other cruise companies to follow? And on a grander scale: which industry will succumb to the low fare revolution next?

 

 

 

 

 

Cruise Ship

 

A cruise ship or a cruise liner is a passenger ship used for pleasure voyages, where the voyage itself and the ship's amenities are considered an essential part of the experience. Cruising has become a major part of the tourism industry, with millions of passengers each year as of 2006. The industry's rapid growth has seen nine or more newly built ships catering to a North American clientele added every year since 2001, as well as others servicing European clientele. Smaller markets such as the Asia-Pacific region are generally serviced by older tonnage displaced by new ships introduced into the high growth areas.

 

Cruise ships operate on a mostly set roundabout courses, returning with their passengers to their originating port. In contrast, ocean liners do "line voyages" in open seas, are strongly built to withstand the rigors of transoceanic voyages, and typically ferry passengers from one point to another, rather than on round trips. Some liners also engage in longer trips which may not lead back to the same port for many months.

 

Organization

Present-day cruise ships are organized much like floating hotels, with a complete "hospitality staff" in addition to the usual ship's crew. It is not uncommon for the most luxurious ships to have more crew and staff than passengers.

 

As with any vessel, adequate provisioning is crucial, especially on a cruise ship serving several thousand meals at each seating. Passengers and crew on the Royal Caribbean International ship Mariner of the Seas consume 20,000 pounds (over 9,000kg's / nine tonnes) of beef, 28,000 eggs, 8,000 gallons (over 30,000 litres) of ice cream, and 18,000 slices of pizza in a week.

 

Many older cruise ships have had multiple owners over their lifetimes. Since each cruise line has its own livery and often a naming theme (for instance, ships of the Holland America Line have names ending in "-dam", e.g. MS Statendam, and Royal Caribbean's ships' names all end with "of the Seas"), e.g. MS Freedom of the Seas, it is usual for the transfer of ownership to entail a refitting and a name change. Some ships have had a dozen or more identities.

 

Cruise ships and former liners often find employment in applications other than those for which they were built. A shortage of hotel accommodation for the 2004 Summer Olympics led to a plan to moor a number of cruise ships in Athens to provide tourist accommodation. On September 1, 2005, FEMA contracted three Carnival Cruise Lines vessels to house Hurricane Katrina evacuees.

 

 

 

 

 

Supporting Industries

 

Spa Operators (on -ship)

STEINER LEISURE LIMITED (STNR)

The spa services provider for 131 of the largest cruise ships. CAPS Rating: A provider of spa services. Creates a relaxing and therapeutic environment, also develop and market premium quality beauty products, which are sold at their facilities and at third party retail outlets.

 

Industry dynamics still work in the company's favor. Cruise lines like Carnival (NYSE: CCL), NCL, and Royal Caribbean (NYSE: RCL) continue to add new, bigger ships. Overcapacity may bring on fare-war headaches for the cruise ships, but Steiner doesn't have to discount its treatments as it pampers a wider audience. Steiner works out of 130 of the largest cruise ships, and that number will continue to grow. Steiner also runs 54 resort spas for partner hoteliers like Hilton (NYSE: HLT) and Marriott (NYSE: MAR). This is a much smaller business for Steiner -- with more landlubber rivals -- but it's there in case cruising falls out of favor.

 

In that sense, the one number that concerns me is that the daily revenue per staff member dipped during the quarter. It wasn't by much --- down from $450 to $443 -- but it's the first time that I recall seeing that number clock in lower than the year before. This is a seasonally sleepy period. Revenue per staff still came in higher for all of 2006 than it did in 2005. I would keep watching that, though.

 

There was one more rough current in last night's report. Revenue shot up 20.7% higher -- and that's good -- but operating profits rose by just 5.7%. In other words, operating margins contracted during the period. It was a challenging period for some of the cruise lines, so one shouldn't expect perfection out of Steiner. To be safe, I would still keep an eye on how operating margins and daily revenue per staff figures stack up over the next few quarters.

 

With 126 cruise ships and 55 land-based spas, Steiner continues to grow its reach. Cruise operators keep adding bigger ships to their fleets, and Steiner is there to collect the extra passengers without having to pay the shipyard or deal with the fluctuating fares. Those welcome traits have made Steiner a solid recommendation in the Rule Breakers newsletter service. The shares have gone on to double since being singled out in the fall of 2004.

 

 

 

 

for latest quotes: http://caps.fool.com/Ticker.aspx?source=icaedilnk9950012&ticker=STNR

 

 

 

 

 

Shipyards

The market for cruise ships is dominated by three European companies:

 

1. Aker Yards of Norway with two shipyards: Aker Finnyards (ex Kvaerner Masa-Yards/Wärtsilä) in Finland. Aker Yards France (ex Chantiers de l'Atlantique) in France.

2. Fincantieri of Italy.

3. Meyer Werft of Germany.

Very few cruise ships have been built by other shipyards; many of these exceptions are old ocean liners, many of them still operating under steam power. Only one ship built in the USA, the SS The Emerald is still sailing the Seven Seas.

 

 

 

 

 

 

 

 

 

Name , Headquarters

A'rosa [Europe]

NCL USA USA

AIDA Cruises Europe - part of Carnival

American Cruise Lines USA

American Canadian Caribbean Line USA

Anedin Line Europe

Anek Lines Europe

Bora Bora Cruises USA

Birka Line Europe

Carnival Cruise Lines USA - part of Carnival

Celebrity Cruises Europe

Clipper Cruise Line USA

Costa Cruises Europe - part of Carnival

Cruise West USA

Crystal Cruises USA

Cunard Line USA/Europe - part of Carnival

Custom Alaska Cruises USA

DFDS Seaways Europe

Disney Cruise Line USA

EasyCruise Europe

First European Cruises Europe

Fred. Olsen Cruise Lines Europe

Hapag- Lloyd Cruises

Holland America Line USA - part of Carnival

Hurtigruten Group Europe

Imperial Majesty USA

Kristina Cruises Europe

Minoan Lines Europe

Holland America Line USA

Louis Hellenic Cruise Lines Europe

MSC Italian Cruises

Norwegian USA Line

Norwegian Capricorn Line Australia

NCL Norwegian Cruise Line USA

Ocean Village Europe

Oceania Cruises USA

Olivia Cruises USA

Orient Lines USA

Orion Expedition Cruises Australia

P & O Cruises Europe - part of Carnival

P & O Irish Ferries Europe

Polar Star Expeditions USA

Premier Cruise Line USA

Princess Cruises USA - part of Carnival

Regent Seven Seas Cruises USA

Royal Caribbean International USA

Royal Olympia Cruises

Silversea Cruises

Seabourn Cruise Line USA - part of Carnival

SeaFrance Europe

Silja Line Europe

Stena Line Europe

Star Cruises Asia

Swan Hellenic Europe - part of Carnival

Tallink Europe

Travel Dynamics International USA

Viking Line Europe

Windjammer Barefoot Cruises USA

Windstar Cruises USA - part of Carnival

 

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