RCI sees dip in long haul demand

RCI sees dip in long haul demand
By admin

Royal Caribbean has admitted to a drop in the number of North American passengers aboard its Australian cruises this season due to economic unease across the Pacific, but insisted rising local numbers have made up the shortfall.

Commercial manager Adam Armstrong confirmed passenger numbers from North America had been below initial expectations as consumers in the US and Canada became more cautious about spending their money.

But he said the cruise line had prepared for the decline by upping its marketing efforts in the local market in recent months.

“Overall, we’re carrying more Australians than ever on our local ships,” he said. “But we’re still carrying about a quarter to a third, depending on the cruise, of our guests from overseas.”

This season has seen RCI add Voyager of the Seas to the Royal Caribbean program, and Solstice to that of Celebrity.

“Broadly speaking, we’ve booked the same load factor this week as we did this week last year so we’ve really managed to absorb that additional capacity quite nicely,” he said.

He was confident that there was sufficient demand within the Australian market to grow capacity further, but highlighted infrastructure constraints as a major obstacle.

Limited berths in Sydney, combined with substantial increases in port fees, were seeing the cruise line look beyond New South Wales for growth opportunities, Armstrong said.

He confirmed that the firm is considering ports across Australia and New Zealand with Brisbane, Melbourne, Auckland and Fremantle all in the running.

He identified Brisbane as a frontrunner, despite issues with access, due to Queensland’s importance as its second largest market.

But high costs are “not exclusive to Sydney,” Armstrong added.

“Generally Australia is one of the most expensive countries to operate in,” he said. “So adding that extra cost is always going to be a challenge, particularly if you've got advantageous pricing in other countries where you can put your ships, like Asia.”

Nonetheless, Royal Caribbean remains committed to Australia, with the cruise line becoming “increasingly successful in the market.”

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