Bad news for cruise fans: The days of sailing on incomplete ships are coming to an end.
Executives at some of the world’s biggest cruise companies have said in recent weeks that nearly all of their ships will be back in service by the middle of next year, the first time since the COVID-19 pandemic- 19 starts.
For instance, Norwegian Cruise Line Holdings’ president and chief executive officer, Frank Del Rio, told Wall Street analysts last week that average capacity across the company’s 29 ships would increase steadily over six months. come and reach 100% in the summer.
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In fact, he suggests fleet occupancy could reach more than 100% in the summer — something that can happen when more than two people are in a cabin.
The occupancy rate on Norwegian Cruise Line Holdings’ ships was around 82% in the three months ended October 31 — up from 65% in the three months before. In both cases, that’s much lower than normal.
The company owns three cruise brands: Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruise.
“We expect the load factors to continue to improve sequentially to mid-to-high 80% in the [current quarter] … and a steady occupancy rate is expected to continue until we are above 100% historically starting in the second quarter of 2023,” Del Rio said on a conference call to discuss the company’s third-quarter earnings.
Del Rio’s comments come just days after Royal Caribbean Group chief financial officer Naftali Holtz told Wall Street analysts the company expected occupancy to return to historic levels. at corporate travel brands in the spring of 2023.
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Royal Caribbean Group is the parent company of Royal Caribbean, Famous people and silver sea yachtand it is also part owner of the German TUI Cruises and Hapag-Lloyd Cruises routes.
Holtz said Royal Caribbean Group ships ended the third quarter with a occupancy rate of 96%, up significantly from the 82% occupancy rate in the second quarter but still below normal.
Royal Caribbean Group vessels usually set sail at more than 100% capacity.
The world’s largest cruise company, Carnival Corporation, is also predicting a return of 100% vessel occupancy by summer 2023. The company has reported an 84% occupancy rate for the summer months including July, August and September — up from 69% in the previous three months.
Carnival Group owns nine yacht brands, including Festival cruise line, Princess Cruise, Netherlands USA and seaport.
In normal years, most major cruise lines typically report occupancy rates of 100% or more for their vessels. The business model adopted by most major industries involves pricing and investing in marketing at such a high occupancy rate, as the economics of cruise ships perform well. when they are fully operational.
However, fill levels on cruise lines have plummeted after the COVID-19 pandemic began in 2020. At first, cruise lines were completely idle and when they started back up, sometimes sometimes. they set sail with less than half a full cabin; Cruisers return slowly, and cruise lines struggle to get people to return — even at unusually low prices.
Occupancy at some linearity through early 2022 is less than 50%.
While this is a dire situation for cruise lines, which report massive financial losses in 2021 and for much of this year, it’s a boon for cruise lines looking to experience the best. The train has a much smaller number of passengers than usual.
In 2021, a number of cruise ships will set sail with less than 30% of the usual number of passengers while still operating with a normal crew; this leads to extraordinary service levels in some cases.
Occupancy rates on cruise lines have increased throughout 2022 and have returned to normal in some areas, for some routes.
The Royal Caribbean Group, for instance, reported earlier this month that their fill on Caribbean cruises is close to 105%, which is within the normal range. The company said the trip occupancy rate in Alaska for the past quarter was about 96%, below normal.
Royal Caribbean Group reported occupancy on European cruises of just under 90% in the third quarter.
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