Report on the Development of Cruise Industry in China (2019) [1st ed.] 9789811546600, 9789811546617

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Hong Wang Editor

Report on the Development of Cruise Industry in China (2019)

Report on the Development of Cruise Industry in China (2019)

Hong Wang Editor

Report on the Development of Cruise Industry in China (2019)

123

Editor Hong Wang Shanghai International Cruise Business Institute Shanghai University of Engineering Science Shanghai, China

ISBN 978-981-15-4660-0 ISBN 978-981-15-4661-7 https://doi.org/10.1007/978-981-15-4661-7

(eBook)

Jointly published with Social Sciences Academic Press The print edition is not for sale in China (Mainland). Customers from China (Mainland) please order the print book from: Social Sciences Academic Press. © Social Sciences Academic Press 2020 This work is subject to copyright. All rights are reserved by the Publishers, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publishers, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publishers nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publishers remain neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Singapore Pte Ltd. The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721, Singapore

Editorial Board

Advisor: Yongchang Qian Editor-in-chief: Hong Wang Associate Editors: Xinliang Ye, Jianyong Shi, Ping Su, Weihang Zheng, Younong Wang, Ling Qiu and Guojian Zhu Editorial Board: (listed in the order of the number of strokes in their surnames) Yichuan Wang, Jing Wang, Younong Wang, Qiang Ye, Xinliang Ye, Jianyong Shi, Guojian Zhu, Ruiqin Jiang, Peixing Xu, Ping Su, Mingyuan Wu, Zhong Wu, Ling Qiu, Hong Wang, Shaojun Shen, Jianming Zhang, Lu Zhang, Jigang Lu, Xinde Chen, Weihang Zheng, Yong Meng, Yongjun Xia, Huiquan Gu, and Shuguang Lei

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Compilers of the Book

General Report (Listed in the order of appearance) Hong Wang, Jianyong Shi, Junqing Mei, Ping Su, Xinliang Ye, Younong Wang Special Topic Jianyong Shi, Ling Qiu, Linkai Qi, Hong Wang, Ruiqin Jiang, Junqing Mei Wenyu Hou, Fushun Lin, Ishihara Hiroshi Industry Development Chapter Linkai Qi, Ling Qiu, Qiuxia Dong, Ling Sun, Shuguang Lei, Junqing Mei, Yanling Huang Policy Suggestions You Nong Wang, Yan Hui Gao, Jun Qing Mei, Zhanglin Lin, Ruihong Sun, Qingqing Zhang, Huiyu Hong, Yuanqin He, Xinliang Ye, Jingjun Gu, Guodong Yan, Jinlin Zhao, Jing Shen, Wenlu Shen, and Wei Wang

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Foreword

2019 is the 70th anniversary of the founding of New China, the key year for building a moderately prosperous society in all respects, the sprint year for implementing the 13th Five-Year Plan, and the first year for launching the whole industry chain of China’s cruise economy substantively. Under the era background of further departure of reform and opening up, China’s cruise economy has entered a critical period of transition from “high-speed growth” to “high-quality and high-grade development” and a key stage of initiating a China’s era for international cruise economy. The global cruise tourism market size keeps a steady growth. The Cruise Lines International Association (CLIA) is positively optimistic about the development prospects of the cruise tourism market. It is predicted that the global cruise passenger throughput will reach 30 million in 2019 and 37.6 million in 2025, indicating that the international cruise market enjoys good projects and potential. Asia-Pacific is becoming the most promising important part of the global cruise market. Seen from the homeport cruise ships operating in the Chinese market, there were 12 ships in 2015, 18 ones in both 2016 and 2017, 16 ones in 2018, and 14 ones in 2019. Although the Chinese market has temporarily fallen back in quantity in 2019, the quality is still continuing to improve from the perspective of the whole market. In the next few years, China will welcome the latest and best international cruise ships one after another. “Spectrum of the Seas”, the first cruise ship of the Quantum Ultra Class of Royal Caribbean Cruises accessed the Chinese market on June 3, 2019, with the latest technology in the cruise industry, serving as the largest and most expensive cruise ship in Asia. It is planned to deploy “Oasis V”, the world’s largest cruise ship with a tonnage of 230,000, in the Chinese market in 2021. “Venezia”, the first Vista class cruise ship tailored for the Chinese market by Costa Crociere S.p.A also accessed the Chinese market in 2019, and its sister ship “Costa Frienze” will enter China in 2020. MSC Bellissima, the new flagship cruise ship, will also present itself in China in the spring of 2020. The two “world class” cruise ships with a tonnage of 204,000 and a maximum passenger capacity of 9,500 newly built by Genting Cruise Lines will be deployed in Shanghai Home Port in 2021. While some cruise lines are adjusting their transport capacity, more international cruise lines will deploy their latest and best cruise ships in the Chinese ix

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Foreword

market, which is the most powerful proof of market confidence. Over the past decade, China’s coastal cities have invested heavily in cruise ports. Shanghai, Dalian, Tianjin, Qingdao, Zhoushan, Xiamen, Sanya, Guangzhou and Shenzhen have built cruise ports one after another. There are also about 20 seaports with cruise reception capacity in Zhejiang, Fujian and Shandong. All these lay a good foundation for the development of cruise tourism. With the new development in the new era, people’s spending power has increased, which makes them more demand for a better life, and their demand for leisure tourism is also moving to a higher level. In this case, cruise tourism is definitely an important choice. China has maintained its position as the world’s largest source of outbound tourism for many years and kept a steady growth. This also provides a good customer base for the development of China’s cruise market. In the past two years, China’s cruise economy has achieved a high-quality development and stepped into a key stage of initiating a China’s era for international cruise economy. China has introduced many policies on cruise ships from the central government to local governments. 10 national sectors including the Ministry of Transport and the Ministry of Culture and Tourism jointly issued the Several Opinions on Promoting the Development of Cruise Economy in China. Shanghai Municipal People’s Government issued the Several Opinions on Promoting the Deepening Development of the Cruise Economy in Shanghai. The People’s Government of Fujian Province promulgated the Implementation Plan for Promoting the Development of Cruise Economy. The People’s Government of Guangzhou Municipality promulgated the Several Measures for Accelerating the Development of Guangzhou International Cruise Industry. All these have given a strong and powerful guidance and support for the high-quality development of cruise economy. Both the policy environment and market environment for the development of cruise economy have improved significantly. With the implementation of relevant policies on cruise economy step by step, the policy dividend will be further released, which will certainly propel China’s cruise economy to a better development. The cruise industry has entered the second decade of development in China, with both opportunities and challenges. The popularization of cruise culture is still sluggish. Many tourists still attach great importance to tourism ashore. They overvalue the cost performance of cruise products rather than the essential attributes of cruise ship itself for leisure and vacation. There is an urgent need to enhance tourists’ awareness of cruise ships, strengthen the development momentum of the cruise market, and cultivate China’s pursuit of a new lifestyle of cruise ships. To effectively solve the problem of independent development and low interaction between multi-regional cruise ports in China, the “multi-port call” policy has been implemented. However, no breakthroughs have been made so far, causing bottlenecks in the development of multi-home-port and mutual-home-port routes, affecting the collaboration effect. There is still no major breakthrough in the design, manufacturing and maintenance of cruise ships in the upstream and midstream of the industry chain. The development of cruise lines headquarters economy and cruise industry chain is still in its infancy, requiring a greater strategic innovation.

Foreword

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The local cruise industry develops slowly and there is a lack of strong local cruise fleet. The cluster effect of industry factors is low. No mature industrial system has been formed for the design and construction of cruise ships. No independent intellectual property rights of cruise repair and construction have been mastered. And regional radiation and impetus effect are limited. To have a better study of the development of China’s cruise economy and a systematic and in-depth research on the future trend of China’s cruise market, Shanghai University of Engineering Science and Shanghai International Cruise Business Institute initiated the compilation of the report, which is an annual research report written based on the latest development of international cruise economy. It has become the most authoritative research works on the cruise industry in China. As the trend of China’s cruise economic development, the report has attracted much attention and positive evaluation from the academic circles and the industry, becoming an important basis for the government and cruise lines to formulate the cruise industry development plan and strategy. I would like to express my sincere gratitude and admiration for the achievements it made. Report on the Development of Cruise Industry in China (2019) focuses more on the study of cruise economy industry chain based on the previous editions and the latest trend of China’s cruise economy, includes Special Topic: Cruise Economic Reform and Innovation in the New Era, explores Asia cruise economic prosperity index, China’s cruise economy whole-industry-chain strategy in the new era, the development of cruise destinations in the context of the Yangtze River Delta integration, which provides a good reference for better promoting the high-quality development of China’s cruise market. I hereby express deep gratitude to the editors and workers, who have long been contributing to the Report on the Development of Cruise Industry in China (2019), as well as heartfelt thanks to all the friends who have cared for and supported the development of China’s cruise economy. Hopefully, my colleagues will make persistent efforts to have greater innovations, in order to better realize the high-quality development of China’s whole cruise industry chain and explore the Chinese path and model. I am expecting to see that more and more people with vision join the development tide of whole industry chain of China’s cruise economy to make unremitting efforts to better meet the needs of the people for a better life and contribute to building a moderately prosperous society in all respects and realizing the great rejuvenation of the Chinese nation. Beijing, China September 2019

Yongchang QIAN Former minister of the Ministry of Transport, Chairman of China Communications and Transportation Association

Introduction to the Main Editor

Hong Wang, Ph.D. in Business at Shanghai Jiao Tong University, Postdoctoral Fellow in Applied Economics at Fudan University, current Secretary of Baoshan District Committee of the CPC, and a researcher of Shanghai International Cruise Business Institute. As a doctoral advisor and professor of Shanghai Jiao Tong University, she also enjoys special allowances of the State Council and is one of the members of the 10th, 11th, 12th, and 14th Shanghai Municipal People’s Congress and a national candidate for “the New Century National Hundred Thousand-and-Ten Thousand Talents Project”. Professor Hong Wang has been serving as the Vice Chairman of the Professional Education Steering Committee on Business Administration of Colleges and Universities, the Ministry of Education for a long time and she once served as the Vice Chairman of the Professional Education Steering Committee on Management Science and Engineering of Colleges and Universities, the Ministry of Education. At present, Professor Hong Wang is one of the scholars listed in the New Century Talent Support Program of the Ministry of Education, Shanghai Dawn (Shughuan) Program and Shanghai Dawn (Shughuan) Tracking Program, honored as the leading talent and excellent academic leader of Shanghai Municipality. Professor Hong Wang initiatively interfaces with the general trend of development of the international cruise industry and has innovatively extended the content of teaching of the discipline of “tourism management”. She is the first person in China to start the undergraduate and graduate programs for “cruise economy” and serves as the discipline leader. She led the “Program of Innovative Practices for Cultivating Badly-Needed Talents of the International Cruise Industry on the Basis of Government Support, Industry Development, Talent Cultivation, Scientific Research and User Application”, and won the second prize for 2014 National Teaching Achievements and the outstanding award for Shanghai Teaching Achievements. Professor Hong Wang emphasizes the direct transformation of research achievements into productivity and application. Some of the achievements have been converted into the basis for decision-making by cruise companies and the government. She has successively headed 6 projects including National Social Science Foundation, National Soft Science projects, major projects of National xiii

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Introduction to the Main Editor

Development and Reform Commission (NDRC) and over 30 provincial and ministerial research projects, published over 70 monographs and essays, many of which have been included by EI and ISTP. More than 30 of her research achievements have been successively awarded the first prize for Shanghai Governmental Decision-Making and Consultation Research Achievements, the second prize for Shanghai Science and Technology Progress Award, the excellent award of Shanghai Deng Xiaoping Theory Research and Propaganda, the excellent award of Shanghai Philosophy and Social Science Community Discussion, the first prize for Shanghai Teaching Achievements, and the first prize for Shanghai Education and Scientific Research Achievements and other provincial and ministerial awards. Professor Hong Wang once served as the Executive Committee Member of the All-China Federation of Trade Union, Representative of the All-China Women’s Federation, President of Shanghai University of Engineering Science, Vice-Chairman of Shanghai Federation of Trade Unions, Vice-Chairman of Shanghai Commercial Enterprise Management Association, Vice-Chairman of Shanghai Creative Industry Association, Vice-Chairman of Shanghai Science and Art Society, and Director of Shanghai International Cruise Economic Research Center, etc.

Contents

Part I 1

2

3

General Report

Research on Developments in Global Cruise Industry in 2018–2019: Size Beyond Expectation, Industry Reconstruction, and Enhanced Economic Contributions . . . . . . . . . . . . . . . . . . . . . Hong Wang, Jianyong Shi, and Junqing Mei Research on the Developments in China’s Cruise Industry in 2018–2019: The Development of Whole Industry Chain of the Cruise Economy Has Substantially Taken Off . . . . . . . . . . . Hong Wang, Ping Su, Xinliang Ye, and Junqing Mei Top 10 Hot Topics in the Development of China’s Cruise Industry in 2018–2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Xinliang Ye, Hong Wang, Jianyong Shi, and Younong Wang

Part II

3

29

81

Special Articles on Cruise Economic Reform and Innovation in the New Era

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Research on Cruise Economy Prosperity Index of Asia . . . . . . . . . 103 Jianyong Shi, Ling Qiu, and Linkai Qi

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Research on Full Industry Chain Strategy of China’s Cruise Economy in the New Era . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117 Hong Wang, Ruiqin Jiang, and Junqing Mei

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Research on the Development of Cruise Tourism Under the Background of Tourism Integration in the Yangtze River Delta . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131 Wenyu Hou

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Contents

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Environmental Change of Cruise Industry in Northeast Asia and Challenges Facing the Korean Cruise Industry—Development Strategy Centered on North Busan Port . . . . . . . . . . . . . . . . . . . . . 143 Fushun Lin

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Developments in Japan’s Cruise Industry in 2018–2019: Efforts Toincrease Cruise Passengers Visiting Japan to 5 Million by 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 Ishihara Hiroshi

Part III 9

The Cruise Industry

A Study on the Globalization Strategies of China’s Cruise Tourism Market Under the “Belt and Road” Initiative . . . . . . . . . 171 Ping Su and Linkai Qi

10 Research on Comprehensive Evaluation and Improvement Approaches of Cruise Industry Performance . . . . . . . . . . . . . . . . . 187 Ling Qiu and Qiuxia Dong 11 A Study on the Strategies for the Diversified Development of Cruise Products and Routes in China’s Home Port . . . . . . . . . . 199 Ling Sun 12 A Study on the Development Path of Supporting Industrial Park of Cruise Shipbuilding and Repair Industry in Shanghai . . . . . . . . 207 Shuguang Lei and Junqing Mei 13 A Study on Consumer Perception of International Cruise Travel in China-Based on Web Text Data Analysis . . . . . . . . . . . . 217 YanLing Huang Part IV

Policy Suggestions

14 A Study on Evaluation of Supportive Policy System of China’s Cruise Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 239 You Nong Wang, Yan Hui Gao, and Jun Qing Mei 15 A Study on the Admission Mechanism of International Cruises in China’s Home Ports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259 Zhanglin Lin 16 Research on Environmental Monitoring and Supervision System in Cruise Port Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 279 Ruihong Sun, Qingqing Zhang, Huiyu Hong, Yuanqin He, and Xinliang Ye

Contents

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17 Strategic Research on Profoundly Promoting Single Window in Cruise Ports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293 Jingjun Gu 18 Research on Optimal Route of Material Distribution Center of Asia Pacific Cruise Ships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 303 Guodong Yan, Jinlin Zhao, Jing Shen, Wenlu Shen, and Wei Wang

Part I

General Report

Chapter 1

Research on Developments in Global Cruise Industry in 2018–2019: Size Beyond Expectation, Industry Reconstruction, and Enhanced Economic Contributions Hong Wang, Jianyong Shi, and Junqing Mei Abstract In 2019, despite the significant increase in the risks and uncertainties of the world economy, the global cruise tourism market keeps a steady growth. According to the forecast of the CLIA, the global cruise passenger throughput is expected to reach 30 million in 2019, up 5.19% year-on-year. This will be the first time for passenger throughput to exceed 30 million and it is expected to reach 37.6 million in 2025, indicating that the international cruise market enjoys good projects and potential. North America is still the world’s largest cruise market. In 2018, its passenger throughput reached 14.2 million, up 9% year-on-year. The cruise passenger throughput in Caribbean reached 11.3 million, up 6% year-on-year, continuing to be the world’s No. 1 cruise destination. The cruise passenger throughput in Alaska exceeded 1 million, up 13% year-on-year. The cruise passenger throughput in EuroMediterranean Area exceeded 4 million, up 8% year-on-year. Asia has become the fastest growing region in the global economy, providing a more solid foundation and development potential for the cruise economy. In 2018, the cruise passenger throughput in Asia reached 4.2 million, up 5% year-on-year, and there is a large room for growth in the future. It is becoming the most promising important part of the global cruise market. There is an increasing demand for cruise construction market. By 2027, there will be 114 new cruise ships ordered worldwide, with 247,600 new seats available, most of which are cruise ships with a tonnage above 130,000. As China become more engaged in the whole industry chain of cruise economy such as cruise design and construction, cruise operation and cruise industry supporting services, the world cruise industry is gradually adjusting its development pattern to H. Wang (B) CPC Baoshan District Committee, Shanghai, China e-mail: [email protected] J. Shi Party Committee of Shanghai University of Engineering Science, Shanghai, China e-mail: [email protected] J. Mei Shanghai Wusongkou Development Co., Ltd., Shanghai, China e-mail: [email protected] © Social Sciences Academic Press 2020 H. Wang (ed.), Report on the Development of Cruise Industry in China (2019), https://doi.org/10.1007/978-981-15-4661-7_1

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further boost the sustained prosperity of the global cruise economy and enhance the status and influence of Asia-Pacific in the global cruise market. Keywords Industry · Pattern · Cruise economy · Industry chain · Development potential

1 Analysis on the Developing Situation of Global Cruise Market 1.1 The Global Cruise Tourism Market Grows Faster than Expected The cruise economy features large scale, stable growth and strong clustering. It has gradually become a featured industry for coastal port cities to transform and upgrade their industries and improve their urban functions, and a new momentum to promote the development of the marine economy. According to the statistics of the CLIA, the global cruise passenger throughput reached 28.5 million in 2018, up 7% yearon-year, higher than 28.2 million originally predicted. It grows faster than expected. North America is still the largest cruise market in the world, with a cruise passenger throughput reaching 14.2 million, up 9% year-on-year. Among which, Caribbean that boasts the most coastal countries has been the most popular cruise destination in the world with its excellent port resources, abundant tourism resources and favorable climate conditions. It attracts many cruise brands, a wealth of cruise routes and a wide range of tourists. Its cruise passenger throughput reached 11.3 million in 2018, up 6% year-on-year, maintaining its absolute dominant position as the No. 1 cruise destination in the world. The cruise passenger throughput in Alaska exceeded 1 million, up 13% year-on-year. The cruise passenger throughout in Asia increased by 5%, and then to 4.2 million, and that in Mediterranean increased by 8% to over 4 million (Fig. 1). The CLIA is positively optimistic about the development prospects of the cruise tourism market. It is predicted that the global cruise passenger throughput will reach 30 million in 2019 and 37.6 million in 2025, indicating that the international cruise market enjoys good projects and potential. The global cruise market is mainly concentrated in Caribbean, Asia-Pacific, Mediterranean, Northern and Western Europe, Australia and Alaska, which account for 85% of the total. Caribbean is still the most concentrated area of the global cruise market. Its passenger throughput accounts for nearly 40% of the total, reaching 38.4% in 2018. The development of Asia-Pacific economy provides a good consumer base for the development of cruise tourism in Asia-Pacific, with a remarkable space for growth. Its share of passenger throughput in global cruise market has increased from 8% in 2013 to 15.1% in 2018, making it the world’s second largest cruise market after Caribbean (Fig. 2).

1 Research on Developments in Global Cruise Industry in 2018–2019 …

Global Cruise Passenger Throughput

5

Growth rate 



Other Regions

South America

Canary Islands

West Coast

Alaska

Australia

Northern and

Western Europe

The Mediterranean

Asia-Pacific Region

Caribbean

Fig. 1 Global cruise passenger throughput and growth rate in 2009–2019. Data source Cruise Lines International Association

Fig. 2 Distribution of global cruise passenger market. Data source Cruise Lines International Association

1.2 The Size of Global Cruise Operation Fleet Expands Significantly At present, Carnival Corporation, Royal Caribbean Cruises, Norwegian Cruise Line, MSC Cruises, and Genting Cruise Lines are the top five cruise operators in the world.

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Table 1 Overview of the world’s top five cruise lines in 2018 (data updated to early 2019) Cruise companies

Headquarter base

Founding time

Number of cruise ships

Number of brands

Carnival Corporation

Miami, the U.S.

In 1972

105

9

Royal Caribbean Cruise Ship

Miami, the U.S.

In 1968

52

6

Norwegian Cruise Line

Miami, the U.S.

In 1966

26

3

MSC Cruises

Naples

In 1987

15

1

Genting Cruise Lines

HKSAR, China

In 1993

9

3

Data source Cruise Lines International Association

In terms of the world cruise market structure, the cruise lines giants dominate the market. The giant cruise lines with the fleet size and strength of among the top three in the world cruise industry occupy more than 80% of the world cruise market shares. The fleet size is quite large. All the cruise lines except MSC Cruises adopt multi-brand strategy. They operate various cruise brands and put different levels of cruise brands into different regions. In 2018, there were 342 cruise ships operating worldwide, with a total of 569,000 lower berth seats. Among which, Carnival Corporation, the largest cruise operator in the world, had the most passenger seats, with a market share of 43%. Royal Caribbean Cruises accounted for 27%, Norwegian Cruise Line for 9%, and MSC Cruises for 8%. However, with the continuous increase of new cruise ships in MSC Cruises, MSC Cruises is expected to rise to the third largest cruise operator in the world, and its international influence and status will be significantly enhanced (Table 1). Carnival Corporation has nine cruise brands, a total of 105 cruise ships, with 240,400 berths. Among which, Carnival Cruise Line has the most fleets, up to 26, with 69,890 berths. It mainly operates in the North American market. Costa Crociere S.p.A that pursues hospitable Italian service has 14 cruise ships, with 34,874 berths. Princess Cruises has 17 cruise ships, with 45,180 berths. Aida Cruises has 13 cruise ships, with 30,212 berths. Holland America Line, with a history of 140 years, has 15 cruise ships, with 26,022 berths. P&O Cruises, the oldest cruise lines in the world, has 7 cruise ships, with 17,311 berths. P&O Cruises Australia has 5 cruise ships, with 7,710 berths. Cunard Line has 3 cruise ships, with 6,712 berths. The luxury cruise brand Seabourn Cruises Line has 5 cruise ships, with 2,588 berths. Royal Caribbean Cruises currently has 4 cruise brands including 52 cruise ships, with 132,000 berths. Among which, Royal Caribbean International has 25 cruise ships, with 80,690 berths. Celebrity Cruises at higher level has 13 cruise ships. TUI Cruises, a joint venture with TUI Group, has 6 cruise ships. While Skysea Cruise Line, a joint venture with Ctrip Group, closed in September 2018. Norwegian Cruise Line owns three cruise brands including 26 cruise ships, with 54,800 berths. Among which, Norwegian Cruise Line has 16 cruise ships. Oceania Cruises, a young brand

1 Research on Developments in Global Cruise Industry in 2018–2019 …

7

founded in 2002, has 6 cruise ships, with 5,256 berths. The luxury cruise line Regent Seven Seas Cruises has 4 cruise ships, with 2,660 berths. MSC Cruises, the world’s largest private cruise line, is the only single-brand operator among the top five cruise lines in the world. It owns 15 cruise ships, with 44,600 berths. Genting Hong Kong Limited, a local cruise lines in Asia, owns 9 cruise ships, with 15,400 berths. Among which, Star Cruises has 4 cruise ships, with 6,505 berths. Dream Cruises, the first local luxury cruise line in Asia, has 2 large cruise ships, i.e. “Genting Dream” and “World Dream”, with 6,800 berths. The luxury line Crystal Cruises has 3 cruise ships, with 2,104 berths (Table 2). On February 1, 2019, the construction of the second cruise ship of the Quantum Ultra Class of Royal Caribbean International officially kicked off at Meyer Werft GmbH in Papenburg, Germany. This is the 27th cruise ship under Royal Caribbean Cruises and was named “Odyssey of the Seas”. “Odyssey of the Seas” is scheduled to set sail in the United States in the fall of 2020. In early 2019, Fincantieri S.p.A officially delivered “Seven Seas Splendor”, a 55,000-GT cruise ship, to Regent Seven Seas Cruises after “Seven Seas Explorer”. Another cruise ship will be delivered in 2023. Oceania Cruises also signed a contract with Fincantieri S.p.A for the construction of two Allura class cruise ships with a passenger capacity of 1,200. The deal exceeded USD 1 billion, and the two cruise ships will be delivered in 2022 and 2025 respectively. Fincantieri S.p.A has delivered “Viking Jupiter”, a 47,000-GT cruise ship with a passenger capacity of 930, to Viking Cruises. It will gradually deliver 10 new cruise ships of the same specifications to Viking Cruises, which will expand Viking Cruises’ fleet size. In January 2019, Quark Expeditions, which specializes in polar exploration, held a steel cutting ceremony for a new cruise ship at Brodosplit, the largest shipyard in Croatia. The new polar expedition cruise ship will be built and delivered in 2020. This new cruise ship will be 128 m long, with a gross tonnage of 13,500 and a maximum passenger capacity of 200. Carnival Corporation will usher in two larger cruise ships with a gross tonnage of 180,000 and a passenger capacity of 5,200, which will be unveiled in 2020 and 2022. On November 21, 2018, “Celebrity Edge”, the latest cruise ship of Celebrity Cruises, launched its maiden voyage in Fort Lauderdale, USA. It mainly operates the Caribbean cruise routes. In February 2019, Fincantieri S.p.A officially delivered to Viking Cruises its sixth cruise ship, Viking Jupiter. Viking Jupiter, with a gross tonnage of 47,800 and a passenger capacity of 930, will be put into operation on the South American route from Buenos Aires to Santiago. In addition to large ocean cruise ships, the expedition cruise fleet is also expanding. There will be 12 expedition cruise ships built and put into operation in 2019, further expanding the market size of expedition cruise ships. Those cruise lines have deployed their business in North America where there is the largest cruise market in the world, including Carnival Corporation & PLC, Royal Caribbean Cruises, Norwegian Cruise Line, and Crystal Cruises under Genting Hong Kong Limited. Among which, Carnival Corporation & PLC has deployed 57 cruise ships, with the largest market share, reaching 43.8%. It boasts 128,300 berths and a cruise passenger throughput of 6.3983 million, with a market share of 43.8%. Royal Caribbean Cruises has deployed 38 cruise ships, with 96,800 berths. Its cruise passenger throughput has reached 4.3275 million, with a market share of 29.6%.

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Table 2 Fleets of world’s top five cruise brands in 2019 Carnival Corporation

Royal Caribbean Cruises

Brand

Number of cruise ships

Number of berths

Brand

Number of cruise ships

Number of berths

Carnival Cruises Lines

26

69,890

Royal Caribbean International

25

80,690

Costa Cruises

14

34,874

Celebrity Cruises

13

25,330

Princess Cruises

17

45,180

TUI Cruises

6

14,784

AIDA Cruises

13

30,212

Pullmantur Cruises

4

7358

Holland America Line

15

26,022

Azamara Club Cruises

3

2122

P&O Cruises

7

17,311

Skysea Cruise Line (closed)

1

1800

P&O Australia

5

7710

Cunard Line

3

6712

Seabourn Cruise Line

5

2588

Norwegian Cruise Line

Genting Hong Kong Limited

Brand

Number of cruise ships

Number of berths

Brand

Number of cruise ships

Number of berths

Norwegian Cruise Line

16

46,930

Star Cruises

4

6505

Oceania Cruises

6

5256

Dream Cruises

2

6800

Regent Seven Seas Cruises

4

2660

Crystal Cruises

3

2104

MSC Cruises Brand

Number of cruise ships

Number of berths

MSC Cruises

15

44,640

Data source Cruise Lines International Association

1 Research on Developments in Global Cruise Industry in 2018–2019 …

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Norwegian Cruise Line has deployed 25 cruise ships, with 50,600 berths. Its cruise passenger throughput has reached 2.2131 million, with a market share of 15.2%. Carnival Corporation & PLC, Royal Caribbean Cruises and Norwegian Cruise Line accounted for 88.6% of the total, occupying an absolute share of the North American market. Genting Cruise Lines has put its luxury cruise brand Crystal Cruises into the North American market. With 2,104 berths, it received 59,600 cruise passengers in 2018, with a market share of 0.4% (Table 3). Table 3 Major cruise brands deploying business in North American market Brand

Number of cruise ships

Passenger capacity

Passenger throughput

Market share (%)

Carnival Corporation & PLC Carnival Cruises Lines

25

67,790

4.2242 million passengers

28.9

Princess Cruises

12

31,980

1.2666 million passengers

8.9

Holland America Line

15

26,022

837,200 passengers

5.7

5

2558

72,600 passengers

0.5

Seabourn Cruise Line

Royal Caribbean Cruises Royal Caribbean International

22

62,390

3.4502 million passengers

Celebrity Cruises

13

25,330

820,400 passengers

5.6

3

2122

56,800 passengers

0.4

Azamara Club Cruises

23.6

Norwegian Cruise Line Norwegian Cruises

15

42730

1.9931 million passengers

13.7

Oceania Cruises

6

5256

144,800 passengers

1

Regent Seven Seas Cruises

4

2660

75,100 passengers

0.5

2104

59,600 passengers

0.4

Genting Hong Kong Limited Crystal Cruises

3

Data source Cruise Lines International Association

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H. Wang et al.

1.3 Global Cruise Tourism Products Continue to Innovate Boosting the innovation of cruise tourism products is an important basis to enhance market attractiveness and an important link to promote brand value. During 2020– 2021, Royal Caribbean Cruises will launch seven cruise ships remodeled by Royal Amplified modernization project with USD 1 billion in 2018, to bring a variety of exciting adventures to passengers of all ages. Based on the insights into the North China market, it works with Deyunshe to jointly offer a series of voyages themed on “Ocean of Joy, Feast for Laughter”. By integrating modern cruise facilities with traditional Chinese crosstalk culture, it provides passengers with unique and diversified entertainment experience from the perspective of localization in China. Royal Caribbean Cruises introduces Baidu WiFi Translators that integrate Baidu AI and Tuge global cloud communications technology, offering an extraordinary service experience on land and sea featuring “intelligent translation + global Internet access”. Passengers can access the Internet anytime and anywhere for real-time online intelligent translation. Oceania Cruises is planning its ultra-long voyage round the world in 2021. Its cruise ship will depart from Miami in January 9, 2021 and span three oceans and six continents in 180 days, covering 44 countries. It will call at 100 port destinations and visit more than 120 UNESCO World Heritage Sites. The total voyage will reach more than 39,000 nautical miles. Dream Cruises, a subsidiary of the Genting Cruise Lines, has launched Asia’s first all-inclusive luxury cruise experience of “Boutique Yacht in Ship”. The “MSC Meraviglia” of MSC Cruises will call at the Ocean Cay, a private island, in November 2019, allowing passengers to enjoy a pure natural beach. Hurtigruten Cruise Line is planning to open up more expedition routes for its cruise ship for polar expeditions including MS Trollfjord, MS Finnmarken, MS Spitsbergen and MS Midnatsol from 2021.

1.4 The Profitability of Global Cruise Lines Is Significantly Improved As the world cruise tourism market gets better and better, the profitability of the world’s top five cruise operators continues to improve as well. In 2018, Carnival Corporation & PLC, the world’s largest cruise operator with 41.8% of the global cruise market share, reported a total annual revenue of USD 18.88 billion, up 7.83% year-on-year, and a net profit of USD 3.152 billion, up 21% year-on-year. Among which, the revenue from cruise operation reached USD 18.609 billion, up 7.7% yearon-year, including USD 13.93 billion from passage ticket, which accounts for 75% of the cruise operation revenue, up 7.6% year-on-year. The net income per berth reached USD 183.3 per night, up 5.3% year-on-year. The total operating cost per berth was USD 158.96 per night. Royal Caribbean Cruises with 23.2% of the global cruise market share reported a total annual revenue of USD 9.494 billion in 2018,

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up 8.2% year-on-year, including USD 6.793 billion from passage ticket, up 7.6% year-on-year. The net profit reached USD 1.816 billion, up 11.7% year-on-year. The net income per berth reached USD 195.7 per night, up 4.4% year-on-year. Norwegian Cruise Line with 9.4% of the global cruise market share, had a total annual revenue of USD 6.055 billion in 2018, up 12.2% year-on-year, including USD 4.64 billion from passage ticket, up 13.6% year-on-year. The net profit reached USD 955 million, up 25.7% year-on-year. The net income per berth reached USD 249.8 per night, up 3.7% year-on-year (Fig. 3). MSC Cruises, the world’s largest private cruise lines, had a total annual revenue of about USD 3.961 billion in 2018, up 21.5% year-on-year, including USD 2.967 billion from passage ticket, up 21.5% year-on-year. The net profit was about USD 500 million, up 11.9% year-on-year. The net income per berth was about USD 152.2 per night, up −0.8% year-on-year. According to the financial report of Genting Hong Kong Limited, a well-known Asian cruise operator, its revenue in 2018 totaled USD 1.6 billion, up 34% year-on-year. The number of days for cruise ships available increased by 19%, the net income increased by 15%, and the load factor increased to 91%. With the first full-year operation of the two new cruise ships, Dream Cruises’ economies of scale have improved. Its earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to USD 72 million, reversing the loss of USD 161 million in 2017. Dream Cruises, the first local luxury cruise brand in Asia designed for Chinese and Asian high-end cruise market, had a profitability above industry average (Table 4).

Carnival Corporation

Royal Caribbean Cruises

Norwegian Cruise Line

Fig. 3 Developments in total revenue of three major cruise operators in recent years. Data source Four Major Cruise Lines’ Financial Report in 2018

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H. Wang et al.

Table 4 Financial status of the four major cruise operators in the world in 2018 Cruise companies

Financial indicator

In 2018

Carnival Corporation

Total revenue (USD 100 million)

188.8

7.83

Ticket revenue (USD 100 million)

139.3

7.6

Net profit (USD 100 million) Net income per berth per night (USD) Royal Caribbean Cruises

5.3

94.94

8.2

Ticket revenue (USD 100 million)

67.93

7.6

Net profit (USD 100 million)

18.16

11.7

195.7

4.4

Total revenue (USD 100 million)

60.55

12.2

Ticket revenue (USD 100 million)

46.4

13.6

Net profit (USD 100 million) Net income per berth per night (USD) MSC Cruises

183.3

21

Total revenue (USD 100 million)

Net income per berth per night (USD) Norwegian Cruise Line

31.52

Growth rate compared to 2017 (%)

9.55 249.8

25.7 3.7

Total revenue (USD 100 million)

39.61

21.5

Ticket revenue (USD 100 million)

29.67

21.5

Net profit (USD 100 million) Net income per berth per night (USD)

5

11.9

152.2

−0.8

Data source Four Major Cruise Lines’ Financial Report in 2018

2 Analysis on the Global Cruise Construction Market 2.1 Global Cruise Construction Market Is in Short Supply With the growing demand for the world cruise market, the supply of existing international cruise construction plants is difficult to meet the increasing demand. Currently,

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an average of 12 large cruise ships is needed every year. It is difficult to meet the fastgrowing demand of the market in a short time by relying solely on European cruise construction plants. By 2027, there will be 114 new cruise ships ordered worldwide, with 247,600 new seats available, of which Carnival Corporation & PLC accounts for 35%, Royal Caribbean Cruises for 16%, Norwegian Cruise Line for 11%, Genting Hong Kong Limited for 5%, other cruise lines for 15% (Table 5). Fincantieri S.p.A, as the world’s largest luxury cruise construction plant, has not been affected by the slump of the international ship construction market. Its orders are still in short supply. Its handling orders are 52 cruise ships, with 104,000 seats, accounting for 49.1% of the global cruise construction market share. Among which, the orders for the construction of 27 new ships were awarded in 2018, with a total value of about USD 9.6 billion, including 14 cruise ships. Its operating revenue reached USD 6.15 billion, up 9% year-on-year. The cruise business revenue grew by 6.4%. The group profit was approximately USD 77.6 million, an increase of 30%. Fincantieri S.p.A boasts strong R&D and innovation capabilities to effectively meet the new needs of the cruise market. It has 3 design centers and 1 research center, as well as 20 shipyards in Italy, USA, Australia, Singapore, Norway, India, Poland, Brazil, etc., with 20,000 employees. In the first quarter of 2019, Fincantieri S.p.A received orders for 11 cruise ships from 5 cruise lines including Oceania Cruises, Regent Seven Seas Cruises, Viking Cruises, MSC Cruises and Princess Cruises, with a contract value of USD 9.36 billion. STX France holds orders for 10 cruise ships with 42,400 seats. Its orders are mainly from Royal Caribbean Cruises and MSC Cruises. The four new “World Class” cruise ships built by MSC Cruises in cooperation with STX France will be delivered in 2022, 2024, 2025 and 2026 respectively. All four new-class cruise ships with a gross tonnage above 200,000 will enlarge MSC Cruises’ fleet rapidly. Meyer Werft GmbH, which is known as the world’s most modern shipyard and boasts the world’s largest indoor dry dock so far, holds orders for 11 cruise ships with 38,900 seats. Its orders are mainly from cruise operators such as Carnival Cruise Lines, Norwegian Cruise Line, Royal Caribbean Cruises and Disney Cruises Line. Turku Shipyard in Finland holds orders for 7 cruise ships with 35,000 seats. Its orders are mainly from Carnival Cruise Lines, Royal Caribbean Cruises, MSC Cruises, Norwegian Cruise Line, and Disney Cruises Line. MV Werften under Genting Hong Kong Ltd., which focuses on large cruise ship construction, holds orders for 6 cruise ships with 11,400 seats. All these cruise ships are tailored for Dream Cruises. Two 200,000-ton “world class” cruise ships are currently under construction, which will be launched in 2021 and 2022 respectively. By the end of 2018, the construction of the first “world class” cruise ship had been completed by 20%. The first cruise ship is expected to be stationed in Shanghai Home Port and Tianjin Home Port to meet the market demand in East China and North China.

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Table 5 Delivery of new cruise ships in the global market in 2019 Cruise companies

Cruise ship name

Shipyard

Aggregate tonnage

Passenger capacity

MSC Cruises

MSC Bellissima

Chantiers de l’Atlantique

167,600

4500

Costa Cruises Asia

Venezia

Fincantieri S.p.A

135,500

4200

Coral Adventurer Cruises

Coral Adventurer

Fincantieri S.p.A

5000

120

Viking Cruises

Viking Jupiter

Fincantieri S.p.A

47,800

930

Royal Caribbean

Spectrum of the Seas

Meyer Werft GmbH

168,600

4180

Celebrity Cruises

Celebrity Flora

Shipyard De Hoop

5739

100

TUI Cruises

Mein Schiff 2

Meyer Werft GmbH

111,500

2894

Hurtigruten Cruise

Roaid Amundsen

KlevenWerft

20,889

530

Oceanwide Expeditions

Hondius

Brodosplit

5590

180

Hapag-Lloyd Cruises

Hanseatic Nature

Fincantieri S.p.A

16,100

230

Ponant Cruise

Le Bougainville

Fincantieri S.p.A

10,000

184

Hurtigruten Cruise

Fridtjof Nansen

KlevenWerft

20,889

530

Legend Cruises

Spirit of Discovery

Meyer Werft GmbH

55,900

972

Aurora Expeditions

Greg Mortimer

China Merchants Group

8000

180

Ponant Cruise

LeDumontD’Urville

Fincantieri S.p.A

10,000

184

Norwegian Cruises

Norwegian Encore

Meyer Werft GmbH

167,800

4200

Carnival Cruises Lines

Carnival Panorama

Fincantieri S.p.A

133,500

3954

The Ritz-Carlton

Unnamed

AstilleroBarreras

Costa Cruises

Costa Smeralda

Meyer Werft GmbH

Hapag-Lloyd Cruises

Hanseatic Inspiration

Fincantieri S.p.A

MSC Cruises

MSC Grandiosa

Princess Cruises

Sky Princess

24,000

298

180,000

5000

16,100

230

Chantiers de l’Atlantique

177,000

4900

Fincantieri S.p.A

143,700

3560

Data source Cruise Lines International Association

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2.2 The Size of New Cruise Fleet in the World Continues to Expand At present, the global orders for cruise construction have been scheduled to 2027. By 2027, the world’s largest cruise operator Carnival Corporation will have 122 cruise ships, with 319,400 berths. Its passenger throughput will reach 15.7751 million, with a market share of 39.9%. Among which, CSSC Carnival Cruise Shipping Limited, a cruise joint venture between China State Shipbuilding Corporation and Carnival Corporation will have two cruise ships. Its passenger throughput will reach 670,000, with a market share of 1.7% (Table 6). Royal Caribbean Cruises, the world’s second largest cruise operator, will have 60 cruise ships in 2027, with 168,400 berths. Its cruise passenger throughput will reach 8.4302 million, with a market share of 21.3%. Royal Caribbean International will be still the world’s largest cruise brand, with 30 cruise ships and 104,300 berths. Its cruise passenger throughput will reach 5.7148 million, with a market share of 14.4%. Celebrity Cruises will have 15 cruises, with 34,000 berths. Its cruise passenger throughput will reach 1.3356 million. As of December 31, 2018, Royal Caribbean Cruises had signed orders for new cruise ships with a total value of about USD 11.4 billion, excluding the orders with its cooperative brands, TUI Cruises and Silversea Cruises. By 2025, the value of Royal Caribbean Cruises’ handling orders will hit a record USD 16.4 billion (about CNY 112.8 billion). Royal Caribbean Cruises has Table 6 Cruise fleets of Carnival Corporation & PLC in 2027 Cruise ships brand

Number of cruise ships

Number of berths (each)

Passenger throughput (10,000-passenger)

Market share (%)

Carnival Cruises Lines

29

84,090

516.05

13.0

Costa Cruises

18

53,247

304.09

7.7

Princess Cruises

19

53,380

215.86

5.5

AIDA Cruises

15

41,012

181.98

4.6

Holland America Line

16

28,682

106.06

2.7

CSSC Carnival Cruise Shipping Limited

2

10,000

67.00

1.7

P&O Cruises

9

27,711

96.22

1.3

P&O Australia

5

9044

50.23

0.8

Seabourn Cruise Line

5

9721

8.29

0.2

122

319,436

1577.51

39.9

Total

Data source Cruise Lines International Association

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Table 7 Cruise fleets of Royal Caribbean Cruises in 2027 Cruise ships brand

Number of cruise ships

Number of berths

Passenger throughput (10,000-passenger)

Market share (%)

Royal Caribbean International

30

104,338

571.48

14.4

Celebrity Cruises

15

34,066

133.56

3.4

TUI Cruises

8

20,534

91.98

2.3

Pullmantur Cruises

4

7358

38.98

1.0

Azamara Club Cruises

3

2122

7.00

0.2

60

168,418

843.02

21.3

Total

Data source Cruise Lines International Association

ordered the fifth Edge class cruise ship for its cruise brand Celebrity Cruises from Chantiers de l’Atlantique at a cost of about USD 900 million in 2019 (Table 7). MSC Cruises, a wholly-owned group in Italy, will have 9 new cruise ships in 2018– 2027. It will own 24 cruise ships in 2027, with 89,600 berths. Its cruise passenger throughput will reach 4.5644 million, with a market share of 11.5%. It will surpass Norwegian Cruise Line as the world’s third largest cruise operator (Table 8). Norwegian Cruise Line, with a brand concept of “commitment, exclusiveness and sincerity”, will have 6 new cruise ships in 2018–2017. It will own 32 cruise ships in 2027, with 72,900 berths. Its cruise passenger throughput will reach 3.5317 million, with a market share of 8.9% (Table 9). Genting Cruise Lines that focuses on Asian cruise market will have 6 new cruise ships in 2018–2027, including 2 for Dream Cruises and 4 for Crystal Cruises. It will own 15 cruise ships, with 26,700 berths. Its cruise passenger throughput will reach 2.0009 million, with a market share of 5% (Table 10). Table 8 Cruise fleet of MSC Cruises in 2027 Cruise ships brand

Number of cruise ships

Number of berths

Passenger throughput (10,000-passenger)

Market share

MSC Cruises

24

89636

456.44

11.5%

Data source Cruise Lines International Association

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Table 9 Cruise fleet of Norwegian Cruise Line in 2027 Cruise ships brand

Number of cruise ships

Number of berths

Passenger throughput (10,000-passenger)

Market share (%)

Norwegian Cruise Line

21

64,330

328.85

8.3

Oceania Cruises

6

5256

14.48

0.4

Regent Seven Seas Cruises

5

3410

9.84

0.2

32

72,996

353.17

8.9

Sum

Data source Cruise Lines International Association

Table 10 Cruise fleet of Genting Cruise Lines in 2027 Cruise ships brand

Number of cruise ships

Number of berths

Passenger throughput (10,000-passenger)

Market share (%)

Star Cruises

4

6505

68.57

1.7

Dream Cruises

4

16,800

120.60

3.0

Crystal Cruises

7

3492

10.92

0.3

15

26,797

200.09

5.0

Sum

Data source Cruise Lines International Association

2.3 The Input into the Construction of New Green Cruise Ships Has Been Intensified With the rapid development of the world cruise industry, the impact of cruise ships on the environment has caused widespread concern. The construction of green cruise ships has become an inevitable trend and common pursuit of the international cruise industry. When a cruise ship anchors, stops or moves, it will produce a large amount of waste water, exhaust gas and solid wastes, which will affect the marine and atmospheric environment. In order to reduce the negative externality of a cruise ship and promote the sustainable development of cruise tourism, the requirements for environmental protection should be fully considered when a ship is built, advanced waste treatment technology should be adopted and the waste treatment system should be optimized. In addition, the consumption of a large quantity of sulfur-containing fuel oil is the main cause for air pollution caused by cruise ships; it prefers to develop clean energy and nuclear power to power the cruise ships in the future. In July 2018, Princess Cruises announced a new shipbuilding plan to build two new-class 175,000-ton LNG-powered cruise ships. The two ships will be built by the famous Italian shipbuilder Fincantieri S.p.A. and are expected to be delivered for use in the second half of 2023 and the spring of 2024 respectively. Thanks to the orders of these two large cruise ships which will be dual-fuel cruise ships powered mainly by

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H. Wang et al.

LNG, Princess Cruises will also usher in a new class of cruises. These are the largest vessels in the history of Princess Cruises, with a total weight of 175,000 tons each and can accommodate 4,300 passengers. On February 27, 2018, Carnival Corporation & PLC signed a contract with the German Meyer Werft for the construction of an 180,000-ton LNG-powered cruise ship. The new ship, to be delivered in 2023, is the third LNG-powered cruise ship built by Carnival Corporation & PLC for its subsidiary AIDA Cruises. The first one was delivered in December 2018 as the first fully LNG-powered cruise in the world and the second one will be named in the spring of 2021. The French cruise line Ponant placed an order with VARD Holdings, a Norwegian shipyard owned by the Italian Fincantieri S.p.A., to build a luxury polar expedition cruise icebreaker. The new ship will become the world’s first electric hybrid cruise icebreaker with LNG propulsion. It is scheduled to be delivered by the Norwegian VARD Soviknes shipyard in the second quarter of 2021. The ship is equipped with an LNG propulsion system specially developed for destinations such as the North Pole, Weddell Sea, Ross Sea and Peter I Island. The Polar Class 2 icebreaker will be able to meet the highest environmental and safe operation standards. In July 2018, TUI Cruises placed an order for two next-generation 161,000-ton LNG-powered cruise ships with the Italian Fincantieri S.p.A. The two new vessels will be built by Monfalcone shipyard of Fincantieri S.p.A., and delivered in 2024 and 2026 respectively. Including the latest two, the Mein Schiff luxury cruise fleet of TUI Cruises will grow by 9 in 2026 (Table 11). On August 31, 2018, the German Meyer Werft held the naming ceremony for the world’s first LNG-powered cruise ship “AIDAnova” built for AIDA Cruises. The “AIDAnova” of AIDA Cruises is 337 m long, 42 m wide and weighs 184,000 tons Table 11 New green cruise ships in recent years Cruise companies

Type of power

Tonnage (tons)

Shipbuilder

Launching time

Princess Cruises

LNG

175,000

Fincantieri S.p.A.

2023, 2024

AIDA Cruises

LNG

180,000

Meyer Werft GmbH

2023

Ponant

LNG and electricity

30,000

Fincantieri S.p.A.

2021

TUI Cruises

LNG

161,000

Fincantieri S.p.A.

2024, 2026

AIDA Cruises

LNG

180,000

Fincantieri S.p.A.

2018

Costa Cruises

LNG

182,000

Meyer Werft GmbH

2019

P&O Cruises

LNG

183,000

Meyer Werft GmbH

2020

Data source Cruise Lines International Association

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in total. It has 2,500 cabins and more than 5,000 beds, capable of accommodating 6,600 passengers. The ship is equipped with four dual-fuel engines that can operate in ports and on the sea using the most environmentally friendly and lowest-emission fossil fuels. It is also the world’s first cruise ship that can be fully powered by LNG, making it the first cruise ship in the industry to use 100% LNG power in ports and on the high seas. In October 2019, Costa Smeralda, with a total tonnage of 182,700 tons, will be officially launched. It is scheduled to make her maiden voyage on October 20, 2019, with stops in Barcelona, Marseille and Civitavecchia. With a passenger capacity of 6,518, a crew size of 1,682 and 2,612 cabins, the ship currently is the largest new cruise ship of Costa Crociere S.p.A., the first LNG-powered cruise in the fleet, as well as the largest cruise ship ever built by the German shipbuilder Meyer Turku. In 2021, the German Meyer Turku will deliver a second LNG-powered cruise ship to the Costa Crociere S.p.A. to further expand the size of its cruise fleet.

2.4 The Global Cruise Refurbishment Market Boasts Great Potential According to the statistics of the Cruising Lines International Association (CLIA), each cruise ship undergoes a dry dock every three years on average, with an average period of 14 days. In 2018, the dry dock time of global cruises totaled 1,500 days. During the dry dock, the operator spends about USD 2 million per day. Therefore, the global cruise dry dock & refurbishment market has an annual output value of more than USD 3 billion. For each large luxury cruise ship, it would cost about USD 10 million to USD 50 million on refurbishment, mainly for interior upgrade. The global cruise refurbishment business is mainly concentrated in Miami, Europe, the Bahamas and Singapore. Singapore together with German, occupies an important position in the international luxury cruise refurbishment and repair market. In 2018, the fleet of Carnival Corporation & PLC spent as long as 490 days on upgrading and refurbishment in the dry dock while in 2019 the number grew to 500 days. In 2019, the cruise ship refurbishment market continues to prosper. Carnival Corporation & PLC is planned to invest USD 200 million into a 2-month-long bow-to-stern makeover of its “Triumph”. After the upgrade, the facilities will be advanced in all aspects and the cruise will be renamed from “Triumph” to “Sunrise”. The refurbishment is scheduled to be completed for delivery in April 2019. The Carnival “Ecstasy” refurbishment project will begin on October 5, 2019 and be completed on October 16. The nearly-20-year-old “Triumph” cruise ship will enter dry dock in Cadiz, Spain for a two-month-long refurbishment staring March 1, 2019, which will cost nearly USD 200 million (Table 12). In 2018, the Royal Caribbean International’s fleet spent 280 days on dry dock, and this number grew to 360 in 2019. Royal Caribbean International will carry out a major refurbishment of its “Voyager of the Seas”, which will cost about USD 150

20 Table 12 Cruise refurbishment of Carnival Corporation in 2019

H. Wang et al. S/N

Cruise ship

Commencement date

Completion date

1

Carnival Fantasy

January 7, 2019

January 20, 2019

2

Carnival Pride

February 3, 2019

February 16, 2019

3

Carnival Freedom

February 13, 2019

March 3, 2019

4

Carnival Triumph

March 1, 2019

April 28, 2019

5

Carnival Ecstasy

October 5, 2019

October 16, 2019

6

Carnival Imagination

October 20, 2019

November 2, 2019

million and complete for service in May 2019. In September 2018, SkySea “Golden Era” was acquired by the German TUI AG after closing its operation in China. The vessel was first rebuilt in Cosco (Zhoushan) Shipyard, Zhejiang Province, and then refurbished in Cadiz, Spain. The style and theme of the cruise were completely remodeled and later in April 2019, the vessel, as “Marella Explorer 2”, re-entered the service for Mediterranean cruises at the home port of Parma, Italy. In 2019, the fleet of Norwegian Cruise Line will undergo a 120-day dry dock upgrade, an increase of time compared to 2018. In February 2019, Norwegian Cruise Line signed a contract with MJM Marine, a multinational ship assembly company, for a USD 50-million renovation of the “Norwegian Joy”. The refurbishment was officially kicked off in China on March 11 this year, including adding a Starbucks, expanding the spa and gym, downscaling the retail stores and casinos, and building more bars, and completed for operation in Seattle on April 21, with a total duration of about 40 days. In April 2019, the “Norwegian Joy” replaced “Norwegian Pearl” as the third cruise ship deployed by Norwegian Cruise Line in the Alaska region, and sailed in the region together with “Norwegian Bliss” and “Norwegian Jewel”, heading to Los Angeles, and starting the 2019/2020 winter voyage to the Mexican Riviera and the Panama Canal. In addition, Norwegian Cruise Line will also spend another USD 100 million on the upgrade of four R-class cruise ships under Oceania Cruises. From February 11, 2019, the “SuperStar Virgo” of Star Cruises will cease operation and be refurbished at a cost of USD 50 million. Afterwards, in April 2019, the vessel will re-enter service under the name of “Explorer Dream”, joining the fleet of Dream Cruises from Star Cruises. The “Sapphire Princess” of Princess Cruises will undergo a two-week dry dock in Singapore in April 2020.

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3 Analysis of the Development Situation of Asian Cruise Market 3.1 Asian Cruise Market Grows Steadily According to data from the Cruising Lines International Association (CLIA), the scale of Asian cruise market in 2018 reached 4.24 million people, a year-on-year increase of 4.6%. In terms of the distribution of tourist source, Chinese mainland accounted for 55.8% in the Asian market, dropping from 59.3%, but still occupying more than half of the Asian market. Taiwan, China, still maintained the second largest cruise tourist source market in Asia with a 9.3% share. The proportion of HKSAR, China’s cruise market increased significantly, from 3.8% in 2016 to 5.9% in 2018, and India’s market share also markedly grew from 4.4 to 5.2% (Fig. 4). Except the decline in the size of the cruise market in Chinese mainland and Malaysia, Singapore, India, Indonesia, the Philippines, ROK, Thailand and Vietnam all experienced a twofold growth. Thanks to the deployment of more new ships in the Asian cruise market by cruise lines such as Royal Caribbean International, Costa Crociere S.p.A. and MSC Cruises, the Asian cruise market will grow further. This has a direct relationship with Asia’s sound economic foundation. Against the backdrop of rapid global regionalization, although Asia still faces great pressure of economic development, Asian economies have gained an opportunity to transform their development models on the strength of organic growth, as well as an opportunity to inject more capital and technologies into Asia. With the strengthening awareness of a community of common destiny in Asia and the further integration of Asian economies, in the future, the Asian economy will develop steadily on the basis of self-reliance, and relying on huge consumer market and infrastructure construction market, it is expected to take a lead in moving out of recession in the world and achieve a fundamental improvement in a secure environment (Fig. 5). 450 400 350 300 250 200 150 100 50 0

420

424

2017

2018

310

77.4

2012

120.5

2013

139.8

2014

164.6

2015

2016

Fig. 4 Changes in the tourist sources of Asian cruise market (unit: 10,000 people). Data source Cruise Lines International Association

Vietnam

Thailand

South Korea

Philippines

Indonesia

Malaysia

India

HKSAR, China

Japan

Singapore

Taiwan

H. Wang et al.

Chinese mainland

22

Fig. 5 Changes in shares of Asian cruise market by region/country. Data source Asian Cruise Industry Ocean Source Market Report (2018)

3.2 Asian Cruise Tourists Are Apparently Becoming Younger The average age of tourists of the Asian cruise market stood at 45.4 years, which is basically the same as the 45.6 in 2017. In recent years, the average age of tourists in the Asian cruise market has not changed significantly. The tourists over 50 years old took up about 50% of the market, making them the most important part of the tourist market. This is also consistent with the age characteristics of tourists in the international cruise market. In 2018, the average age of Asian cruise tourists was 45.4 years old, with 13% of tourists aged below 19, 9% aged 20–29, 16% aged 30– 39, 14% aged 40–49, 17% aged 50–59, 21% aged 60–69, and 10% aged 70 or above. Indian cruise tourists were at a lower level of age, with an average age of 37. The average age of Indonesian cruise tourists stood at 39, while Japanese cruise tourists were older, with an average age of 57 (Fig. 6).

3.3 The Transport Capacity of the Asian Cruise Market Has Gradually Increased According to the statistics of the CLIA, in 2018, there were 68 active cruise ships under 35 cruise brands in the Asian cruise market, including 5 mega cruise ships, 14 large-sized cruise ships, 28 medium-sized cruise ships (the most type), 17 smallsized cruise ships and 4 expedition cruise ships. The cruise lines operating in Asia

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>=70 60-69 50-59 2018

40-49

2017 2016

30-39 20-29