An Eye on Cruises: Cruise Market Overview 2012

Transcription

Institut für
Maritimen
Tourismus
An Eye on Cruises
Cruise Market Overview 2012
Prof. Dr. Alexis Papathanassis
University of the Aegean – Chios 13.09.2012
© Alexis Papathanassis
Cruises are becoming more
differentiated, appealing
to a wider population of
holiday makers
German Pax Development ('000)
European Pax Development
1800
UK; 1622
1600
Germany;
1219
1400
Pax ('000)
1388
1219
1027
1200
907
Italy; 889
1000
800
Spain; 645
600
537
583
2003
2004
639
705
763
France; 387
400
200
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
Base data: European Cruise Council (2012 Online)
* River Cruises are not included in the data
2005
2006
2007
2008
2009
2010
2011
World Market Share
US Market Share
NCL
10%
Louis
4% Hurtigruten
4%
Thomson
4%
Star
5%
Disney Others
5%
2%
MSC
2%
Carnival
55%
MSC
10%
Royal Caribbean
26%




Royal
Caribbean
19%
Leverage over suppliers & destinations
Economies of scale
Risk-spreading & financial reserves
Difficult for new entrants due to shipbuilding sector concentration
* Source Data: Cruise Market Watch (2010) in Lekakou et al. (2011)
Others
4%
Carnival
50%
 2010*:
 Global cruise fleet 298
vessels amounting >
400,000 berths
 About half operate in
Europe
 2012-2016**:
 Total Ships: 20
 Total Berths: 57,751
 Total Order Book Value:
$13,468,000,000.00
 Average Price Per Berth:
$273,183
* Source Data: Cruisecommunity.com, Accessed: 10.10.2011
** Source: ISL (2011), Accessed: 10.10.2011
Cruises equal a licence
to print money!
“Evil - Eye” belief, that a a ‘look of envy’ can
cause misfortune to the fortunate ones
Let’s put the cruise sector to the test!
F&B
9%
Other
11%
Petrochemicals
13%
Business
Services
21%
Total Direct
Expenditure
(€15 Billion)
Cruise Line
Purchases in
Europe (€ 6.4
Billion)
Manufacturing
24%
Transport
22%
Portugal
2%
Spain
2%
Norway
6%
France
2%
Cruise Employee
Compensation
Shares (€1.3
Billion)
Germany
8%
Cruise Line
Purchases
42%
Pax & Crew
Purchases
23%
Cruise
Employee
Compensation
9%
Embarkation
Spending
(mainly
airfares)
47%
Other
13%
Finland
3%
France
17%
UK
40%
Pax & Crew
Spending
Breakdown (€
3.4 Billion)
Visit
Spending
(Shopping,
F&B, Tours)
50%
Shipbuilding
26%
Rest
5%
Italy
32%
Shipbuilding
Expenditures
In Europe (€
3.8 Billion)
Germany
35%
Italy
35%
Crew
Spending
3%
Base data: European Cruise Council (2012: Online)
Netherlands
2%
Portugal
2%
Rest
9%
All Other
13%
Italy
32%
Norway
4%
Cruise Lines
18%
Hospitality
5%
Greece
4%
Finland
1%
Where do
they
work?
France
5%
Trade
9%
For whom
do they
work?
Spain
9%
Germany
12%
UK
20%
Base data: European Cruise Council (2012: Online)
Financial &
Business
Services
19%
Manufacturing
23%
Transportation
& Utilities
13%
Cruise Income is primarily
created by production at
the source markets; not
by consumption at the ports!
Linear Extrapolation
Quadratic Extrapolation
Cubic Extrapolation
R² = 0,9437
1990 1995 2000 2005 2010 2015 2020



Least data fit (R2 = 94%)
30 Million Pax by 2041
Indefinite growth assumption
Source data: CLIA (2010)
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
R² = 0,9873
1990 1995 2000 2005 2010 2015 2020



Second best data fit (R2 = 98%)
69 Million Pax by 2041
Indefinite growth assumption
Cruise Passengers (000)
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
(S-Shaped Curve)
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
R² = 0,9923
1990 1995 2000 2005 2010 2015 2020


Best data fit (R2 = 99%)
Compatible with the
Product Life Cycle concept
 Historically applicable for
tourist destinations (Butler
1980, 2006) and
 Tourism segments
(Zimmermann 1997)


Bass Diffusion Model (1968):
 Represents an S curve – Just like the Product- or DestinationLife Cycle
 Can be used for forecasting the slope of the S curve, on the
basis of the market potential and the degree of imitation and
innovation
Source: Nee & Papathanassis (2011)
Assumptions:
 Market Potential in Germany approx. 5 million
─
─

Travellers spending more than €1700 on a vacation
Demographic structure remains the same
Innovation and imitation coefficients are calculated from the
historical data (currently demand is determined by imitators –
cruise market has left the introduction phase)
The only form of
continuous growth is
taxation… but not for
cruises!
* Source: Vogel (2008)
-1
EBIT
-7%
Net OR
-11%
Onboard expenses
-13%
Onboard Revenue
0
Food
1
Depreciation
0
2
Payroll
28%
3
Marketing
6
Commiss./transport
5
Other operating
-16%
Billions of US$ (nominal)
-20%
Ticket Revenue
+33% -5%
EBIT
-8%
Net OR
-11%
Onboard expenses
-14%
Onboard Revenue
Food
2
Depreciation
4
Payroll
Marketing
8
Commiss./transport
Other operating
Ticket Revenue
Billions of US$ (nominal)
10
100% -31%
100% -35%
4
-25%
-18%
+39% -9%
20%
Competition on land
monopoly at sea
80
300
70
250
50
Revenue per PCD
(real US$) -2.2%
p.a.
-20%
Revenue per PCD
(real US$) -1.8%
p.a.
-17%
40
200
150
30
Passenger cruise days
(PCD) +13.1% p.a.
20
100
Passenger cruise days
(PCD) +8.5% p.a.
10
50
0
0
2001
2003
2005
2007
2009
2011 2001
2003
2005
2007
2009
2011
Real US$ (2011)
Millions of PCDs
60
250 $
Cost per PCD (real US$)
200 $
$207.67
Fuel
Food
-17%
Deprec.
150 $
Payroll
Marketing
100 $
$172.63
+143%
-16%
-6%
$207.80
Fuel
Food
50 $
-36%
+129%
Payroll
-32%
-19%
Marketing
1%
Other
-31%
-27%
-8%
-36%
Commission
& transp.
$174.36
Deprec.
-14%
Other
-16%
Commission
& transp.
-38%
0$
Cost reduction
2001 excluding fuel: -25%
2011
Cost reduction
2001 excluding fuel: -21%
2011
Profit margins have
decreased by approx. 4%
over the last decade and
are following a downward
trend
Environment
• Image issue (‘From Paper to Practice’)
• Friends of the Earth Scorecard
• Cruise Operators’ sustainability reports
• Integration of new technologies on existing fleets
Cost Pressures &
Competition
• Rising fuel prices
• Safety & security regulations
• Personnel costs
• Fusion packaged tourism – cruise tourism (extended
competitive scope)
Overcrowding &
Itineraries
• Customer satisfaction deterioration
• Relationship between locals & tourists (Antagonism)
• Destination limitations (Seasonal, infrastructural)
Social Responsibility
• Tax avoidance – Flags of convenience
• Image issue (‘Sweatships’)
• Intl Transport Workers’ Federation (ITF)
• International Labour Organisation (ILO)
• Crew living & employment conditions
• Criminality on board (Balancing security with recreation)
The age of online
transparency has
arrived…What happens
at sea does not stay at
sea anymore!
Perhaps the ‘evil eye’ is not a superstition…
… But a metaphor for the inevitability of
systemic laws in the age of a technological
diffusion and digital democracy!

Research Functions:
-
Founder & Chairman of the Cruise Research Society
(http://www.cruiseresearchsociety.com)
Co-Director of the Institute for Maritime Tourism (IMT)
(http://www.imt.hs-bremerhaven.de/)
Editorial Board Member of the Journal of the European Journal of
Tourism, Hospitality and Recreation (EJTHR) –
(http://www.ejthr.com/)
Reviewer of the Tourism Management Journal
(http://journals.elsevier.com/02615177/tourism-management/)
-
-
-

Administrative Functions:
-
Dean of Studies – Faculty of Business & Economics
Chairman of the CIM Examinations Committee
Member of the CIM Study Affairs Committee
•
•
•
•
Clean Ships?
Sweatships?
Friends of the Earth Scorecard
References
Black Water:
• Human Waste (Toilets, Medical Facilities)
• 30 Litres per Cruise Pax / day
Main Sources:
Gray Water:
• Incinerators
• Engines
• Wastewater from sinks, showers, galleys, laundry, and cleaning
activities
• 340 Litres per Cruise Pax / Day
An average cruise ship‘s daily
emissions
• = 12.000 automobiles
Solid Waste:
• Plastic, paper, wood, cardboard, food waste, cans, glass, etc.
• 1990s: 3.5 Kg per Cruise Pax / Day
• 2010: 1.7 Kg per Cruise Pax / Day
Oily Bilge Water
401g of CO2 is emitted per Cruise
Pax / Km
• Water containing fuel, oil, wastewater from engines and other
machinery
• Average cruise ship produces 8 tons in 24 hours of operation
• 36 times more than a Eurostar Pax / Km
• 3 times more than a Boeing 747 Pax / Km
• An estimated 60,000 people die worldwide each
year as a result of under-regulated shipping air
emissions
• This estimated to grow by 40 percent by 2012
Ballast Water:
* Source: Ross (2009)
• To stabilize the vessel during transport
• Often taken on in one location after a ship discharges wastewater
or unloads cargo and then discharged at the next port of call
• Contains a variety of biological materials, including non-native
plants, animals, viruses and bacteria
Applicants from poor
countries (Philippines,
Indonesia, India)
Between $1500-2000 to
get the job
Job start with a credit
Money sent home = $300
/ month (7 months’ work
+ 2-3 months’ lay-off)
F&B: Low paid, noncustomer facing staff =
$350-500 / month
Housekeeping: Low paid,
non-customer facing staff
= $600-800 / month
Cruise staff: Staff
organising activities for
passengers = $1800-2100
/ month
* ITF (2001)
** Source: www.cruiseshipjob.com, Accessed: 20.10.2011
Working Conditions:
http://caradecrew.blogspot.com/2008_09_18_archive.html
Indicative Wage
levels**
Costs of getting a
Cruise Job*
http://www.cruisejobsblog.com/wpcontent/uploads/2011/01/cruise-girl.jpg
Long-working hours
• … But tax free income!?
Private quarters & crew
facilities – quality of life
• … But no extra living costs
(accomm & catering)
Long absence from family
& friends
Whether a cruise line has installed the
most advanced sewage and wastewater
treatment systems available instead of
dumping raw or minimally treated
sewage directly into the water
Whether a cruise line has retrofitted
its ships to “plug in” to available
shore-side electrical grids instead of
running polluting engines when
docked
* Source: Friends of the Earth – http://www.foe.org/cruisereportcard
To what degree cruise
ships violated 2009 water
pollution standards
designed to better protect
the Alaskan coast
How easy the cruise lines have made it
for the average consumer to find
information on their websites about
cruise industry environmental practices
and technology

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
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



European Cruise Council (2012). The Cruise Industry: Contribution of Cruise Tourism to the Econonies of Europe, URL:
http://www.europeancruisecouncil.com/content/economic%20report.pdf
Friends of the Earth (2011). Cruiseship Environmental Report Card. Available Online: http://www.foe.org/cruisereportcard.
Accessed: 30.08.2011
ISL (2011). Shipping Statistics & Market Overview. Institute of Shipping Economics & Logistics, 55(8):5-74
ITF (2001). War on Want. URL: www.waronwant.org/attachments/Sweatships.pdf , Accessed 11.10.2011
Lekakou, M.B., Pallis, A.A. and Vaggelas, G.K. (forthcoming). “Which homeport in Europe: The cruise industry’s selection
criteria”. Tourismos (forthcoming).
Nee, I (2011). Maturity in sight? An Analysis of the Demand Potential and the Diffusion Extent of Cruises in Germany.
Hochschule Bremerhaven Thesis, supervised by Prof.Dr. Alexis Papathanassis
Ross, K (2009). Getting a Grip on Cruise Ship Pollution. Available Online:
http://www.foe.org/sites/default/files/CruiseShipReport_Klein.pdf. Accessed: 30.08.2011
Sea Trade Insider (2011). Orderbook. URL: http://www.cruisecommunity.com/Orderbook.html, Accessed: 10.10.2011
Vogel, M. (2008). Crises & Cruises: Cruise Line Economics 2001-2011. Presented at the 4th International Cruise Conference
(Leeuwarden, Netherlands). May 21st
Vogel, M. (2012). Onboard Revenue – The Secret of the Industry’s Success?. Presented at the 1st International Cruise
Conference (Bremerhaven, Germany). September 26th

An Eye on Cruises: Cruise Market Overview 2012

Transcription

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