Marine Log - February 2009 - (Page 20) CRUISESHIPPING ICE CLASS TANKERS The 3,300-passenger MSC Fantasia is the largest cruise ship yet built by a European shipowner case for all North American destinations and ports. Caribbean traffic was down 7.1% while most of the seasonal markets held up fairly well. Among the ports, Fort Lauderdale and Port Canaveral bore the brunt of traffic loss. ECONOMIC IMPACT Studies of the cruise industry’s contribution to both the U.S. and European economies are conducted annually for CLIA and the European Cruise Council. The 2007 study reports $18.7 billion in direct spending in the U.S. by cruise lines and passengers (up 6% from 2006), and $38 billion in total outputs (also up 6 %). This supported 355,000 jobs paying $15.4 billion in wages. Reflecting the huge growth in Europe and the impact of the cruise shipbuilding sector there, direct cruise industry spending was reported at EURO 12.9 billion (up 22%), and total outputs at EURO 29.4 billion, an increase of 24%. This supported about 300,000 jobs paying EURO 9.3 billion. Thus, for the first time in 2007, direct expenditures in Europe equaled those in the U.S., and including indirect impacts, the total gross output generated by the cruise industry in Europe exceeded that in the United States. OUTLOOK There are certainly a number of positive aspects regarding the cruise industry’s short term prospects that could support guarded optimism. Cash flow for efficient operations is quite high. The industry leaders have new and innovative ships. The assets are highly mobile and can be moved in response to shifting demand. Customer satisfaction is extremely high. Compared to vacation alternatives, cruises are an outstanding value. There is a very low cruise penetration rate. Fuel surcharges are gone and special pricing offers abound. However, the overarching economic climate cannot be overlooked. Already, booking horizons have shortened substantially. It is likely that yields will decline considerably, adding the burden to control and cut costs to the need to continue to fill the ships. Indeed, we are in uncertain and challenging times, and it is obviously the industry’s hope that the demographics of its customer base, consisting largely of those best able to survive the economic downturn, coupled with the attractiveness of the product and the incentives being offered will confirm the judiciousness of its optimism. ML 20 MARINE LOG FEBRUARY 2009 www.marinelog.com http://www.csdsealingsystems.com http://www.csdsealingsystems.com http://www.marinelog.com
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