Report Details Cruise Industry’s Pricing Problem

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May 20. Cruise lines will have to lower prices in the second half of 2022 to fill ships because cumulative bookings are “in a deep hole” compared with 2019 levels, according to a report written by Truist Securities equity research analyst C. Patrick Scholes.

The good news for cruise lines is that guests’ onboard spending is at record levels, a trend in cruising since the lines returned to service from the pandemic. It’s not good news for travel agencies, however.

Scholes wrote that 2023 pricing is holding for now, but that the new year is seven months away and current booking trends don’t look good. He wrote that the booking pace for 2023 “continues to decelerate and is significantly below comparable 2019 levels.”

Therefore, the cruise lines might cut prices to fill ships in 2023, similar to what’s happening this year.

Illustrating the cruise lines’ pricing issues, travel agency executives told Scholes that the lines haven’t added fuel surcharges because they don’t have the pricing power to do it without putting even more pressure on bookings.

Excess supply also may be a factor in falling prices, as supply growth is approximately 12% above 2019 levels and up another 6% to 7% in 2023, Scholes wrote.

Source: Travel Weekly

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123330cookie-checkReport Details Cruise Industry’s Pricing Problem