Cruises Navigating Rough Economy

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By: TED JACKOVICS
Media General News Service

Published: May 9, 2008

TAMPA — Rising gasoline prices, hotel rates, food expenses and an unfavorable international currency exchange continue to wreak havoc on vacation plans.

But Terry Dale, president and chief executive of the Cruise Lines International Association, based in Fort Lauderdale, said predictions in January that 2008 would be a record year with 12.8 million cruise passengers still hold true. Dale discussed the cruise industry in an interview with The Tampa Tribune on Wednesday.

One Tribune reader said he received 18 unsolicited e-mail offers of cruise discounts in the past week. Most offer four-figure savings for cruises launched overseas. What does this marketing volume say about the cruise industry economy here and abroad?

We see from booking trends people still have wanderlust. In a tight economy, people want to stretch their dollars. The cruise industry wraps in one price accommodations, cuisine, entertainment and visits to multiple destinations. So the message [in the offers] is there is tremendous value in the cruise industry today.

What is the update on your 2008 travel forecast?

We are on track. Occupancy trends are pacing 100 percent [based on lower berth occupancy]. We are very bullish on our forecast for Europe, Asia, Australia and South America, but it is important people know they can find space on ships.

The cruises from Tampa remain with ports in the Caribbean. So how do area residents generally travel to reach cruises from Europe and elsewhere?

Mostly on airlines. I live in Fort Lauderdale, so I might fly to Houston for a flight to Europe or to Newark or JFK in New York. You can either book separately with the airlines or on a package with cruise lines, which buy airline tickets in bulk.

What’s new in cruise marketing?

Make no mistake, a cruise is not a commodity, like booking a hotel or an airline ticket. It is a very individually produced product. Someone might be very comfortable booking a Hilton or a Marriott in Boise, Idaho, or Chicago and know what to expect.

But with 175 ships carrying from 100 passengers to those with an excess of 3,000 passengers, our industry wants the consumer to work with trained travel agent professionals. If we pair you with the right vacation, you will come back with us the rest of your life.

How do cruise lines contend with increased fuel and other costs?

It absolutely is a balancing act. Cruise lines pre-purchase and hedge on the purchase of fuel as much as they can.

Can you compare the cruise line industry with the airline industry?

The differences are extraordinary. Airlines sell a commodity. Cruises are not commodities. They are very individual [packages]. Whatever your pocketbook, the individual customers get the right fit.

What is your perception of Tampa’s prospects for cruise industry growth?

Tampa is a very strong market, one we will continue to focus upon. There are some physical restraints with [new, bigger ships] and the passage beneath the Sunshine Skyway bridge, but I cannot really speculate about it. An example of what we do, we recently got together with officials from the port, the visitors bureau, the mayor’s office and others for discussions about the industry.

How is the Port of Tampa affected by the cruise lines’ strategy to sail from Florida ports such as Jacksonville, Port Canaveral, Port Everglades in Fort Lauderdale and Miami?

Tampa will always be part of the Florida cruise market. We always want to be a good partner in local tourism, so we work through travel agents and encourage people to come in a day or two early, book a hotel room and explore the history and culture of the local community. We work with 16,000 travel agencies. We have significant influence that as an industry we are speaking as one voice.

What is the prospect that Disney might serve Tampa with one of their cruise ships?

I could not speculate about Disney.

TED JACKOVICS is a staff writer for The Tampa Tribune

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