Cruise Lines in U.S. Look to China For Growth

The Quantum of the Seas, a cruise ship in the Royal Caribbean fleet was not even a year old when the cruise line swapped out its retro burger joint Johnny Rockets for a noodle restaurant and eliminated the duty free store in favor of a luxury leather shop.

The ship’s overhaul came with a May move from the east coast of the U.S. to Shanghai, as part of the industry’s push to capitalize on soaring demand from the world’s second largest economy, a market with the possibility to generate close to seven times the number of passengers as in the U.S.

To catch and ride that wave of cruise travelers that are expected to sail from China the next couple of years, cruise lines based in the U.S. are investing in large amounts in remodeled and new ships, while in certain cases relocating the most modern as well as luxurious shops from ports in the U.S. to China.

Recent indications of a slowing economy in China have not yet dimmed enthusiasm.

One of the cruise line’s executives said that even though China is a new market, the potential is so huge that over time it is likely that it will become the largest market for cruise passengers in the world.

The United States remains the leading source in the world of cruise passengers at 11 million annually, but the Tourism Board in Hong Kong estimates China with an overall population of more than 1.4 billion could potentially generate up to 83 million passengers for cruises each year.

The cruise ship industry worldwide is rebounding from a number of mishaps that have marred its image over the past couple of years.

The amount of vacationers, who are buying cruises worldwide, was up by approximately 7% annually beginning in 1990.

That pace has slowed to only 2% since the Costa Concordia crash in 2012 off the Tuscan coast of Italy and the fire in 2013 on the Carnival Triumph, which disabled that cruise ship in the Gulf of Mexico.

However, in 2016, it was expected that passenger growth would pick up by 4% over 2015 to more than 24 million passengers.

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