SMART New Ocean Industries
“Growth of Cruise Tourism in Asia”
Kelvin Tan
Regional Director, Asia Pacific
Royal Caribbean Cruises Ltd.
Global Cruise Industry
“ The modern cruise industry was established in North America in the late
1960’s. The cruise industry operates across two sectors of commerce,
transportation and hospitality.
The cruise lines sell and operate ships which transport guests to scheduled ports
of call, primarily for pleasure. An inherent part of the experience is the variety
of hospitality services offered onboard such as well appointed
accommodations, upscale dining, bars, casinos, spa treatments, shopping and
land tours. ”
• Small but Growing Segment of Vacation Market
- Approx. 20 Million Passengers
- More than 360,000 Berths
- 260 Ships
• All Regions Remain Under-Penetrated
• Measured Growth in North America
• Accelerating Growth in Rest of the World
Global Industry Growth 7% CAGR
Global Annual Cruise Guests
25
7% CAGR
Guests (Million's)
20
15
10
5
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Year
Source: G.P. Wild (international Ltd) from PSA, CLIA, ECC and other sources
3
Array of Brands in the Marketplace
Evolution of the Industry
2009
2006
2003
1990
1980
1970
Growth pf New Cruise Regions
Historically, the focus on the cruise lines has been to develop the North
American cruise market and much of the total growth in the
1970’s, 1980’s and 1990’s originated from this market.
The global appeal of cruising and the compelling holiday value
proposition it offers was beginning to be recognized by a wider
audience in the late 1990’s particularly in European markets and
cruise companies started to invest heavily in the European arena.
In the past decade, Asia is a fast emerging market that many cruise
lines are very keen to expand into the region. China and India, in
particular are immensely promising, given the rise in income levels
and overall population size.
Cruise Market Size
In 2010, the estimate cruise market size in Asia is close to that of Europe in
1997. It is expect that Asia cruise tourism will experience a similar growth
pattern in the next decades.
12
Cruise Market Growth By Region
North America
Guests' Millions
10
8
Europe
6
4
Asia
2
Latin America
1997 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Cruise Hubs & Deployment
Due to the worldwide nature of the cruising industry and the mobility of
the assets, the deployment of the ships is highly variable.
Year-round cruise destination mainstays include the Caribbean,
Bahamas and Mexico. Seasonal markets include the Mediterranean,
Alaska, Baltic and South America.
In the recent years, more cruise lines are starting to deploy ships in Asia
on a year round or seasonal deployment.
The three regional cruise hubs are Shanghai, Hong Kong and Singapore.
There are also secondary homeports emerging in Asia such as Tianjin,
Xiamen, Yokohama and Busan.
Cruise Industry in Asia
As the cruise tourism starts to take shape in Asia, there are
many factors and development that stakeholders such
as Government bodies, port authorities, tourism bureau,
travel agents, airlines, etc are paying more attention
and directing resources towards the emerging industry.
Below are some of the key topics highlighted in this
presentation :
Cruise Industry in Asia
Economic benefits of a cruise industry and homeports in Asia :
Significant economic impacts to a country associated with the cruise industry.
When a cruise ship visits a port, each ship requires a variety of services
such as :
•
Tours for guests, bunkering, supplies & provisions, and port agency
service.
•
Hotel accommodation for pre/post-cruise, flights for fly-cruise guests,
land transportations,
•
Merchandise shopping, and various retail business patronized both by
cruise
guests & also the ship crews.
•
Homeports with reputable shipyards can also benefit from ship repair and
vessel refurbishment business.
•
Large number of Asian crews working onboard cruise ships all around the
Cruise Infrastructure
The infra-structure development and investments in the port cities :
Infra-structure investment by the Governments or the local port cities is needed to
accommodate the needs of the cruise ships of today and tomorrow.
It is important for cruise lines and all the local stakeholders to work together to
layout the blueprint for cruise lines’ growth in Asia.
Deployment decisions are often done years in advance before the ships are
actually deployed. Thus, there will be sufficient time for ports to enhance its
facilities and even construct new terminal buildings to handle large cruise ships.
Cruise Terminal Development
New cruise terminals in key turn ports in the
region:
- Tianjin Cruise Terminal (2010)
- Shanghai Wusongkou/Baoshan Cruise
Terminal (2011)
- Singapore International Cruise Terminal
(2012)
- Hong Kong Kai Tak Cruise Terminal (2013)
Partnership Considerations
The role of Government, ports, travel trade and suppliers in the success of
building sustainable cruise tourism.
In order for the cruise tourism to grow in Asia, it is important how the government
& authorities will treat the cruise industry. The cruise concept is a hybrid &
combination of marine transportation, lodging & accommodation, and tourism all
roll into one.
Passenger shipping legislation and taxation is a key factor for cruise company,
planning to achieve a successful and profitable entrance to the Asian cruise market.
Other important issues and concessions include the maritime law & policy,
relaxed visa requirements, reasonable head tax and port charges, expedited
clearance procedures in ports.
Desirable Operational Conditions

Clean, safe and secure port facilities

Ports that can handle today's larger ships

Operational capabilities to handle volume

Reasonable cost structure

Great shore excursions at reasonable prices

Professional port services
OutstandingDestinations
Destination
Outstanding
Source: UNWTO World Tourism Barometer June 2008
15
Royal Caribbean Cruises Ltd.
Royal Caribbean Cruises Ltd.
• Second Largest Cruise Company
• Six Brands
• Ships / Berths
In 2012:
43, 102,000
• Over 4 Million Guests Annually
• 55,000 Employees
• Visit Over 430 Destinations Worldwide
Worldwide Distribution Network
Blue – 16 Global Corporate Offices
Green – 48 International Representatives (GSAs)
Summary
Cruise industry is a sun-rise industry
Asia holds incredible potential as a cruise destination
Under penetrated cruise market
Partner with government to improve infrastructure
Stable and consistant operating conditions
Partner with travel industry to create cruise awareness
Profitability