Wednesday, March 12, 2014
PORTLAND – The city is expected to see an increase in cruise passengers in 2013, but there won't be as many ships bringing them in.
In this September 2012 file photo, a Segway tour passes in front of the Carnival Glory cruise ship in Portland. The city is seeing an increase in cruise-ship visitors in 2013.
John Patriquin/Staff Photographer
The Carnival Glory towers over the Portland waterfront Monday in this view from the corner of Franklin and Congress streets. The ship has a capacity of 2,984 passengers and a crew of 1,150, according to Carnival Cruise Lines.
Gabe Souza/Staff Photographer
The Port of Portland, which opened a longer, deeper-water pier in 2011 to accommodate larger cruise ships, is expecting 71,255 passengers on 58 ships this year, a 3.5 percent increase. By contrast, 68,861 cruise ship passengers visited Portland on 59 ships in 2012.
The increase in passengers coupled with fewer ships mirrors a trend in the industry toward both ends of the scale: bigger ships that carry thousands and come with family-friendly amenities such as water parks, and smaller, more luxurious ships that carry only a couple of hundred passengers.
The cruise industry launched 12 new ships and one refurbished ship last year, despite recent problems on several cruise ships, including illnesses, power failures and fires. Seven of the new ships carry fewer than 170 passengers each, while five ships have capacity for more than 3,000 passengers each. Only one ship was launched in the midsized range of 1,260 passengers, according to the Cruise Line Industry Association, an industry trade group.
The bigger ships command the bulk of the industry's profits because of the high volume of customers and the growing number of such ships, said Jaime Katz, a leisure and entertainment industries analyst for Morningstar, an investment research firm. In 2016, for example, Royal Caribbean International plans to build a 5,400-passenger ship.
"The target market for the ultra-luxury segment is much smaller. The lion's share of industry profits come from the broadest segment of the population," said Katz.
Some of the luxurious, small ships are foreign-owned or privately held and do not release financial information publicly, Katz said, so it is difficult to gauge how profitable they may be compared with mass-appeal ships.
The influx of larger ships to Portland is also attributable in part to the opening of the so-called megaberth, a longer pier built to handle cruise liners as long as 1,200 feet. The megaberth opened in September 2011 and additional dredging was done later, after a ship had to leave port early during an unusually low tide.
The biggest ship to visit Portland this year will be Royal Caribbean's Explorer of the Seas, with 3,114 passengers, which is scheduled to visit three times in September.
For 2014, 37 ships have tentatively booked to stop in Portland, with an estimated 71,880 passengers.
Although most of Portland's cruise traffic takes place in September and October as tourists come for foliage season, the city already has seen 13 ships this summer.
Despite news stories earlier this year reporting problems on cruise ships, passengers on the Carnival Glory, which docked Monday in Portland, said they had no fears on board the ship, which began its cruise in Boston and was bound for Canada.
"As many Carnival cruises that there are every year, the percentage of problems is very small," said Bobby Payne of Pensacola, Fla. "We've been on four or five Carnival ships and never had a problem."
"It's not really a consideration for us. I'm not worried about safety," said Denice Smith, from New York state, who was on the cruise for her honeymoon. "It was an easy drive for us to Boston. Just five hours. We didn't have to worry about the cost of a flight."
The industry has seen some highly public black eyes this year, including a fire in May on Royal Caribbean's Grandeur of the Seas, a power loss in March on Carnival's Dream, and a fire in February in the engine room of Carnival's Triumph that stranded the ship in the Gulf of Mexico for several days. The power loss crippled not only the ship's propulsion, but also support systems such as plumbing and cooling systems.
Passengers on board the Triumph reported enduring cold food and unsanitary conditions for the four days before the ship was towed to port. The cruise line saw its stock drop before the company replaced its chief executive officer last month.
"It reminds people that it could be awhile before you get back to land," said Matthew Jacob, a director of ITG Investment Research. "We found that Carnival had to lower summer fares by about 20 percent."
This year's cruise problems, however, were minor compared with last year's capsizing of the Costa Concordia off the coast of Italy that resulted in 32 deaths. That incident had a temporary dampening effect across the entire industry, analysts said. The Costa Concordia's parent company is Carnival Cruise Lines.
"Last year, every cruise line saw a negative effect. But the Costa Concordia was significantly more impactful with a lot of fatalities," Jacob said. He said that cruising still remains relatively safe.
"Before the Concordia, the last big incident for the industry was the Titanic," he said.
Other negative news for the industry in the past year ranged from broad outbreaks of norovirus, which can cause diarrhea, vomiting and stomach pain, to the disappearance of a husband during a Mediterranean honeymoon cruise. In February, 22 passengers of the Carnival Splendor were robbed at gunpoint in Mexico.
But none of these reports stopped Lee Barile of New Jersey, who said she decided to go on a cruise for vacation because she saw it as the most economical and relaxing way to travel.
"The stories of illnesses or crime -- that is what sells stories. It's probably safer than other modes of travel," Barile said.
By bringing ships to small ports such as Portland, the industry can try to attract more consumers by making it easier for them to cruise near home without having to travel long distances just to get to a ship, said Katz.
"The cruise industry is a niche product. There has to be newer ships with a lot more amenities to try to grab a new segment of the population," Jacob said.
The industry's North America cruise line passengers are expected to rise to 17.6 million this year, up from 17.2 million last year, according to the Cruise Line International Association.
There are few reliable statistics on illnesses that occur on cruise ships, since what would be a gastrointestinal disease may be mistaken by some passengers as just seasickness, analysts said.
Cruise ships participating in the vessel sanitation program are required to report the total number of gastrointestinal illness cases evaluated by the medical staff before the ship arrives at a U.S. port when sailing from a foreign port. A separate notification is required when the gastrointestinal illness count exceeds 2 percent of the total number of passengers or crew on board, according to the U.S. Centers for Disease Control and Protection.
About 10.3 million passengers embarked on a cruise ship from a U.S. port in 2012. There were 16 norovirus outbreaks reported to the CDC, involving a total of 2,791 ill passengers, according to the CDC website. That compares with about 20 million norovirus cases in any typical year in the United States, according to the CDC.
Such illnesses are more prone to breaking out in areas where many people share an enclosed space and the same air, which can occur on land as well as at sea. In 2011, the Aria Resort & Casino in Las Vegas had an outbreak of Legionnaire's disease, a sometimes deadly form of pneumonia.
"Think of any enclosed ventilation system," Katz said. "There's a potential for problems."
Jessica Hall can be contacted at 791-6316 or at firstname.lastname@example.org
Correction: This story was revised at 11:51 a.m., July 23, 2013, to give the correct first name for Matthew Jacob, a director of ITG Investment Research.
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Carnival Glory passenger Bobby Payne, of Florida, says he’s taken four or five cruises and never had a problem.
Gabe Souza/Staff Photographer