Cruise lines expected to offer deeper discounts

Royal Caribbean Cruise Lines has revealed that it intends to introduce “aggressive pricing actions” as a means of stimulating forward bookings on its cruises.

January’s peak booking period is producing results similar to the same period last year, but at prices that are “significantly” lower.

Brian Rice, the cruise line’s CFO, commented: “We recognize this will be a very challenging year and do not expect any quick turnarounds in our pricing. Consumers are certainly delaying their purchase decisions, but as they get closer to their vacations, they appreciate a great value and are buying cruises.”

Rice spoke as Royal Caribbean was releasing its profit numbers for 2008, which showed a decline from the $603 million achieved in 2007 to $573.7 million for 2008.

The decline in net profit came even with revenues increasing from $6.1 billion in 2007 to $6.5 billion for 2008.

Royal Caribbean reported that its core Caribbean cruises are experiencing demand that is stronger than seasonal itineraries such as Alaska and Europe.

The cruise operator also noted that the share of its business coming from outside the US continues to increase, but that this “also makes currency issues more relevant to the company’s results”.

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www.royalcaribbean.com