UBS assesses cruise capacity growth with the Disney ship orders

However, that 4.5% could come down with ship removals.

In a note, UBS analyst Robin Farley said the average rate of removal for the five years prior to the pandemic was 1.2 points, which could suggest the CAGR ends up as 3.3% — below the pre-pandemic increases.

The historic 4.1% CAGR is net, including ship sales and scrapping. (And Farley pointed out that five-year period had above average yield growth of 3%.)

3,000 lower berths assumed for DCL newbuilds

UBS calculations take into account Meyer Werft could be working on a new Disney ship class since DCL said the designs are still in development. So the brokerage assumed 3,000 lower berths for each of the four newly ordered ships, up from the 2,500 now. UBS also assumed about one delivery per year and a mid-year delivery for the first ship in 2027.

Eight-year CAGR

Looking at an eight--year CAGR from 2023 to 2031, UBS put the North American rate at 3.7%, slightly above the 3.6% of the eight-year CAGR pre-pandemic (which, again, is a net figure).

So far, Carnival Corp., Norwegian Cruise Line Holdings and Disney have all ordered ships out to at least 2031, NCLH to 2036.

'So RCL, and possibly MSC, are likely the only large cruise companies that would be ordering ships for the North American market for delivery in ’28-’31 that we don’t already know about today,' Farley said.

If Royal Caribbean orders ... 

She added that if Royal Caribbean Group were to order a ship each year for 2029-2031, that could bring UBS's eight-year CAGR forecast to 4.1% gross and 3% net.