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North America on upswing, South America a challenge

North America on upswing, South America a challenge

Popular North American destinations of Alaska and Bermuda are on the upswing this year, but South America, despite tremendous sourcing potential and rich cultural history, remains a challenge according to panelists on The State of the Cruise Industry: North and South America panel at Cruise Shipping Miami.

Cuba, with its potential appeal as a new Caribbean destination, was also a theme of the session.

Royal Caribbean’s recent decision to send its 138,000gt, 15-deck Explorer of the Seas to Alaska in 2016 signals a high demand and newer, larger vessels—such as Holland America’s mid-sized Amsterdam, also deploying to Alaska next summer—in the 49th state.

‘We’re excited about Alaska. Still the best way to see Alaska is on a cruise ship,’ said Orlando Ashford, Holland America Line’s new president.

‘Alaska and Europe kind of ebb and flow,’ added Lisa Lutoff-Perlo, president and ceo, Celebrity Cruises. ‘This is Alaska’s year.’

Princess Cruises’ ‘long-standing love affair’ with Alaska includes five Princess-owned lodges that offer longer stays. While larger ships could be added, Princess is at ‘a really good size right now,' said Jan Swartz, president, Princess Cruises.

Bermuda also is well positioned for measured growth with newer ships and increased exposure with the upcoming 2017 Americas Cup. ‘Bermuda is very special; a perfect destination for the America’s Cup,’ Lutoff-Perlo said.

Moderator Anne Kalosh, US editor of Seatrade Cruise Review and Seatrade Insider, asked how much preparation will be needed to add Cuba to itineraries, but executives were cautiously vague, citing undetermined infrastructure needs.

But they are optimistic about Cuba: A new Caribbean call means that other island destinations will need to improve their destination offerings.

‘All of it (Cuba’s infrastructure) is limited. You can’t just go there and look around now,’ Lutoff-Perlo said. ‘Cuba has a mystique about it. Once it happens, it will go a little crazy.’

Added Swartz: ‘There’s a lot of North American interest in Cuba, but we have to execute it operationally and seamlessly.’

Roberto Fusaro, managing director, South America, MSC Cruises and chairman, CLIA-ABREMAR, meanwhile, pointed out that MSC has no ships in Cuba, even though it could deploy a vessel there.

‘The Bahamas may be directly challenged in three- and four-day markets,’ Fusaro predicted.

South America—because of chaotic politics and economies and labor issues that impact logistics—remains a challenge as lines strive to build scenic, culturally enriching experiences.

‘If we could get all of the countries of South America to talk with us, I think it would be quite beneficial,’ Lutoff-Perlo said. ‘We haven’t gained traction … We haven’t seen the light at the end of the tunnel.’

Added Fusaro: ‘Despite very strong demand, we see that South America is coming down.’

Kalosh asked about viability of new homeports, including Mexico’s Puerto Peñasco, or Rocky Point.

‘Only time will tell,’ Lutoff-Perlo said, while Ashford dodged the question: ‘We seem to be positioning quite well out of San Diego.’

Puerto Peñasco, in Mexico’s Sonora state, is being built to attract future markets out of the US West Coast. It plans an 880mtr, 13mtr deep protection dock, with capacity for up to three ships.

Other destinations discussed were the US West Coast, Canada and New England, likely to remain seasonal; the Panama Canal, Central America and Pacific Coast countries of Ecuador, Peru and Chile.

Panelists offered advice for destinations that are eager to lure lines.

Ashford, emphasizing a long-time Carnival Corp. theme, stressed ‘consistency’ and the need to ‘exceed guest expectations.’

Minimize political red tape and corruption, Fusaro advised. ‘Make sure your national government doesn’t change the rules every day. We need to know what the rules are.’

Marketing an appeal to consumers is crucial to demand, Swartz said. ‘We go where guests want to go.’

Added Lutoff-Perlo: ‘We have brought millions to parts of the world. We have to make sure the experience is wonderful.’

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