Cruise bookings are on fire -- and it's pushing up prices
We knew cruisers would be eager to get back to cruising when ships finally started sailing again. And now there's proof.
The world's largest cruise company, Carnival Corp., said on Thursday bookings for upcoming cruises soared by 45% during March, April and May as compared to the three previous months as cruisers raced to grab cabins on newly announced sailings for the summer and beyond.
That's on top of a 90% increase in bookings for future cruises during the three previous months as compared to the three months before that.
The numbers were revealed as part of Carnival Corp.'s earnings report for the just-ended second quarter. With very few ships sailing during the quarter, the company posted a $2 billion loss -- one of its biggest quarterly losses in history.
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"This is a clear demonstration of the pent-up demand for cruises as well as the long-term potential for the market," Carnival Corp. CFO David Bernstein said of the surge in bookings during a conference call with Wall Street analysts on Thursday.
Carnival Corp. is the parent company of Carnival Cruise Line, Princess Cruises, Holland America, Seabourn and five other brands that together account for nearly half of all cruises taken worldwide. It's considered a bellwether for the entire industry.
Bernstein on Thursday said the jump in bookings during the second quarter was driven both by close-in bookings for soon-to-depart sailings as well as strong bookings for trips in 2022.
He described the booking volumes as "very strong" and noted the company's overall booking picture for the coming year is now looking better even than in 2019 -- the last normal year before COVID-19 hit.
"Our cumulative advance booked position for the full year 2022 is ahead of a very strong 2019, which was at the high-end of the historical range," he said.
Bernstein noted that the strong bookings were coming in despite minimal advertising and promotional activity in recent months as the line's operations remained mostly shut down.
And the strong bookings are leading to something that might upset some cruisers: Higher prices.
With demand for cruises so strong, Carnival Corp. brands have been able to hold the line on pricing and even raise pricing in some situations, Bernstein said.
"Pricing on our full-year 2022 booked position is higher than pricing on bookings at the same time for 2019 sailings," he noted.
"This is a great achievement given pricing on bookings for 2019 sailings is a tough comparison, as it was a high watermark for historical [pricing] yields."
All nine of Carnival Corp.'s brands halted departures in March 2020 after the COVID-19 outbreak was declared a pandemic and many of them have not operated a single voyage for 15 months. But with COVID-19 vaccination rates growing and case counts falling in many countries, and many destinations lifting travel restrictions, many of Carnival Corp.'s brands are in the midst of resuming departures.
As of Thursday, Carnival Corp.'s nine brands together had just five of their 90 ships operating with paying passengers in various parts of the world. But that number is expected to grow to 42 ships by the end of November as more vessels come back online, the company said.
Carnival Corp. CEO Arnold Donald said during the conference call that the company hoped to have all of its ships back in operation by the summer of 2022.
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