Last year, the river cruise industry, like everyone in the industry, admittedly started getting a little nervous. After several years of insatiable growth and a shipbuilding boom that saw individual companies adding up to two ships a year in Europe, for the first time, doubts started to set in.
“Absolutely, there are always doubts when you look at what you were looking at 12 months ago,” said Patrick Clark, president of Avalon Waterways, one of the more aggressive ship-ordering companies of late. Avalon introduced two newbuilds in 2009 and has two more coming on in 2010, ships that were contracted well before the economic crisis.
“With the two that we’re launching in 2010, that adds 30% in terms of berths,” said Clark. Avalon’s total fleet size will be 10 after the two ships launch this year. And while a year ago, that additional capacity coming on would have made any river cruise operator nervous, demand is returning just in time to fill the extra ships.
“Right now, if you look at the U.S. volume, we have literally doubled the number of passengers that we have on the books for 2010 compared to a year ago,” Clark said. Consequently, now “the commitment [to building new ships] is really being rewarded.”
Not that 2009 was all that bad — operators reported load factors up into the 90% range for the year, stimulated by aggressive discounts — but you can hear a virtual sigh of relief sweeping across the river cruise industry as demand starts to return.
“Currently, until July 1, we are 92% full,” said Rudi Schreiner, president of AMAWATERWAYS. “Until November, we are currently 84% full. We are really expecting to fill the ships close to capacity.” AMA added two ships in 2009 and is adding another ship in 2010, which will be devoted primarily to the Australian market and will bring the company’s fleet size to 11.
The bottom line, Schreiner said, is that despite the challenges and the added capacity, “Last year, we had an increase of 37% actual passengers over 2008.”
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