Greece, China Financial Woes Could Hit Cruise Industry Hard
say financial troubles afflicting Greece and China could have a serious impact
on the cruise industry.
Greece exits the European Union, travellers “could choose to avoid the country
for fear of being exposed to social unrest and having a poor travel
experience,” according to an article on TheStreet.com.
Greece becomes a harder sell, cruise lines like Carnival and Royal Caribbean
may be forced to discount.
if Greece leaves the European Union, the resultant European economic downturn
may lead Europeans to defer their holidays. This, coupled with a move by North
Americans away from visiting Greece, could impel cruise lines to delay building
new ships for the European market. Profits would be hurt as projects sit in
5.85 million pax embarked on cruises from European ports in 2014, a 3.6% drop
on the previous year’s total. And according to one cruise executive, Greece is
already impacting the cruise industry.
Street.com report quotes Carnival Chief Financial Officer David Bernstein saying
“geopolitical risk” in Greece and overall economic weakness in Europe has led
to “some challenges on the yield side this year.”
troubles in China pose challenges for the cruise biz as well. The big threat is
that current problems hitting Chinese equities could cause rich Chinese to put
off taking a cruise this year and in 2016 “just as the cruise line companies
are devoting their newest ships to the region.”