Royal Caribbean International is placing its biggest bet yet on China as an emerging cruise market.
The Miami-based cruise line announced this week that it will move its new Quantum of the Seas, a 4,180-passenger vessel launching in November, to a new home port — Shanghai — after spending just six months in the New York market.
By adding Quantum of the Seas to a lineup in the region that includes two 3,114-passenger ships, Royal Caribbean is increasing its capacity in Asia by 66 percent. And it is deploying its newest hardware, which includes a simulated skydiving experience, mounted observation capsule, circus school and bumper cars, to a growing market that the world’s largest cruise operators have been working to cultivate.
“This is a bold move,” said Adam Goldstein, president and chief operating officer of parent company Royal Caribbean Cruises Ltd. “It does accentuate what we believe to be the market leadership position that we have created for the Royal Caribbean brand.”
The resulting cruise ship shuffle means a loss for South Florida: Quantum sister Anthem of the Seas, which was scheduled to sail from Port Everglades starting in fall of 2015, will instead be based in Bayonne, N.J. That ship will launch in Europe next spring with voyages from Southampton before heading to the United States.
That means no new Royal Caribbean vessel will even potentially be based in South Florida until at least 2016, when new Quantum-class and Oasis-class ships are due.
During a conference call with Royal Caribbean executives Thursday, Miami cruise expert Stewart Chiron said he was hearing feedback that South Florida “is pretty upset about not having Anthem.”
Lisa Lutoff-Perlo, the cruise line’s executive vice president of operations, compared the South Florida market to fans who grow accustomed to their favorite sports team winning.
“Maybe South Florida’s spoiled, having gotten this amazing hardware for so long,” she said. “They kind of have to share the wealth a little.”
The company will send Navigator of the Seas, an older, 3,114-passenger ship that was recently refurbished, to Fort Lauderdale for Caribbean sailings in the winter of 2015-16.
“China is an emerging market for cruise travel, and the industry will benefit from these new travelers experiencing the excitement and value of cruising,” said Port Everglades Chief Executive and Port Director Steve Cernak in a statement. “Royal Caribbean and Port Everglades enjoy a strong, long-term partnership. We understand that deployment schedules change, and we will adjust accordingly.”
Royal Caribbean last brought a brand new ship to Port Everglades when Allure of the Seas, which shares the designation of “world’s largest” with Oasis of the Seas, debuted in 2010. Both 5,400-passenger ships sail year-round from Fort Lauderdale, though Oasis will head to Europe for a short stint this fall, and Allure will follow for 22 European sailings between May and October of 2015.
“It was actually because we have those ships based in Port Everglades that we are able to expand our deployment more into New York and Southampton and Shanghai with Quantum-class cruising,” Goldstein said. “We need to be present with state-of-the-art capacity in more places than South Florida, but South Florida remains fundamental to our brand and to our company and to the industry.”
Mike Driscoll, editor of the trade publication Cruise Week, said the decision also speaks to the “severity” of pricing in the Caribbean, which has been a struggle for the industry in recent years. Putting brand new capacity in New York will allow Royal Caribbean to command top prices when both ships launch.
“Given what they’re doing, they are going to have incredibly strong rates for both Quantum and Anthem,” he said. “I think on the face of it, it just seems like a very original way to go to market and the way to increase pricing for Royal Caribbean in North America.”
Chiron, CEO of CruiseGuy.com, said Quantum should also perform well for Royal Caribbean in Shanghai.
“The pricing on cruises departing from Shanghai is twice as much as Hong Kong or Singapore,” he said, “and significantly more than they would get here.”
Royal Caribbean said the plan is to source passengers from the Chinese market, which will require some tweaks to retail and casino spaces, galleys and food offerings, and entertainment and crew.
For his part, Chiron called the decision “a great move for the company” — even if it means the product stays out of reach for South Floridians.
“No one here is flying out to Asia to catch a cruise,” he said. “You might as well have put that ship out on Mars as far as the No. 1 cruise market in the world is concerned.”