Cruise lines forecast big boost from Cuba

Cuba is expected to boost demand for Caribbean cruises overall

It won't be easy, but cruises to Cuba could provide a 20 percent boost to the industry once they're finally allowed, a panel of cruise leaders says.

The heads of four major cruise companies, speaking Tuesday in Fort Lauderdale, all said that Cuban ports present challenges in infrastructure and that Cuba has been slow to approve visits from ships. But the island holds tremendous potential as a cruise destination, they said.

"What [Cuba] will do, and it's already doing in some sense, is create a halo of interest, and as people start to go and talk about Cuba, I think it will raise the Caribbean in total," said Richard Fain, chairman and CEO of Royal Caribbean Cruises Ltd. "It adds 2 percent or 5 percent to the supply of places to go, and it will add 10 percent to 20 percent to the demand for cruising."

Fain was part of a panel of cruise executives at Seatrade Cruise Global, the industry's biggest annual conference and trade show. He was joined on the panel by Arnold Donald, president and CEO of Carnival Corp. & PLC; Frank Del Rio, president and CEO of Norwegian Cruise Line Holdings Ltd.; and Pierfrancesco Vago, executive chairman of MSC Cruises.

CBS News Travel Editor Peter Greenberg moderated the panel.

"Cuba is a great opportunity for us in the cruise business because we bring our own hotels and our own infrastructure, and it's a great opportunity for the Caribbean as well as relates to cruising," Fain said.

Donald has his fingers crossed that the company's newest cruise brand, Fathom, will soon receive approval from Cuban authorities to begin cruises there from Miami in coming weeks.

"We're anxiously awaiting [approval]," Donald said. "We're doing everything that they've asked us to do, so we're optimistic that come May we'll be sailing."

Others say problems with infrastructure won't deter them from wading in once Cuban approval is granted.

"Havana is not at the bottom of the list in terms of infrastructure," Del Rio said. "In time, infrastructure will improve, but Havana today is ready to take our ships," the Cuban-born Del Rio said.

MSC Cruises has a ship based in Havana this winter for non-U.S. travelers — the 2,120-passenger MSC Opera. MSC says that working with Cuban authorities on requirements for arriving and departing travelers is a challenge.

"Cuba is very complex," Vago said, referring to moving people and luggage between airport and port.

The cruise line's talks with Cuban officials on its port requirements will help pave the way for other major cruise lines, Vago said.

In December 2014, the Obama administration began easing restrictions for Americans to travel to Cuba under new U.S. regulations, but it still remains limited to 12 approved categories, such as educational and religious activities, family visits and humanitarian projects.

Since then, both U.S. and Cuban authorities have agreed in principal to the resumption of commercial flights between the two destinations, and the U.S. is expected to approve airline routes in coming months.

On Tuesday, the federal administration said Americans can now take individual people-to-people trips to Cuba rather than travel in organized groups. It also will allow the use of American dollars for more transactions.

On other discussion topics, the panel:

•* Talked about how their respective brands and companies are innovating, listening to customer feedback and focusing on unique differences to improve shipboard offerings, boost customer satisfaction and attract more people to cruising.

• Discussed industry growth in Asia, especially China, where most of the growth will take place in the foreseeable future. In 2015, China had 135 million outbound tourists, making it the largest outbound tourist nation in the world, Donald said. He also mentioned the growing popularity of fly and cruise options among the Chinese, particularly on Australian itineraries

• Agreed that they'll need to take a more measured approach to building new ships. There are only a few shipbuilders worldwide, and they're full with current orders. Still, new ships are necessary for cruise companies to enter new markets like China as the industry grows.

asatchell@sunsentinel.com, Twitter@TheSatchreport

Copyright © 2017, CT Now
41°