China Cruises Are Packed at Lower Prices Amid Tensions With South Korea
Photo Credit: Royal Caribbean International's Ovation of the Seas is shown in Tianjin, China in 2016. Business has been challenging in China for cruise lines this year, but passengers are still crowding into ships. Royal Caribbean International
Skift Take
An international dispute that forced itinerary changes for China-based cruises threw operators for a loop, but demand seems fundamentally intact. If tensions ease and South Korea reopens, will pricing return to high levels or have lower fares become the new normal?
The promise of China, with its growing middle class and still-healthy economy, looms large for cruise executives, who have invested in a market they believe could become the industry's largest.
But entry into China has not been smooth for cruise operators. Natural disasters, political tensions, contagious diseases, and that age-old problem of oversupply have all shown that patience is required.
"There's been tremendous growth during this period of time, and we're finding that China is starting to behave more like a typical market," Royal Caribbean Cruises CEO Richard Fain said during an earnings call this month. "Most markets have ups and downs, and we've seen both in China."
This year was supposed to allow demand to catch up to supply after massive increases in capacity put pressure on once-stellar prices. Capacity growth was finally tapering off, especially in Shanghai, where the bulk of ships make their homes.
But a dispute between China and South Korea over the deployme
