Royal Caribbean will be one of the first Western travel brands to return to China. The fact that bookings look healthy there point to strong cruise demand in the country.
Royal Caribbean executives are seeing signs of strong demand for cruise experiences in China as they prepare for their return in April 2024.
“We’re feeling quite optimistic about the China product,” said Royal Caribbean International President and CEO Michael Bayley. “We have a China product Spectrum sailing on Shanghai in April next year, so far the bookings by volume and rate are very good, much better than our 2019 performance, which was a record performance for the brand.”
About 1.5% of Royal Caribbean’s capacity in the fourth quarter had been planed for Israel. All itineraries in the region for the year have been canceled or adjusted due to the ongoing conflict.
Bookings remained strong throughout the third quarter, significantly exceeding 2019 levels. Rates reached new highs and the booking window has extended. Demand for 2024 has continued to accelerate, with bookings outpacing 2019 levels.
Here’s what else you need to know about Carnival’s third-quarter earnings call:
- Customer spend on onboard experiences is up 25% over 2019. Spending on goods was twice what it was in 2019.
- Pre-cruise purchases continue to rise. Pre-cruise purchases cover onboard activities and goods paid for before the trips. “As we look to 2024, we have booked double the amount of pre-cruise revenue compared to this year with more guests engaging before their cruise and at higher prices,” said Royal Caribbean Group CEO and President Jason Liberty.
- No expected slowdown in consumer spending and bookings. Ongoing macroeconomic trends won’t deter Royal Caribbean customers because they have a median household income of $125,000, surplus savings and “elevated wealth levels” as well as there being a strong job market and high wages, said Liberty.
- Capacity will grow by 8% in 2024. Royal Caribbean will launch three new ships next year.
- Israel will account for less than 1.5% of capacity next year.
- Total revenue for the quarter was $4.2 billion. Net income for the quarter was $1 billion.
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