Summary
Prices are being drastically reduced on cruises for 2009 Bookings are down for the wave season signaling trouble ahead Cancellations are up and the booking window is getting very close in
Analysis
Carnival and Royal Caribbean Cruise Lines have started lowering prices on all 2009 cruises. Rates are at their lowest point since after 9/11/01.
Bookings have been less than stellar so far for the all important "wave" season or first quarter of 2009. Their only alternative will be to continually drive prices down to spur new business. The cruise industry has weathered recessions before, but this time the length of the downturn seems like it will be a long one. Many new promotions are being brought out such as reduced deposits, changes in cancellation schedules, and other bold offers like paying higher commissions even on port charges and taxes. Thus far these attempt have brought a ripple to the wave season, but sales are not nearly where they should be for this time of year. With less money in circulation, the onboard spending figures will most likely be much lower than normal for cruise passengers. Net yields for 2009 will most likely be at all time lows. With an increase of 5% in capacity coming online in 2009, this signals trouble ahead on the high seas, for cruise operators.
