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As fuel costs rise, cruise lines scramble

Posted by Anita Dunham-Potter On September - 25 - 2006

We all know what the soaring cost of fuel has done to the airline industry. Now the problem is hitting the cruise industry, especially the giant cruise lines, like Carnival Corporation and Royal Caribbean Cruises International, who together comprise approximately 75 percent of the worldwide cruise-ship fleet. Carnival saw its fuel costs increase 33 percent last year; Royal Caribbean’s bills rose 25 percent — not surprising when you learn that their ships carry in the neighborhood of 3,000 metric tons of fuel.

Smaller cruise lines like Oceania and Silversea are less susceptible to fuel cost increases because they operate smaller ships and offer longer port times, so they spend less time cruising and burning fuel. But they are all feeling the pinch. Some cruise lines are balancing the books by adding fuel surcharges to their passengers’ bills; all are working harder at fuel conservation.

Just what does this mean for the cruise traveler? It all depends upon which cruise line you sail on.

Fuel surcharges

Four cruise lines — American West Steamboat Company, Crystal Cruises, Regent Seven Seas Cruises and Costa Cruises (European sailings only) — have imposed fuel surcharges for the 2006 season. These surcharges range between $2 and $12 per person per day. As for the 2007 season, there are mixed reports.
* Crystal Cruises has stated that the surcharge will remain in effect indefinitely.

* Costa Cruises says its surcharges will remain in effect through November 2006 and further surcharges have not yet been decided.

* American West Steamboat Company, which was recently merged with Delta Queen Steamboat Company to form Majestic America Line, says no decision has been made for the 2007 season.

* Regent Seven Seas spokesman Andrew Poulton says he does not expect fuel surcharges to be levied for the 2007 cruise season as Regent has already factored the elevated fuel costs into next year’s fares. But, he adds, “If there is a dramatic increase in the cost of fuel, we would have to reconsider.”

Fuel conservation

With fuel prices on the rise, most cruise lines are looking at fuel conservation measures. Some lines are changing their routes and schedules. For example, Carnival has cut the far-flung southern Caribbean islands of Aruba, Barbados and Martinique from its Carnival Destiny and Carnival Legend itineraries for the 2007 season. Instead, the ships will visit St. Kitts, St. Lucia and St. Maarten, islands whose closer proximity requires less sailing time and therefore less fuel. Carnival says the changes offer significant fuel savings. Other cruise lines have adopted earlier departure times that allow the ships to cruise more slowly and burn less fuel. The downside to this change for the consumer is less time in port.

During the Pride of Hawaii inaugural sailing in May, I asked Norwegian Cruise Line’s President and CEO Colin Veitch a few questions about fuel conservation. Veitch said the line relies heavily on navigation software to plan out voyages that maximize fuel efficiency. This includes not only navigational plotting but engine speeds as well. He said the cruise line is also working on automated climate control in passenger cabins using a sensor technology that can adjust temperatures according to whether the cabin is occupied or unoccupied.

On the newest ships on all cruise lines, passengers will notice more targeted climate-control operations in the cabin, many of which are now zoned to heat or cool a specific area. And all new-built and recently refurbished ships are equipped with flat-screen televisions, which save a lot of energy.

At Celebrity Cruises, President Dan Hanrahan says the company is looking at all conservation ideas, right down to replacing many standard lights with LED lights. So far, he says, the company has not found an LED light that can fit all its needs.

Princess Cruises and Holland America Line are exploring an entirely different tactic that will not only save fuel but also curb engine air emissions: tapping into local shore power. While docked in a partner port, retrofitted ships are “plugged in” to the electricity provided by the host city’s hydroelectric plant. The approximate cost for shore power is $5,000 each time a ship plugs in — much less than it would cost to generate electricity burning fuel in the ship’s engines. Both Princess and Holland America are currently tapping power in Seattle, and Princess is also tapping power in Juneau.

Then there are simple things cruise lines do to save fuel, including using fewer lights, tinting windows and painting the ship’s hull with a special paint that prevents sea organisms from adhering to the ship and slowing it down.

So what does all this mean for you, the cruise consumer?

If fuel prices continue to skyrocket and eat away at profits, cruise lines may have no choice but to impose fuel surcharges or raise cruise fares. It goes without saying: Any conservation on the cruise industry’s part can keep cruise fares more affordable for all.

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