Cruise discounts cut as outlook improves

March 18, 2010, 2:05pm

MIAMI, March 18 (Reuters) – The world's biggest cruise lines have seen strong advance bookings so far this year and are paring away discounts that lured passengers aboard during the global economic crisis, their chief executives said.

But none expected an immediate return to the revenue yields they enjoyed before the crash.

And while new ship orders have resumed after a record 20-month drought, the CEOs expected the pace of new shipbuilding to remain slow for the next couple of years.

The mood at the annual Cruise Shipping Miami conference was decidedly brighter than it was in 2009, a year Norwegian Cruise Line Chief Executive Keven Sheehan described as ''scary.''

''We're seeing solid signs of recovery, albeit one that will play out over the next couple of years,'' said Sheehan, whose line is jointly owned by two US private equity firms, Apollo Management and TPG, and by Genting Hong Kong Ltd, which was formerly known as Star Cruises Limited.

Major lines cut ticket prices by 10 percent to 20 percent in 2009 as consumers kept purse strings tight.

That lured vacationers aboard and filled the ships with 13.4 million passengers, up by 430,000 passengers from 2008, according to the Cruise Lines International Association.

But net yields, a measure of revenue generated per bed per day, were down 16 percent during the first nine months of 2009, before starting to rebound at the end of the year.

Several CEOs said they had seen strong advance bookings during the crucial January-through-March ''wave season,'' which is when many travelers start planning vacations and is traditionally the industry's busiest booking period. Bookings were solid enough for some of the big players to raise rates. Carnival Cruise Lines, the flagship line for No.1 cruise company Carnival Corp, is raising rates by up to 5 percent for summer sailings, effective March 22.