WHITE PAPER

2012 OUTLOOK FOR

NORTH AMERICAN CRUISE INDUSTRY
October 2011






Prepared by:

Christine Duffy, President and CEO
Cruise Lines International Association






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2012 OUTLOOK FOR NORTH AMERICAN CRUISE INDUSTRY
By Christine Duffy, president and CEO, Cruise Lines International Association (CLIA)

Approaching the end of 2011, the North American cruise industry, as represented by the
26 member lines of CLIA, is well-positioned for continued growth and success. Like
other travel industry segments, it was not immune to the economic challenges but, has
proven to be resilient over the last two years. Innovative marketing strategies, an
unwavering commitment to investment in new ships, itineraries and shipboard
experiences is the driving force behind continued consumer interest in cruising. CLIA
member ships sailed at 100+ percent occupancies throughout the recession period.
Results for 2010 and tracking thus far in 2011 points to a continued positive outlook
going into 2012.

In 2010, CLIA member lines, operating collectively at 103.1 percent occupancy, carried
14.8 million passengers, an annual increase of 10.3 percent. U.S. residents topped the 10
million mark for the first time. The North American cruise industry generated 329,943
jobs, a 5.1 percent increase over 2009, contributing a $15.2 billion wage impact. Direct
expenditures with U.S. businesses increased by 5 percent to $18 billion. The industrys
total economic impact in the U.S. was $37.85 billion of gross output, a 7.8 percent
increase, despite continuing global economic challenges. Over the past decade the cruise
industry has consistently outperformed the national economy and the travel and tourism
sector in particular.

Based on these results, CLIA forecasts 16 million passengers for 2011, including 11.68
North Americans, or 73 percent of the total.

This optimism is also based on current consumer attitudes and trends. According to
CLIAs 2011 Cruise Market Profile Study, 36.1 million Americans from a core target
market of 133 million express an interest in cruising within the next three years, up from
31 million in 2006. Overall satisfaction rates are 94 percent and, compared to other types
of vacations, cruising is among the leaders in extreme satisfaction at 45 percent. While
73 million Americans have already cruised, 40 percent of respondents to the 2011 survey
claimed that their last cruise was their very first voyage, a strong indication that the
industry continues to attract large numbers of new guests.

There are several factors that will continue to contribute to the cruise industrys growth in
the years to come. These include the cruise lines continuing investment in the future
through new cruise itineraries, ship board and shoreside experiences, and new ships,
backed by an industry commitment to grow responsibly, exploring opportunities
maximize sustainability. The cruise lines commitment to providing high value across all
price categories of cruising is an important element as well. In addition, the industry is
dedicated to implementing successful strategies for stimulating consumer interest and
demand, by investing in developing and educating the next generation of cruise sellers
through a wide variety of partnerships and alliances.
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Since 1980, the average annual passenger growth rate for CLIA member lines has been
more than 7.5 percent driven by the ability to fill a steadily increasing number of ships. In
2010, 12 ships representing an investment of $5.9 billion and ranging in capacity from
101 passengers to 5,400 passengers joined the CLIA fleet. Between 2011 and 2012, an
additional 24 ships are on order. These include:
Carnival Cruise Lines Carnival Magic (3,652 passengers) and Carnival Breeze
(3,690 passengers
Costa Cruises Favalosa (3,502 passengers) and Fascinosa (3,012 passengers)
Celebrity Cruises Silhouette (2,850 passengers) and Reflection (3,030 passengers)
Disney Cruise Lines Dream (4,000 passengers) and Fantasy (2,500 passengers)
MSC Cruises Divina (3,502 passengers)
Oceania Cruises Marina (1,250 passengers) and Riviera ( 1,260 passengers)
Seabourn Cruise Lines Quest (450 passengers)
Pearl Seas Cruises Pearl Mist (210 passengers)
Avalon Waterways Panorama (166 passengers), Vista (166 passengers) and
Visionary (126 passengers)
AMA Waterways Amalotus (124 passengers), Amaverde (162 passengers),
Amakaterina (212 passengers) and Certo (164 passengers)
Uniworld Grand Boutique River Cruises Douro Spirit (128 passengers), SS
Antoinette (164 passengers) and River Victoria (206 passengers)
American Cruise Lines will unveil a new paddlewheeler in 2012

Fleet additions between 2010 and 2012 represent a net fleet capacity increase of 17.4
percent, or 51,306 beds.

The diversity of new ships in size, character and purpose demonstrates the industrys
ability to provide the broadest range of vacation experiences. But, while new ships
generate tremendous media interest and consumer enthusiasm, they are not the only
innovations that will drive the industrys growth. CLIA member lines continue to be
adept at responding to consumer interests and expectations and even shaping them.

In late December, 2010 CLIA surveyed its cruise line members to determine 2011 trends
and compared them to the predictions made by CLIA member travel agents. Both groups
agreed that among the hot destinations of 2011 will be all regions of Europe, including
European rivers, which are currently enjoying increasing consumer interest through a
new CLIA product category, river cruising, as well as the Caribbean, South America,
Asia, and the Pacific.

Other trends reported by the cruise lines include:
Globalization of itineraries, including shorter cruises in Europe and elsewhere
Increased choice in dining experiences, with more specialty restaurants, guests chefs
and local sourcing of food
Continued evolution of onboard spas, including top-branded spa partners
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A focus on personalized cruise experiences both onboard and on shore, with private
or exclusive shore excursions, activities targeting specific demographics, including
families, children, sports, active vacationers and special interest itineraries and
programs
Strong interest in theme cruises, particularly food and wine, music, culture and art
Passenger growth among baby boomers, families/multigenerational groups, first time
cruisers and corporate/meeting groups

These trends are already reflected in new cruise ship design, a new generation of
shipboard activities and amenities, new itineraries and ports in all parts of the world, and
greater access to cruising for North Americans, with over 30 domestic ports of
embarkation.

Finally, CLIA and its member cruise lines are taking steps to develop the next generation
of cruise sellers and thus strengthen the industrys opportunities to succeed in the future.
Working with leading educational institutions, like the University of Phoenix, travel
organizations, like the American Society of Travel Agents, and other partners, the
industry is providing travel agents and other sellers of travel the travel professionals of
the 21
st
century with all the necessary tools, skills, information and experience to
succeed in an increasingly complex, rapidly changing and technological competitive
environment.