One cruise line heading back to New Zealand is sailing out of the pandemic and into record demand as the industry gears up for a strong summer recovery.
Norwegian Cruise Line (NCL) is still being buffeted by some other geopolitical events – including the Russian invasion of Ukraine - but the Miami-based company has just enjoyed the best quarter for bookings in its 55-year history.
In its latest quarterly figures, NCL says advance ticket sales of US$2.5 billion ($4.1b) were a record. While it continues to make quarterly losses, pricing is "significantly higher" than before the pandemic.
Demand is back across an industry that was dead in the water for close to 18 months around the world and longer in this country. In New Zealand, cruise ship visits this summer will approach pre-pandemic numbers, with total port calls as of late August at 915 from 43 ships. The last full cruise season in 2018/19 saw more than 1000 port calls.
One cruise line new to this region, Disney, is also heading our way. And while critics question the value of cruise tourism, pre-pandemic it was worth $547m a year, according to the NZ Cruise Association.
And now a dedicated cruise terminal for Auckland is back on the radar, a development welcomed by the industry, which believes in the "build and they will come" strategy.
While some European cities push back against mega-ships in their ports, since dropping border restrictions the New Zealand Government has warmly embraced the cruise industry, and ship visits over summer will be a boost to Auckland's downtown area which suffered badly through prolonged lockdowns. The return of tourists - from a low base - helped New Zealand avoid a recession in GDP data released this week.
But early in 2020, things were very different for cruise companies. Norwegian Cruise Line boss Harry Sommer recalls how just three months into the job, he had to suspend the operation.
The pandemic hit the cruise industry harder than any other sector, with Covid outbreaks at sea making headline news. The date when NCL put the jobs of more than 30,000 staff on hold is etched in his memory.
"We shut down on March 13, 2020, the date is seared in my mind," said Sommer during a christening cruise on the company's newest ship, the Norwegian Prima.
It took more than a week to get thousands of guests home and two to three months to get all the crew back to more than 70 countries.
"The crew are the lifeblood of the company."
Frank Del Rio, president and chief executive of the NCL group – which includes Oceania Cruises and Regent Seven Seas Cruises – said he was "excited and emotional" at the big christening ceremony for Prima in Reykjavik, Iceland.
"Collectively we experienced one of the most difficult periods we'll ever face in our lifetimes, those involved in the cruise business certainly did," he said before a non-revenue cruise carrying company executives, suppliers, bankers, entertainers including Katy Perry, travel agents and journalists.
"We all missed it, it was a terrible period of time but we're back, we're all here because we had that grit and perseverance to get back to normal again."
Del Rio said the return to normalcy and pent-up demand coincided with the build-up of the company's fleet, headlined by the Prima-class programme. Six of the 143,000-tonne ships will be delivered during the next five years, a US$5.5b ($9.2b) programme.
He said while the timing of the building programme may not have been so good two years ago, that timing was good now.
The building of Norwegian Prima, a high-tech new-generation ship, during a pandemic showed much resilience and fortitude.
Sommer said Italian shipyard Fincantieri achieved an enormous feat.
Italy was Ground Zero early in the pandemic but closed completely for just six weeks, and with Covid testing and other health measures, thousands of workers were able to deliver the ship just about bang on time.
During the latter stages of the build, Russia's destruction of Ukraine's Mariupol steel plant was also a problem. Steel for the ship came from there, so alternative sources were found for Prima and its sister ship. Many components were manufactured in Romania and transport problems as a result of the invasion also hit the shipbuilder.
"I could go on about the challenges - it was just a few days late … but I think it was an enormous feat," said Sommer.
While there are no immediate to deploy Prima-class ships in this region, it is possible in the future. The cruise ship choke point at Sydney's Circular Quay is a barrier for the big ships, which are unable to get under the Sydney Harbour Bridge to alternative berths.
Instead, this summer NCL is sending its Norwegian Spirit, which has undergone a $160m bow-to-stern refurbishment.
Speaking late last month Sommer, who is president and chief executive of NCL, said that with current trends the full 2023 year is on track to be a record for bookings. And job security among customers was helping drive that, in spite of high global inflation.
"We're not assuming a huge inflationary number in terms of pricing and planning, we'll see what happens but I don't think it's a long term issue," he said.
"The employment market continues to look outstanding in most markets that we source our guests from."
According to AP reports, Shipping emits about 2.9 per cent of global carbon dioxide emissions, just over a billion tons of CO2 annually, and cruise ships produce more carbon dioxide annually on average than any other kind of ship due to their air conditioning and other hotel-style facilities.
Sommer said his company was acutely aware of the challenge.
It is undertaking a study on potential alternative ways of powering the final two Prima ships, instead of heavy marine fuel which makes up about 9 to 12 per cent of running costs.
Other cruise companies were investigating using liquefied natural gas (LNG).
"I don't know that LNG is the answer, it's still a fossil fuel that is difficult to make on a sustainable basis."
Cruise companies are also investigating hydrogen, methanol and ethanol to power ships.
Just like aviation, the industry needs an environmentally friendly alternative fuel as a game-changer to meet emissions targets. Sommer said NCL is committed to be a zero greenhouse gas emitter by 2050, but has measurable goals on an annual basis.
It is working with other cruise lines on alternative fuel sources.
Ben Angell is vice-president and managing director of NCL in this region and said the fly-cruise market from Australia and New Zealand was booming.
He said the company wasn't in the business of being a domestic cruise line.
"We source guests from Australia and New Zealand who wish to cruise in Europe, Alaska and Hawaii. Typically they've cruised before so we're not typically in the business of attracting first-time cruisers."
Asked when Prima-class ships would be seen in this region, he said with six of them planned, this region was "an increasing part of our consideration as the fleet grows".
Since the resumption of cruising, many restrictions about vaccination and mask wearing had gone around the world or are on the way out.
There are more multi-generational groups now, with families making the most of being able to spend time together.
• Grant Bradley was a guest of NCL aboard the Norwegian Prima
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