Published on 13 May 2023

Singapore cruise demand stays strong as fly-cruise visitors return on reopened skies

SINGAPORE'S cruise industry is seeing strong demand even as air travel resumes, with interest from younger passengers and the return of visitors who fly here for cruises, said industry players.

In 2022, Singapore saw close to 1.2 million cruise passengers, according to Singapore Tourism Board (STB) data. This remained short of the 1.8 million passengers in pre-pandemic 2019, but was up from 723,799 passengers in 2021 and 409,564 in 2020.

"The cruise industry is on a strong growth trajectory, and we expect more cruise lines to deploy bigger ships and include the region in their sailing itineraries," said STB's director of cruise Jacqueline Ng. For example, Disney Cruise Line will homeport a new cruise ship exclusively in Singapore from 2025, as part of a five-year collaboration with STB. It is expected to be the largest cruise ship calling here.

Monthly passenger volume at Marina Bay Cruise Centre Singapore has already recovered beyond pre-pandemic levels. From January to March 2023, the cruise terminal handled a monthly average of 27 ship calls and 157,856 passengers – exceeding the monthly average of 24 ship calls and 143,857 passengers across February 2019 to January 2020. But for Singapore Cruise Centre, which handles smaller ships, passenger volumes across January to March 2023 were back to only 35 per cent of pre-pandemic levels. Said chief executive Jacqueline Tan: "We have observed that cruise ships that have called on us are not yet operating at optimal capacity, but (this) is expected to improve over time."

Resorts World Cruises (RWC) and Royal Caribbean International – the only two cruise lines with year-round homeports here – said they continue to see high demand in Singapore. RWC was launched in June 2022, after air travel had begun to resume. Its Singapore sailings in the past year were "almost full", said president Michael Goh. For 2023, its May and June sailings are nearly sold out. Royal Caribbean has seen "extremely strong" demand for its 2023 and 2024 seasons on its Spectrum of The Seas ship, said Angie Stephen, vice-president and managing director of Asia-Pacific. She added that sailings from Singapore during peak holiday periods have been selling out "well in advance".

Like other travel segments, cruises are experiencing a surge in revenge travel and pent-up demand, observed Christopher Khoo, managing director of hospitality consultancy MasterConsult Services. But he noted that headwinds such as the prevailing weak economic outlook, high inflation, interest rates and future geopolitical tensions could point to a "cautious outlook" for this year and the next.

New cruise converts

"Cruises have captured a new wave of interest in recent years, winning over first-time cruisers in Singapore who did not consider cruising as a leisure option before the pandemic," said STB's Ng. "These new cruisers, as well as repeat cruisers, have supported a strong rebound for Singapore's cruise industry as ports reopen and port calls resume in South-east Asia," she added. When Singapore's borders were closed at the height of Covid-19, cruises were the only options for getaways. In end-2020, Royal Caribbean and Genting Cruise Lines offered round-trip cruises to nowhere, under a "safe cruise" pilot scheme by STB.

But even as air travel progressively resumed, interest in cruises persisted. In the last two quarters, up to 60 per cent of passengers handled by Marina Bay Cruise Centre Singapore were first-time cruisers, said Lionel Wong, CEO of the terminal's operator SATS-Creuers Cruise Services. "This suggests that cruising has become established in the minds of travellers as a viable leisure and vacation option, even as air travel resumes and other ports reopen," he said. The pandemic may have especially spurred demand from a younger demographic.

In 2022, Royal Caribbean saw a "significant increase" in the share of its passengers who were couples aged below 30, compared to 2019, said Stephen. In 2023, the proportion of guests younger than 30 remains on the rise. Having similarly seen a wider and younger demographic of passengers, RWC is tailoring onboard activities for young couples, young families and young working professionals.

More demand for fly-cruise, luxury experiences

Rather than competing, air travel supports cruise demand by facilitating fly-cruises, in which passengers fly to Singapore to begin a cruise here. In 2022, Singapore received over 460,000 foreign cruise passengers – around 37 per cent of the 2019 figure. Said STB's Ng: "We expect the number of foreign passengers to return to pre-Covid levels with the return of air travel." Before Covid-19, about 70 per cent of Singapore's cruise passengers were foreign fly-cruise visitors, estimated Kevin Wee, senior lecturer at the Nanyang Polytechnic's School of Business Management. Both RWC and Royal Caribbean have seen rising demand for fly-cruises, mainly from regional markets such as China, India, Malaysia, Indonesia and Thailand. Foreigners now comprise about half of Royal Caribbean's passengers for its Singapore sailings, said Stephen. Longer multi-destination itineraries have attracted visitors from further abroad, such as Australia, Europe and the United States.

In the wake of the pandemic, there is also a greater willingness to spend on luxury cruises and premium experiences onboard, said industry players and watchers. At Royal Caribbean, for instance, bookings for suites doubled in 2022 compared to 2019STB's Ng noted that while existing cruise lines still appeal to "mass market" segments such as young families, "there has been increasing demand from affluent cruisers who are willing to spend more on more exclusive and intimate sailing experiences on luxury cruises". In August 2022, STB inked a three-year partnership with luxury cruise line Silversea Cruises, which will see the latter's ships seasonally homeported in Singapore till 2025.

Cruises with holistic wellness offerings could become a bigger draw, said Wong King Yin, senior lecturer in marketing at the Nanyang Technological University's Nanyang Business School. Said Dr Wong: "Cruise consumers are interested in wellness, so cruise vacations that can offer high-quality healthy foods, fitness amenities, wellness services such as spa, meditation or even cooking classes would be more popular."

Source : The Business Times