Royal Caribbean International made a significant move by restarting cruise operations in China in April. The deployment of the Spectrum of the Seas from Shanghai marked a pivotal moment for the group’s flagship cruise line. With Covid-era precautions easing in the most populous country in the world, cruise lines saw an opportunity to rebuild their presence in China. The success of Spectrum’s business in China was evident as CEO Michael Bayley mentioned that the volume and rate were significantly higher than in 2019. This positive reception led Bayley to announce the deployment of a second ship, the Ovation of the Seas, to sail from Tianjin in 2025.
Despite the initial plans to send the Ovation of the Seas to Tianjin, Royal Caribbean Group changed its strategy later on. The company decided to turn its attention to California, a state with the sixth largest economy in the world. Bayley expressed the company’s strong ambitions to grow its presence in this region. The Navigator of the Seas, a Voyager-class ship, had been deployed to Los Angeles a year prior and was performing exceptionally well. The decision to homeport the eight-year-old Quantum-class Ovation in Los Angeles year-round beginning in May was driven by the increasing demand on the West Coast.
While Royal Caribbean had success in the Chinese market, Bayley noted that the market performance there still hadn’t reached the levels seen in the American market. The choice to move the Ovation to the West Coast was based on maximizing performance. Bayley clarified that this decision didn’t mean the company was moving away from the China market entirely. In fact, he hinted at potential future deployments in China. Royal’s return to the Chinese cruise market aligned with MSC Cruises resuming sailing there in March. However, other cruise companies like Carnival Corp. and Norwegian Cruise Line Holdings were not immediately focusing on China.
Carnival Corp. opted to redirect ships originally intended for the Chinese market to sail in the U.S. under the Carnival Cruise Line fleet. CEO Josh Weinstein expressed contentment with the current positioning of their assets and brands and adopted a wait-and-see approach regarding the Chinese market. Norwegian Cruise Line Holdings also shared a similar sentiment, preferring to focus on “fun and sun” markets like Bermuda and the Caribbean for future ship deployments. As the cruise industry continues to evolve, companies are making strategic decisions to optimize their performance and meet the growing demand in key markets.