brea market potential cruise operations port of jacksonville presented by andrew j. moody, ph.d....

BREA

Market PotentialMarket PotentialCruise OperationsCruise Operations

Port of JacksonvillePort of Jacksonville

Presented by

Andrew J. Moody, Ph.D.

January 26, 2009January 26, 2009

Presented to

Board of Commissioners

Jacksonville Port Authority

BREAwww.breanet.com Slide 2

Presentation OverviewPresentation Overview

• Scope of WorkScope of Work

• BackgroundBackground

• Market AnalysisMarket Analysis

• Growth AnalysisGrowth Analysis


Scope of WorkScope of Work

• Objective: Assess the potential deployment Objective: Assess the potential deployment opportunities at the Port of Jacksonvilleopportunities at the Port of Jacksonville

• Key factors affecting deployment opportunitiesKey factors affecting deployment opportunities– Relocation and construction of new terminalRelocation and construction of new terminal– Expansion of the North American fleet and its destination Expansion of the North American fleet and its destination

deploymentdeployment– Source market for cruise passengers Source market for cruise passengers – Cruise executives’ perceptions of ports Cruise executives’ perceptions of ports – Competition among similarly sized portsCompetition among similarly sized ports– Growth and deployment strategies of individual cruise Growth and deployment strategies of individual cruise

lineslines


BackgroundBackground

• Port is currently a single ship port offering year-round 4- Port is currently a single ship port offering year-round 4- and 5-day cruises to the Bahamas on the and 5-day cruises to the Bahamas on the Fascination.Fascination.

• Approximately 80% of passengers arrive by ground Approximately 80% of passengers arrive by ground transportation and 20% by air.transportation and 20% by air.– More than 50% of all passengers and 75% of drive-to More than 50% of all passengers and 75% of drive-to

passengers reside in 5 states (FL, GA, NC, AL, SC)passengers reside in 5 states (FL, GA, NC, AL, SC)

• Current cruise potential is limited due to size of Current cruise potential is limited due to size of terminal facilities and air draft constraint.terminal facilities and air draft constraint.

• Relocation and expansion of the cruise facilities at Relocation and expansion of the cruise facilities at Mayport will allow the port to support larger cruise Mayport will allow the port to support larger cruise ships.ships.

• FascinationFascination and and Celebration, Celebration, before it, have been before it, have been sailing at over 100% capacity.sailing at over 100% capacity.


Historical Cruise PerformanceHistorical Cruise PerformanceCruise Sailings and Passengers

Cruise Revenues

* Estimated from year-to-date sailings and occupancy


Summary of Cruise OperationsSummary of Cruise Operations

• When operating on a full–year schedule When operating on a full–year schedule the the FascinationFascination will generate: will generate:– 78 sailings78 sailings

– Nearly 180,000 passenger embarkationsNearly 180,000 passenger embarkations

– $3.9 million in cruise revenues$3.9 million in cruise revenues

• an average of $21.80 per passengeran average of $21.80 per passenger

• or nearly $50,000 per sailingor nearly $50,000 per sailing

– On average the On average the FascinationFascination has been sailing has been sailing at 110% of capacityat 110% of capacity


Market Analysis – Key Market Analysis – Key ComponentsComponents

• North American Fleet: Supply & North American Fleet: Supply & DeploymentDeployment

• Demand: Primary Source MarketDemand: Primary Source Market

• Competitive Environment Among Tier 3 Competitive Environment Among Tier 3 PortsPorts

• Potential Caribbean Itineraries from Potential Caribbean Itineraries from JacksonvilleJacksonville


Overview of N.A. Cruise Overview of N.A. Cruise IndustryIndustry• Industry is entering a reduced growth phase Industry is entering a reduced growth phase

brought about by the global economic recession.brought about by the global economic recession.– Newbuilds will remain reasonably strong through Newbuilds will remain reasonably strong through

2010 and then decelerate through 2013 following a 2010 and then decelerate through 2013 following a pattern similar to that after 9/11.pattern similar to that after 9/11.

• Declining yields will drive down construction with a lag.Declining yields will drive down construction with a lag.

• Some planned and committed projects have been cancelledSome planned and committed projects have been cancelled

• Others are being re-negotiated.Others are being re-negotiated.

– European deployments are being re-evaluated with European deployments are being re-evaluated with several ships being redeployed to North America.several ships being redeployed to North America.


Overview of N.A. Cruise Overview of N.A. Cruise IndustryIndustry

Annual New Vessel Introductions, 2000 - 2018

17

10

6

9

3

8

6

11.4

7.0 6.2

-

2

4

6

8

10

12

14

16

18

2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Current Cycle Mean Trend

North American Fleet by Segment – 2000-2018

• Cyclical downturn in newbuilds re-emergesCyclical downturn in newbuilds re-emerges

• Downward trend in newbuilds continuesDownward trend in newbuilds continues

• Average size of Average size of cruise ships cruise ships continues to continues to increaseincrease

Year Contemporary Premium Luxury/Niche Total

Ships Berths Share of Industry



Ships Berths

2000 46 85,703 63% 20 29,329 22% 49 20,384 15% 115 135,416 2009 74 177,200 67% 37 67,064 25% 47 18,734 7% 158 262,998 2012 79 195,452 64% 41 85,998 28% 53 24,456 8% 173 305,906 2018 86 240,912 63% 46 108,798 28% 59 33,006 9% 191 382,716 2000-2009 28 91,497 72% 17 37,735 30% -2 -1,650 -1% 43 127,582 2009-2012 5 18,252 43% 4 18,934 44% 6 5,722 13% 15 42,908 2012-2018 7 45,460 59% 5 22,800 30% 6 8,550 11% 18 76,810 Average Size of Ship - 2000

1,863

1,466

416

1,178

Average Size of Ship - 2009

2,474

2,098

461

1,768

Average Size of Ship - 2018

2,801

2,365

559

2,004


Deployment of N.A. FleetDeployment of N.A. Fleet

• With more and larger cruise ships joining With more and larger cruise ships joining the N.A. fleet, bed day deployment in all the N.A. fleet, bed day deployment in all destination markets will increase.destination markets will increase.– Overall the Caribbean will remain the largest Overall the Caribbean will remain the largest

destination market.destination market.

• Eastern & Southern Caribbean will be a growth Eastern & Southern Caribbean will be a growth leader.leader.

• Western Caribbean and the Bahamas will experience Western Caribbean and the Bahamas will experience a slight decline in market share.a slight decline in market share.

– European share of deployed capacity will fall in European share of deployed capacity will fall in the short-term.the short-term.


Overview of N.A. Cruise Overview of N.A. Cruise IndustryIndustry

Destination Deployment Bed- Days

• Broader Caribbean market still accounts for 40% Broader Caribbean market still accounts for 40% of the industry’s global bed day capacity.of the industry’s global bed day capacity.

Regions 2007 Share 2012 Share Avg. Ann .

Growth 2007-2012

2018 Share Avg. Ann .

Growth 2012-2018

Western Caribbean 15,602,000 17.4% 19,769,512 16.8% 4.8% 24,521,280 16.8% 3.7%

Eastern & Southern Caribbean 16,560,000 18.5% 22,609,821 19.3% 6.4% 28,024,320 19.2% 3.6%

Bahamas 4,634,000 5.2% 5,665,013 4.8% 4.1% 6,860,120 4.7% 3.2%

Canada/New England 1,627,000 1.8% 2,191,315 1.9% 6.1% 2,481,320 1.7% 2.1%

Bermuda 1,285,000 1.4% 1,390,406 1.2% 1.6% 1,459,600 1.0% 0.8%

Alaska 6,927,000 7.7% 9,289,031 7.9% 6.0% 11,530,840 7.9% 3.7%

Hawaii 3,826,000 4.3% 2,500,000 2.1% -8.2% 2,335,360 1.6% -1.1%

Mexico West 4,948,000 5.5% 6,887,339 5.9% 6.8% 8,903,560 6.1% 4.4%

Europe & All Other 34,298,000 38.2% 47,067,726 40.1% 6.5% 59,843,600 41.0% 4.1%

Total 89,707,000 117,370,163 5.5% 145,960,000 3.7%


Implications for JacksonvilleImplications for Jacksonville

• The North American fleet will continue to The North American fleet will continue to expand, albeit at a slower pace, providing expand, albeit at a slower pace, providing more opportunities for smaller ports, like more opportunities for smaller ports, like Jacksonville, to homeport ships displaced Jacksonville, to homeport ships displaced from larger ports.from larger ports.

• Jacksonville is in a geographical location Jacksonville is in a geographical location that will support cruise development in the that will support cruise development in the expanding Eastern and Southern Caribbean.expanding Eastern and Southern Caribbean.


The Caribbean and the Southeast The Caribbean and the Southeast PortsPorts

• Approximately 6.8 million passengers on more Approximately 6.8 million passengers on more than 3,850 cruises visit the Caribbean annually.than 3,850 cruises visit the Caribbean annually.– The Eastern & Southern Caribbean has been gaining The Eastern & Southern Caribbean has been gaining

market share primarily at the expense of the Western market share primarily at the expense of the Western Caribbean.Caribbean.

• The ports of the Southeast account for about 75% The ports of the Southeast account for about 75% of the cruises and passengers destined for the of the cruises and passengers destined for the Caribbean.Caribbean.– The “Tier 1 and Tier 2” ports of South Florida account for The “Tier 1 and Tier 2” ports of South Florida account for

about 94% of the passenger volume.about 94% of the passenger volume.


The “Tier 3” Ports of the SoutheastThe “Tier 3” Ports of the Southeast

Cruises and Passengers by Port of Embarkation

• Jacksonville and Mobile are the dominant “Tier Jacksonville and Mobile are the dominant “Tier 3” ports in the region3” ports in the region

– Both are year-round and single-ship ports serving a Both are year-round and single-ship ports serving a single destination marketsingle destination market

• Charleston and Norfolk are seasonal portsCharleston and Norfolk are seasonal ports

2004 2005 2006 2007

Port Ship Calls

Pax Share of Category

Ship Calls


Ship Calls


Ship Calls


Tier 1 and Tier 2 Ports

Miami 641 1,749,000 37.4% 656 1,803,000 38.1% 705 1,866,000 38.4% 679 1,893,000 39.1%

Port Everglades 637 1,324,000 28.3% 618 1,283,000 27.1% 534 1,145,000 23.5% 582 1,289,000 26.6%

Port Canaveral 464 1,220,000 26.1% 455 1,234,000 26.1% 525 1,396,000 28.7% 482 1,298,000 26.8%

Tampa 198 385,000 8.2% 192 408,000 8.6% 222 457,000 9.4% 173 367,000 7.6%

Subtotal 1,940 4,678,000

1,921 4,728,000

1,986 4,864,000

1,916 4,847,000

Tier 3 Ports

Jacksonville 65 113,728 49.6% 83 137,083 44.0% 77 128,085 42.8% 78 130,148 38.8%

Norfolk 37 47,888 20.9% 31 45,414 14.6% 17 25,179 8.4% 16 30,660 9.1%

Charleston 24 38,892 17.0% 25 41,337 13.3% 29 47,216 15.8% 27 44,379 13.2%

Mobile 18 28,821 12.6% 52 87,628 28.1% 60 98,664 33.0% 79 130,366 38.9%

Subtotal 144 229,329

191 311,462

183 299,144

200 335,553

Grand Total 2,084 4,907,329 2,112 5,039,462 2,169 5,163,144 2,116 5,182,553


The “Tier 3” Ports of the SoutheastThe “Tier 3” Ports of the Southeast

Cruise Itineraries of the Tier 3 Southeast Ports

• Charleston and Jacksonville offer cruises to the BahamasCharleston and Jacksonville offer cruises to the Bahamas

• Mobile cruises are destined for MexicoMobile cruises are destined for Mexico

• Cruises from Norfolk sail to Bermuda and the CaribbeanCruises from Norfolk sail to Bermuda and the Caribbean

• Charleston and Norfolk ships are being redeployed in 2010Charleston and Norfolk ships are being redeployed in 2010– Celebrity adding 5 calls in Charleston in 2010Celebrity adding 5 calls in Charleston in 2010

– Carnival adding 4 calls in Norfolk and 2 in Charleston in 2010Carnival adding 4 calls in Norfolk and 2 in Charleston in 2010

Jacksonville Mobile Charleston Norfolk

Ship Fascination Fascination Fascination Holiday Holiday Holiday NCL Majesty

NCL Majesty

Triumph Grandeur

of the Seas

Grandeur of the Seas

Triumph

Destination Bahamas Bahamas Bahamas Mexico Mexico Mexico Bermuda Bahamas Bahamas Bermuda Caribbean Bahamas

Day 4-Day 5-Day (A) 5-Day (B) 4-Day 5-Day (A)

5-Day (B)

7- Day (A) 7- Day (B) 5-Day 5-Day 9-Day 6-Day

1 Jacksonville Jacksonville Jacksonville Mobile Mobile Mobile Charleston Charleston Charleston Norfolk Norfolk Norfolk

2 Freeport At Sea At Sea At Sea At Sea At Sea At Sea At Sea At Sea At Sea At Sea At Sea

3 Nassau Half Moon Cay

Key West Cozumel Progreso Cozumel St. George's

Great Stirrup

Freeport King's Wharf

At Sea Nassau

4 At Sea Nassau Nassau At Sea Cozumel Calica St. George's

Nassau Nassau King's Wharf

San Juan Nassau

5 Jacksonville At Sea At Sea Mobile At Sea At Sea St. George's

Freeport At Sea At Sea St. Thomas

Freeport

6 Jacksonville Jacksonville Mobile Mobile St. George's

Port Canaveral

Charleston Norfolk Dom. Rep.

At Sea

7 At Sea At Sea Haiti Norfolk

8 Charleston Charleston At Sea

9 At Sea

10 Norfolk


The Cruise Port EvaluationsThe Cruise Port EvaluationsAttribute Mobile Charleston Norfolk

Current Jacksonville

Proposed Jacksonville

Accessibility to Source Markets Drive-to Markets

Highway Access All ports were judged to have very good highway access for the drive-to market. Parking Capacity Sufficient Insufficient Sufficient Sufficient Sufficient

Fly-to Markets Airlift Capacity Inadequate Inadequate Good Just adequate Just adequate Local Access f/ Airport All ports are judged to have very good highway access from the airport to the port.

Accessibility for Suppliers Highway Access All ports were judged to have very good highway access for suppliers. Storage Facilities Just adequate Inadequate Inadequate Just adequate Just adequate

Accessibility for Cruise Ships Access for Largest Ships Poor Adequate Adequate Very Poor Excellent Ease of Navigation Average Average Average Below Average Excellent Ease of Docking Average Average Average Average Excellent

Port Facilities Berthing Capacity Very Inadequate Inadequate Inadequate Very Inadequate Adequate Terminal Capacity Adequate Very Poor Very Good Poor Very Good Terminal Comfort Very Good Very Poor Very Good Poor Very Good Terminal Amenities Average Very Poor Very Good Average Very Good Overall Security Very Good Average Average Average Average

Port Fees and Costs Port Vessel Fees Average Average Average Average Average Port Passenger Fees Average Average Average Average Average Port Parking Fees Average Average Average Average Average Port Labor Costs Below Average Average Above Average Average Average Port Security Charges Average Average Average Average Average

Miscellaneous City as a Destination Below Average Above Average Average Average Average Overall Ranking of Port Average Below Average Average Average Above Average


The Jacksonville Source MarketThe Jacksonville Source Market• Source market defined by 2-, 4- and 6-hour drive timesSource market defined by 2-, 4- and 6-hour drive times

– Constrained to the south by Tampa and Port CanaveralConstrained to the south by Tampa and Port Canaveral– Constrained to the west by MobileConstrained to the west by Mobile

• Core target market consists of individuals between the age of 25 and 80 with a household Core target market consists of individuals between the age of 25 and 80 with a household income over $40,000income over $40,000


The Jacksonville Source MarketThe Jacksonville Source Market

• 1.44 million potential Caribbean cruise passengers1.44 million potential Caribbean cruise passengers

Target Market Size1.50 Million Households3.90 Million Individuals

Vacationers(61%)

2.38 Million Individuals

Non-Vacationers(39%)


Past Cruisers(45%)


Cruise Prospects(55%)


Potential Caribbean Cruisers(61%)


Non-Caribbean Cruisers(39%)


Potential Caribbean Cruisers(60%)


Target Caribbean Cruisers


Non-Caribbean Cruisers(40%)



The Jacksonville Source MarketThe Jacksonville Source Market

• High growth market with region’s largest High growth market with region’s largest population centerpopulation center

• Nearly 50% of the target cruise market resides Nearly 50% of the target cruise market resides within a 2-hour drive of Jacksonvillewithin a 2-hour drive of Jacksonville

• Penetration rates of projected drive-to cruise Penetration rates of projected drive-to cruise volume at Jacksonville for 2009volume at Jacksonville for 2009

– 10% of potential Caribbean cruisers10% of potential Caribbean cruisers

– 6% of all potential cruisers6% of all potential cruisers

– 3.7% of all total “core” target market3.7% of all total “core” target market



• Proposed relocation and construction of new Proposed relocation and construction of new terminal facilities enhances the port’s image and terminal facilities enhances the port’s image and operating characteristics.operating characteristics.

• Charleston, Jacksonville’s nearest Tier 3 Charleston, Jacksonville’s nearest Tier 3 competitor, is considered to be the least competitor, is considered to be the least attractive port.attractive port.

• Jacksonville is considered to have adequate Jacksonville is considered to have adequate drive-to capacity.drive-to capacity.

• With adequate fly-to capacity, Jacksonville can With adequate fly-to capacity, Jacksonville can also attract passengers for longer cruise also attract passengers for longer cruise itineraries.itineraries.


Destinations in the BahamasDestinations in the Bahamas

• The Bahamas is capable of supporting multiple The Bahamas is capable of supporting multiple cruise itineraries.cruise itineraries.


Existing Itineraries from Florida Existing Itineraries from Florida PortsPorts• Canaveral to the Eastern Caribbean – Canaveral to the Eastern Caribbean – Disney MagicDisney Magic

– Similar cruises can be easily originated in Jacksonville.Similar cruises can be easily originated in Jacksonville.


Existing Itineraries from Florida Existing Itineraries from Florida PortsPorts• Canaveral to the Eastern Caribbean – Canaveral to the Eastern Caribbean – Freedom of the SeasFreedom of the Seas

– A similar cruise could be offered from Jacksonville with ship with A similar cruise could be offered from Jacksonville with ship with sufficient speed and range.sufficient speed and range.


Existing Itineraries from Florida Existing Itineraries from Florida PortsPorts• Miami to the Eastern Caribbean – Miami to the Eastern Caribbean – Carnival TriumphCarnival Triumph

– Also possible from Jacksonville.Also possible from Jacksonville.



• 7-day or longer itineraries to the Eastern 7-day or longer itineraries to the Eastern Caribbean are certainly feasible from the Caribbean are certainly feasible from the Port of Jacksonville.Port of Jacksonville.

• Cruises to the Southern Caribbean while Cruises to the Southern Caribbean while unlikely would have to include at least one unlikely would have to include at least one call at a Eastern Caribbean port and be 10 call at a Eastern Caribbean port and be 10 days.days.

• 7-day cruises to the Western Caribbean are 7-day cruises to the Western Caribbean are feasible with an initial call at Key West and feasible with an initial call at Key West and two calls in the Western Caribbean.two calls in the Western Caribbean.


Summary of Market AnalysisSummary of Market Analysis

• Increase in North American fleet will result Increase in North American fleet will result in a trickle down of homeport deployment in a trickle down of homeport deployment from the major to minor ports.from the major to minor ports.

• Caribbean deployment will continue to Caribbean deployment will continue to increase with the Eastern Caribbean increase with the Eastern Caribbean increasing its market share.increasing its market share.

• Jacksonville has only a small penetration Jacksonville has only a small penetration into its drive-to market for potential into its drive-to market for potential Caribbean cruisers and should be able to Caribbean cruisers and should be able to attract more passengers from this market.attract more passengers from this market.


Summary of Market AnalysisSummary of Market Analysis

• Relocation and construction of the new Relocation and construction of the new cruise facility will enhance the port’s cruise facility will enhance the port’s image and cruise operations.image and cruise operations.

• There are numerous cruise itineraries There are numerous cruise itineraries throughout the Caribbean that can be throughout the Caribbean that can be offered from the Port of Jacksonville.offered from the Port of Jacksonville.


Growth Analysis – Key Growth Analysis – Key ComponentsComponents• S.W.O.T. AnalysisS.W.O.T. Analysis

• Target Cruise LinesTarget Cruise Lines

• Summary of Potential ItinerariesSummary of Potential Itineraries

• Tier 1 Ports: Capacity and Displacement Tier 1 Ports: Capacity and Displacement EffectsEffects

• Potential New Deployments in JacksonvillePotential New Deployments in Jacksonville

• Estimates of Passenger and Revenue GrowthEstimates of Passenger and Revenue Growth


S.W.O.T AnalysisS.W.O.T Analysis

• Port’s strengths outweigh its weaknesses and its Port’s strengths outweigh its weaknesses and its opportunities overshadow the threats.opportunities overshadow the threats.

STRENGTHS WEAKNESSES 1. Improved marine access 1. Dependent on a single ship and cruise line 2. Good access to source markets 2. Can only berth a single ship 3. Expanded parking facilities 3. Single cruise destination 4. Good access to Caribbean destinations 5. Proven ability to fill ships 6. Good port operations

OPPORTUNITIES THREATS 1. Access to a broader Caribbean market 1. Potential for Carnival to expand in Mobile 2. Geographic location in southeast U.S. 2. Small probability of redeployment of Fascination

3. Year-round cruise potential 3. Charleston could invest in cruise port facilities

4. Local resort and venues for pre- and post-cruise stays

4. Saturation of the Bahamas as a cruise destination


Target Cruise LinesTarget Cruise Lines

• CarnivalCarnival– Steady expansion and committed to the Steady expansion and committed to the

CaribbeanCaribbean– Will redeploy ships from EuropeWill redeploy ships from Europe– Has been successful at JacksonvilleHas been successful at Jacksonville– Has been willing to add capacity at the portHas been willing to add capacity at the port

• NorwegianNorwegian– Has a strong focus on drive-to marketsHas a strong focus on drive-to markets– Moving out of CharlestonMoving out of Charleston– Opportunity for redeployment from other East Opportunity for redeployment from other East

Coast portsCoast ports– Overall operations under reviewOverall operations under review


Target Cruise LinesTarget Cruise Lines

• CelebrityCelebrity– In the midst of a significant fleet expansionIn the midst of a significant fleet expansion– Has a history with JacksonvilleHas a history with Jacksonville– New terminal should be beneficialNew terminal should be beneficial– Market demographics must fit their passenger Market demographics must fit their passenger

profileprofile

• Royal CaribbeanRoyal Caribbean– Steady expansion and committed to the Steady expansion and committed to the

CaribbeanCaribbean– Expanding in the Eastern & Southern CaribbeanExpanding in the Eastern & Southern Caribbean– Opportunity for redeployment from other East Opportunity for redeployment from other East

Coast portsCoast ports


Potential ItinerariesPotential Itineraries

• Potential Eastern Caribbean cruise itinerariesPotential Eastern Caribbean cruise itineraries– A mix of the Bahamas and the Eastern CaribbeanA mix of the Bahamas and the Eastern Caribbean

Itinerary 1 Itinerary 2 Itinerary 3 Itinerary 4

Destination Eastern

Caribbean Eastern

Caribbean Eastern

Caribbean Eastern

Caribbean Day 7-Day 7-Day 7-Day 7-Day

1 Jacksonville Jacksonville Jacksonville Jacksonville 2 At Sea At Sea At Sea At Sea 3 At Sea At Sea At Sea At Sea

4 Dominican Republic St. Thomas San Juan St. Thomas

5 Grand Turk Grand Turk Dominican Republic San Juan

6 At Sea At Sea Haiti At Sea 7 Freeport Freeport At Sea Nassau

Jacksonville Jacksonville Jacksonville Jacksonville


Potential ItinerariesPotential Itineraries

• Potential Western Caribbean cruise Potential Western Caribbean cruise itinerariesitineraries– A mix of the Bahamas and the Western CaribbeanA mix of the Bahamas and the Western Caribbean

Itinerary 1 Itinerary 2 Itinerary 3

Destination Western

Caribbean Western

Caribbean Western

Caribbean Day 7-Day 7-Day 7-Day

1 Jacksonville Jacksonville Jacksonville 2 At Sea At Sea At Sea 3 At Sea At Sea At Sea 4 Grand Cayman Ocho Rios Ocho Rios

5 Cozumel Grand Cayman Grand Cayman

6 At Sea At Sea At Sea 7 Freeport Freeport Key West

Jacksonville Jacksonville Jacksonville


Capacity Utilization at Tier 1 Capacity Utilization at Tier 1 PortsPorts• Tier 1 ports in Florida are at or near Tier 1 ports in Florida are at or near

capacity on prime weekend dates.capacity on prime weekend dates.

• Even if not at capacity congestion at Miami Even if not at capacity congestion at Miami and Port Everglades is a growing problem.and Port Everglades is a growing problem.

• Cruise ship sailings and passenger Cruise ship sailings and passenger volumes will continue to increase at these volumes will continue to increase at these ports through 2011.ports through 2011.

• Redeployments and displacements will Redeployments and displacements will continue.continue.


Port Canaveral Port Canaveral

• Port Canaveral averages 8 weekly cruises in Port Canaveral averages 8 weekly cruises in March 2009 which will grow to 9 in 2010March 2009 which will grow to 9 in 2010

– Deployment of Freedom of the Seas in 2010 reaches Deployment of Freedom of the Seas in 2010 reaches Sunday limitSunday limit

• Peak Saturday Passengers: 2009 – 4,800+; 2010 – 5,400+Peak Saturday Passengers: 2009 – 4,800+; 2010 – 5,400+

• Peak Sunday Passengers: 2009 – 3,800+; 2010 – 7,400+Peak Sunday Passengers: 2009 – 3,800+; 2010 – 7,400+

Available Berths: 3 Available Berths: 3


Port Everglades Port Everglades

• Port Everglades averages 15 weekly cruises in March 2009 which will grow to 17 Port Everglades averages 15 weekly cruises in March 2009 which will grow to 17 in 2010in 2010

– There is limited additional capacity and high passenger volumes on Saturdays and SundaysThere is limited additional capacity and high passenger volumes on Saturdays and Sundays

• Peak Saturday Passengers: 2009 – 16,000+; 2010 – 24,000+Peak Saturday Passengers: 2009 – 16,000+; 2010 – 24,000+



Port of Miami Port of Miami

• Port of Miami averages 18 weekly cruises in Port of Miami averages 18 weekly cruises in March 2009 and 2010March 2009 and 2010

– There is limited additional capacity and high passenger There is limited additional capacity and high passenger volumes on Sundays and Mondaysvolumes on Sundays and Mondays


• Peak Monday Passengers: 2009 – 13,000+; 2010 – 13,000+Peak Monday Passengers: 2009 – 13,000+; 2010 – 13,000+


Redeployment in ActionRedeployment in Action

• Introduction of 3,652- Introduction of 3,652- passenger Carnival Dreampassenger Carnival Dream– Displaces the 2,972-passenger Displaces the 2,972-passenger

Carnival Glory at Port CanaveralCarnival Glory at Port Canaveral

– Carnival Glory then displaces the Carnival Glory then displaces the 2,758-passenger Carnival 2,758-passenger Carnival Triumph in MiamiTriumph in Miami

– Carnival Triumph then displaces Carnival Triumph then displaces the 2,052-passenger Carnival the 2,052-passenger Carnival Fantasy in New OrleansFantasy in New Orleans

– Carnival Fantasy then displaces Carnival Fantasy then displaces the 1,452-passenger Holiday in the 1,452-passenger Holiday in MobileMobile

– Holiday is deployed outside Holiday is deployed outside North AmericaNorth America

• Introduction of 5,400- Introduction of 5,400- passenger Oasis of the Seaspassenger Oasis of the Seas– Displaces the 3,114- passenger Displaces the 3,114- passenger

Navigator of the Seas at Port Navigator of the Seas at Port EvergladesEverglades

– Navigator of the Seas then Navigator of the Seas then displaces the 3,634-passenger displaces the 3,634-passenger Freedom of the Seas in MiamiFreedom of the Seas in Miami

– Freedom of the Seas is then Freedom of the Seas is then deployed at Port Canaveral as a deployed at Port Canaveral as a second RCCL shipsecond RCCL ship

– Exhausts available berths on Exhausts available berths on SundaysSundays


Attributes of Potential New Attributes of Potential New DeploymentDeployment

• Carnival is likely to continue to deploy larger ships at Carnival is likely to continue to deploy larger ships at Jacksonville over time as full capacity is maintained.Jacksonville over time as full capacity is maintained.

– Fascination Triumph Class Conquest ClassFascination Triumph Class Conquest Class

• NCL will likely discontinue operations at Charleston and will NCL will likely discontinue operations at Charleston and will deploy new F3 ship in Miami in 2010.deploy new F3 ship in Miami in 2010.

– A ship like the Norwegian Spirit could be deployed on A ship like the Norwegian Spirit could be deployed on alternative Bahamas or Eastern Caribbean itineraries.alternative Bahamas or Eastern Caribbean itineraries.

• RCCL/Celebrity have reduced their presence in both RCCL/Celebrity have reduced their presence in both Charleston and Norfolk in 2010 and will add numerous ships Charleston and Norfolk in 2010 and will add numerous ships through 2011.through 2011.

– RCCL will deploy the RCCL will deploy the Allure of the Seas Allure of the Seas at Port Everglades in at Port Everglades in 2011 resulting in a chain of redeployments.2011 resulting in a chain of redeployments.

– Celebrity will be adding another two ships by 2011 and may be Celebrity will be adding another two ships by 2011 and may be interested in moving the Century from Miami.interested in moving the Century from Miami.


Deployment PotentialDeployment Potential

• Expansion of cruise itineraries to the Eastern and Western Expansion of cruise itineraries to the Eastern and Western Caribbean.Caribbean.

– More than a doubling of passengers and cruise revenuesMore than a doubling of passengers and cruise revenues

Year Sailings Passengers Ships Port Revenues Rev/Pax 2004 65 113,728 Zenith, Miracle, Jubilee, Celebration $2,101,693 $18.48 2005 83 137,083 Zenith, Celebration $2,264,611 $16.52 2006 77 128,085 Celebration $2,313,215 $18.06 2007 78 130,148 Celebration $2,502,746 $19.23 2008 53 100,414 Celebration, Fascination $1,926,945 $19.19 2009 78 176,062 Fascination $3,838,143 $21.80 2010 78 176,062 Fascination $3,934,096 $22.35 2011 104 287,102 CCL Triumph Class, NCL Sky/Spirit Class $6,575,686 $22.90 2012 104 287,102 CCL Triumph Class, NCL Sky/Spirit Class $6,740,078 $23.48

2013 130 355,468 CCL Triumph Class, NCL Sky/Spirit Class, RCCL Vision Class

$8,553,672 $24.06

2014 130 355,468 CCL Triumph Class, NCL Sky/Spirit Class, RCCL Vision Class $8,767,514 $24.66

2015 130 371,498 CCL Conquest Class, NCL Dawn/Star Class, RCCL Vision Class $9,391,969 $25.28

2016 130 379,634 CCL Conquest Class, NCL Dawn/Star Class, RCCL Sovereign Class

$9,837,583 $25.91

2017 130 379,634 CCL Conquest Class, NCL Dawn/Star Class, RCCL Sovereign Class $10,083,523 $26.56

2018 130 379,634 CCL Conquest Class, NCL Dawn/Star Class, RCCL Sovereign Class

$10,335,611 $27.23


SummarySummary

• Expansion of the North American fleet with larger ships Expansion of the North American fleet with larger ships being deployed on Caribbean itineraries will continue.being deployed on Caribbean itineraries will continue.

• Movement of ships from Tier 1 to Tier 2 to Tier 3 ports will Movement of ships from Tier 1 to Tier 2 to Tier 3 ports will be necessary.be necessary.

• Jacksonville is located so as to be able to source Jacksonville is located so as to be able to source passengers throughout the southeast and to also access passengers throughout the southeast and to also access destinations throughout most of the Caribbean.destinations throughout most of the Caribbean.

• With the construction of a new terminal at Mayport, With the construction of a new terminal at Mayport, Jacksonville will be able to handle the largest cruise ships Jacksonville will be able to handle the largest cruise ships and have a competitive advantage over other Tier 3 ports.and have a competitive advantage over other Tier 3 ports.

• As a result Jacksonville has the potential to more than As a result Jacksonville has the potential to more than double current passenger volumes and revenues over the double current passenger volumes and revenues over the next decade. next decade.

brea market potential cruise operations port of jacksonville presented by andrew j. moody, ph.d....

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