Cruise prices are way up as operators meet surging travel demand

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Carnival’s Breeze cruise ship leaves the Port of Miami.

Christina Mendenhall | Bloomberg | Getty Images

As vacationers emerge into a post-pandemic travel world, cruises have made a spectacular comeback — and ticket prices are surging.

Cruise operators such as Carnival and Royal Caribbean Cruises are setting some ticket prices higher than pre-pandemic levels and are indicating they may raise them further, even as they post pre-Covid profits.

According to data from Cruise Critic, a cruise review site owned by Tripadvisor, the average price of a five-night cruise in the Caribbean for December of this year is $736, roughly 37% higher than the average price a year earlier. December ticket prices have increased by 43% compared to 2019. This was before the Covid-19 Pandemic decimated cruising. The company’s booking volumes likewise hit an all-time high, pushing cruise occupancy and revenue beyond 2019 levels, he said.

Especially as costs of labor, food and fuel continue to rise, Carnival executives noted on the call, the company, which owns multiple major cruise brands, is “well-positioned to drive 2024 pricing higher. The spokesperson for Carnival said that they see “ample headroom” to close the gap. Saunders believes that consumers will gravitate towards cruises because they offer more amenities, such as food and entertainment. Even so, Saunders said he believes the high prices might be here to stay.

are likely subject to fluctuation — but what we’re seeing, generally speaking, is that the higher prices are here today, but those higher prices will ping pong around throughout different sectors,” Saunders said, noting that the Caribbean market is currently one of the most popular sectors. “Cruise companies are not being forced to reduce prices as they once did… instead, they are simply not offering incentives or lowering fares because people are booking. “

Truist Securities analyst Patrick Scholes said while rising oil prices are important to monitor for context for the cruise industry, there’s not enough of a correlation between that increase and the increase in cruise prices to explain the propped-up tickets.

“They’re raising prices naturally — fuel or no fuel, the demand is there for them to be raising prices,” Scholes said.

While in a pre-pandemic world, last-minute bookings meant cheaper deals to secure a cabin, Scholes said, the prices are now so high that they’ll only increase more as the vacation date nears.

For now, the record-high ticket prices show no signs of slowing, according to Ashley Kosciolek, senior cruise writer at The Points Guy. Kosciolek also noted that beverage packages and other add-ons that were included in fares are now more expensive.