STREAMING NOW: Watch Now

Cruises are having a moment

Cruise lines are sailing full steam ahead.Despite a brutal hurricane season in the United States and Caribbean...

Posted: Dec 21, 2017 3:32 PM
Updated: Dec 21, 2017 3:32 PM

Cruise lines are sailing full steam ahead.

Despite a brutal hurricane season in the United States and Caribbean that canceled cruises and hurt profit, a mix of younger travelers, favorable economic conditions and a broader shift in consumer habits created tailwinds for the industry.

"There's been a surge in interest for cruising globally," said Nomura Instinet analyst Harry Curtis. The Caribbean, Europe and Alaska rank as the most popular destinations.

More than 25 million people took cruises in 2017 and 27 new ships will debut next year, industry group Cruise Lines International Association (CLIA) announced this week.

The largest cruise operators have benefited from rising demand.

Carnival, the biggest line with an 103-ship fleet, reported record sales and profit this year. Carnival has climbed 28% in 2017.

Norwegian Cruise Lines is up 29% on the year. And Royal Caribbean Cruises has soared 51%.

Related: Cruises canceled as Hurricane Irma menaces Caribbean

Cruises aren't just for your grandparents anymore. Royal Caribbean said in November that it's carrying around 30% more Millennials than it did two years ago.

The industry's engine, though, is consumer confidence, Carnival CEO Arnold Donald told CNNMoney in an interview.

"If people are more confident, they tend to be willing to go on vacations. Once on board, they tend to spend a little more."

Related: From New Orleans' Ninth Ward to CEO of Carnival Corp.

Not only is consumer sentiment is at a 17-year high in the United States, a 22-year high in China and a 16-year high in Germany, but consumers are spending money in different ways.

Leisure industry analysts agree that cruise lines benefit from the so-called experience economy. Consumers are splurging on memorable trips with family and friends rather than on luxury items.

"[There's a] broader consumer desire for accumulating experiences rather than objects," UBS analyst Robin Farley wrote in a research note this week. Cruise spending has grown at a faster rate than lodging, clothing and electronics industries this year, Farley found.

Americans travel spending abroad is up nearly 8% over the past 12 months. Spending on durable goods such as cars, jewelry, furniture and appliances is up only 4% during the same period, according to Wolfe Research analyst Jared Shojaian.

"How are we making it all work? [The] bottom line is the experience on board is phenomenal," said Donald.

An expanded destination map to China and Cuba and an advertising blitz have also helped lift Carnival. The company has its own digital streaming channel and airs weekend travel series on network television.

Related: Carnival approved for Cuba cruises

In addition, cruise pricing is also attractive. Taking a five-day cruise around the Caribbean can be cheaper than a plane trip and allow travelers to see more than one spot.

"It's the best bang for the travel buck," Curtis said.

Land vacations will always dominate the travel industry, but cruises have plenty of room to grow, according to Donald. "Every market in the world is under-penetrated," he said.

And thanks to late changes to the GOP's tax bill, foreign lines that operate cruises in the U.S. won't face a tax hike.

Mississippi Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 30900

Reported Deaths: 1111
CountyConfirmedDeaths
Hinds249840
DeSoto159416
Madison130034
Jones112449
Neshoba98871
Rankin93412
Harrison91211
Lauderdale90979
Forrest86942
Scott77115
Jackson62216
Copiah60215
Washington5849
Leake57819
Holmes55341
Lee54718
Wayne54513
Oktibbeha54126
Warren51518
Yazoo5096
Leflore48751
Grenada4835
Lowndes48313
Lincoln46034
Lamar4587
Pike43112
Monroe40130
Lafayette3914
Sunflower3727
Attala36023
Covington3565
Panola3506
Newton3399
Bolivar33414
Simpson3173
Adams31118
Pontotoc2866
Tate28310
Marion28111
Chickasaw27718
Claiborne27410
Noxubee2638
Jasper2626
Winston2616
Pearl River25432
Clay25010
Marshall2323
Smith21811
Clarke20724
Union2079
Coahoma2016
Walthall1995
Kemper17914
Lawrence1772
Yalobusha1707
Carroll16511
Humphreys1479
Tallahatchie1364
Itawamba1358
Montgomery1322
Calhoun1304
Tippah13011
Hancock12813
Webster12710
Jefferson Davis1114
Prentiss1083
Jefferson1073
Greene1058
Tunica1003
Wilkinson949
Amite912
George883
Tishomingo801
Quitman760
Choctaw744
Alcorn692
Perry664
Stone651
Franklin452
Sharkey370
Benton360
Issaquena91
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 44375

Reported Deaths: 984
CountyConfirmedDeaths
Jefferson5221152
Montgomery4127103
Mobile4080134
Tuscaloosa228842
Marshall171110
Madison14307
Lee138437
Shelby128423
Morgan11025
Walker93924
Elmore92514
Franklin89514
Dallas8809
Baldwin8649
Etowah73913
DeKalb7195
Butler63328
Chambers62927
Autauga60712
Tallapoosa59169
Russell5520
Unassigned50323
Houston4964
Limestone4950
Lauderdale4906
Lowndes47221
Cullman4524
Pike4295
Colbert3956
St. Clair3822
Coffee3772
Bullock36910
Covington3587
Calhoun3545
Escambia3506
Barbour3492
Hale31121
Talladega3097
Marengo30211
Wilcox2918
Dale2880
Sumter28512
Clarke2746
Jackson2732
Winston2583
Chilton2462
Blount2351
Monroe2352
Pickens2356
Marion22413
Conecuh2097
Randolph2069
Choctaw19512
Macon1949
Bibb1901
Greene1868
Perry1771
Henry1343
Crenshaw1253
Washington1097
Lawrence1080
Cherokee977
Geneva800
Lamar771
Fayette701
Clay652
Coosa581
Cleburne361
Out of AL00
Tupelo
Broken Clouds
88° wxIcon
Hi: 90° Lo: 73°
Feels Like: 93°
Columbus
Scattered Clouds
88° wxIcon
Hi: 88° Lo: 72°
Feels Like: 98°
Oxford
Scattered Clouds
86° wxIcon
Hi: 90° Lo: 70°
Feels Like: 92°
Starkville
Clear
86° wxIcon
Hi: 87° Lo: 69°
Feels Like: 92°
WTVA Radar
WTVA Temperatures
WTVA Severe Weather