With cruise lines coming out of the downturn and in good health, the drive to expand their itineraries has seen the Persian Gulf become an exciting prospect. Elly Earls talks to Royal Caribbean’s Rama Rebbapragada and Costa Cruises’ Roberto Ferrarini about the potential of this developing destination.
The cruise sector fared relatively well during the harsh economic times of 2009. Despite the need for some lines to discount many of their products, the industry has seen increasing numbers of holidaymakers take advantage of the all-inclusive nature of cruising and the value it offers.
This momentum has seen cruise lines continue their strategies of expansion, and for Costa Cruises and Royal Caribbean International this includes opening up operations in the Persian Gulf. Costa was the first operator in the world to place its confidence in the area, making the UAE its regional hub in 2007.
On 23 February the Italian cruise line celebrated another milestone when the Costa Deliziosa was christened in Dubai, the first ship to be named in an Arabian city.
Royal Caribbean has followed suit, homeporting the Brilliance of the Seas in Dubai for the first time this season. "We started our cruises out of Dubai on 18 January and we will be there until the middle of April offering seven-night cruises in the Arabian Gulf," says Rama Rebbapragada, regional vice-president of Royal Caribbean.
"It’s a new product for us and we are very excited because it has been extremely well received in most of our markets, particularly the UK, Germany and North America." Rebbapragada explains that there are several factors to consider when planning itineraries and deployment, and still more to bear in mind when choosing a homeport in a new country.
"Firstly, you have to take into account the infrastructure and facilities at the port," he says. "You need to be able to move about 2,000 passengers in and out of a ship in a day along with about 8,000 pieces of luggage. Secondly, you need to consider the fact that very little of our business comes from the Gulf itself; most guests fly in from countries such as the UK, Russia and Germany, and even as far away as Japan, China and Australia. Dubai has phenomenal air connectivity.
"Hotel infrastructure is also significant because guests tend to spend a day or two before and after the cruise at the homeport. And finally, you need to think about the port’s location in relation to other ports of call in the region."
Combining these factors with the completion of the new Dubai Cruise Terminal, and the powerful appeal Dubai prides itself on, the city was an obvious choice for Royal Caribbean.
However, the cruise giant is not stopping there and plans to expand its operations in the Gulf when it has established a firm presence in the market. "We are always looking to add some variety to our itineraries," says Rebbapragada.
"The Gulf region has seen a lot of interest in cruising in the recent past and there are several ports interested in developing their infrastructure and coming up with shore excursions and land programmes for cruise passengers."
As a major tourist hub in the region, Dubai, has welcomed the Brilliance of the Seas with open arms, quickly recognising how regions such as the Caribbean and South East Asia have benefited from the cruise industry. "The ports in the region, including Abu Dhabi, have expressed a keen interest in preparing for an expanded usage of their facilities and have been very supportive," Rebbapragada remarks. "They are looking to take advantage of this momentum."
They also understand the demands and expectations of cruise lines. "Even before the opening of the Dubai Cruise Terminal, Dubai did a pretty good job with its temporary facilities," Rebbapragada notes. "They understand that the embarkation process is part of the entire cruise experience and that it reflects on Dubai."
Akin to the calibre of the city’s five-star hotels, the authorities’ efforts in ensuring high standards at the port facilities means that Royal Caribbean has experienced few setbacks commencing operations in the region. "Getting goods into and out of Dubai is very easy; even supplies such as produce can be shipped in without any problems," Rebbapragada says. "We buy whatever we can locally, but we also work with suppliers around the world and have had no issues getting containers onto ships or offloading them on time. In terms of bunkering, we are in the midst of where the oil is supplied."
The increasing number of cruise liners in the region has done little to affect marine operations because, according to Rebbapragada, the volume of ships is not yet high enough to cause congestion. Besides, Dubai’s new cruise terminal, which can accommodate more than one ship at a time, is capable of adequately meeting an increase in demand.
"Even when it comes to the weekend and ships are turning, more than one cruise line can have a ship working in Dubai," Rebbapragada says. "The terminal also has the capacity to handle larger ships. It all bodes well for the industry at the moment."
Room to develop
Roberto Ferrarini, director of marine operations at Costa, agrees, and expects a 40% increase in the number of guests cruising to Dubai in winter 2009-10, which would raise €14m for the city as well as benefitting the cruise line. This could potentially increase as facilities in the Middle East develop. "We are assisting with the continuous improvement of the quality of port operations in the region," Ferrarini says.
"In terms of infrastructure, we are liaising with local port and tourism authorities, as well as customs and immigration, to realise the improvements they want to see. The number of people cruising in the region and the consolidation of the market justifies such investments more than in the past."
Ever a forward-thinking destination, Dubai has taken to cruising faster than many cities Ferrarini has encountered. "The worldwide promotional impact of the cruise industry has been recognised quickly in Dubai and much quicker than in other places where, even after several years, they are still debating whether cruise passengers are positive for the country or not," he says. "We are confident in the will of the local authorities and community to keep investing in software and hardware for the cruise industry."
Yet the Gulf has a long way to go before it can compete with the leading global cruise locations, as Rebbapragada is well aware. "I’ve been in the business for a long time and it took 30 years for the US to get to where it is today," he says. "Even now only 12% of North Americans have experienced a cruise."
A further challenge, Rebbapragada notes, is that the Middle East, despite being an appealing destination, is lacking a local market. "We have to start encouraging people in the Middle East to cruise locally," he says. "Once we reach that scale, you will see more ships deployed in the region and products being customised to the local Middle East market. That’s what we’re working on."