Cruise companies intend to increase prices as costs rise and demand grows

In the past year, cruise vacations have become a popular choice for people looking for less expensive forms of transportation, but American cruise companies are indicating that itineraries may become more expensive in the near future.

As occupancy levels near pre-pandemic levels, cruise companies like Royal Caribbean Cruises and Carnival Corp. are trying to increase pricing after aggressively discounting following years of COVID-era testing procedures and prohibitions.

According to Patrick Scholes, an analyst at Truist hotels and cruises, cruise holidays were typically 15% to 20% less expensive than land-based vacations prior to the start of the epidemic. He noted that the difference had grown to 50%.

When compared to the same quarter in 2019, prior to the pandemic, onboard spending for Norwegian Cruise Lines (NCLH.N) increased by 49.9% in the second quarter. In the same time frame, onboard spending increased by around 36.8% for Royal Caribbean Cruises and 17.2% for Carnival.

According to information from the Cruise Lines International Association, people are taking advantage of the savings opportunity, with over 73% of those who have never taken a cruise stating they would be open to the idea.

Carnival and Royal Caribbean said that more visitors than in 2019 were first-time cruisers.