Deep Sea Transportation of Passengers, Except by Ferry

SIC 4481

Companies in this industry

Industry report:

This category includes establishments primarily engaged in operating vessels for the transportation of passengers on the deep seas.

Industry Snapshot

The passenger cruise industry of the early twenty-first century began around 1970 when approximately 500,000 people took overnight cruises. Since that time, the number of passengers has increased dramatically. According to Cruise Lines International Association (CLIA), more than 14.8 million people took a cruise in 2010, an increase of more than 10 percent, the largest year-over-year increase since 2003. Twelve new ships joined CLIA, bringing its total to more than 200 ocean-going ships and the lower berth total capacity up 8.1 percent to 307,707. In 2010 CLIA member line ships operated at 103.1 percent occupancy. That year, according to the CLIA, the cruise industry contributed $35.8 billion to the U.S. economy and created nearly 330,000 jobs for Americans.

Since the mid-1980s, the cruise industry has conducted extensive market and consumer research. As a result, it continues its evolution of the cruise ship experience by adding new destinations, new ship design concepts, new on-board/on-shore activities, new themes, and new cruise lengths to reflect the changing vacation patterns of the public. Examples of modern offerings include Wi-Fi and cell phone services, rock-climbing walls and bowling alleys, upscale spa experiences, and children-only decks.

The cruise industry continues to have a very close working relationship with the travel agency industry. More than 90 percent of all cruise passengers are booked through travel agents. Travel agencies have found that cruises are profitable to sell, with more than half of all travel agent sales coming from cruise sales. In addition, many people who take a cruise want to repeat the experience.

Organization and Structure

Cruise lines generally offered either luxury, mass market (commonly called contemporary), or specialty cruises, although some analysts believed that super-luxury cruises that cater to the very rich and short budget-priced cruises that target middle-income vacationers were emerging as two distinct categories.

Luxury cruise lines emphasize personal service aboard relatively small cruise ships. The contemporary category includes such highly advertised companies as Carnival Cruise Lines and Royal Caribbean Cruise Lines. These companies offer resort-style cruises aboard mammoth ships. The specialty cruise segment includes companies like Windstar Cruises, which offers adventure cruises to exotic ports of call aboard small ships that often carry as few as 100 passengers. Destinations include Africa, the Amazon, Antarctica, and seldom-visited islands in the Caribbean and South Pacific. Specialty companies also offer theme cruises with lecturers or celebrity hosts from the world of science, entertainment, or sports. For example, the Cunard Steamship Co. once offered murder mysteries aboard the famous Queen Elizabeth 2 (QE2) and opera and classical music experiences in which amateurs were invited to study and play alongside professionals aboard the Sagafjord.

Registry.
Although they operate from U.S. ports and their headquarters are in the United States, many major cruise companies are incorporated elsewhere. For example, the corporate headquarters for Carnival Corporation, the largest North American cruise operator, are in Miami, but the company and its cruise subsidiaries are incorporated in Panama, The Netherlands Antilles, the British Virgin Islands, the Bahamas, and Liberia.

U.S. cruise industry vessels are primarily of Panamanian, Liberian, or Bahamian registry, which provides cruise line operators with significant tax breaks over U.S. registration. Foreign registration, known as "flags of convenience," also allows U.S. ships to hire foreign crews and escape strict U.S. safety inspections. The only U.S. flagged ships in the North American deep-water cruise industry are those operated by Clipper Cruise Lines.

National Organizations.
The two main trade associations for the industry are the Cruise Lines International Association (CLIA) and the International Council of Cruise Lines (ICCL), which merged in 2006 to form an expanded industry alliance. The newly created organization moved its headquarters to Ft. Lauderdale, Florida, in early 2007 and maintained a satellite office in Washington, D.C. Its goal was the promotion of cruise travel. As the largest nonprofit industry association in the industry, in 2011 the organization represented 26 member lines, more than 16,000 travel agencies, and about 100 executive partners. The cruise industry continued to be the fastest-growing travel segment in the industry. In addition, travel agents played an important role in that growth. In the 1980s, travel agents began actively suggesting cruises as a vacation alternative. Since then, cruise-only travel agencies have formed, and large agencies have created cruise divisions. CLIA also sponsors National Cruise Vacation Month in February.

Background and Development

Until the early 1800s, most ocean-going vessels sailed only when they had a full cargo load and the weather was favorable. Passengers were secondary. However, in January of 1818, the Black Ball Line in New York began regularly scheduled service between the United States and England. The first ship, the James Monroe, left New York Harbor on time, despite a blizzard, and arrived in Liverpool three weeks later. The Black Ball Line proved so successful that other ships began regular service. "Packet ships," as they were known, were the first ships to concern themselves with the comfort of their passengers.

In the 1830s, steamships began to replace packet ships for carrying mail and passengers. The Pacific Mail Steamship Company, a U.S. line founded in 1848, eventually dominated passenger service across the Pacific, but English companies dominated transatlantic service. One of these companies was the Cunard Steamship Co., Ltd., founded in 1840 by Samuel Cunard. Cunard was a Canadian who won the contract to deliver mail between England and Halifax, Nova Scotia. He and English partners formed the British and North American Royal Mail Steam Packet Co., which was renamed the Cunard Line in 1878. The first Cunard ship was the Britannia, which sailed from Liverpool on July 4, 1840. The ship carried a cow on board to provide passengers with fresh milk during the 14-day crossing. By 1880 the Cunard Line operated 19 ships that provided regular transatlantic passenger service.

Notable Firsts.
In 1852 the City of Glasgow, owned by the British Inman Line, became the first ship to provide regular transatlantic passenger service without also having a contract to deliver mail. The Glasgow was also the first ship to be fitted with a spar deck covering part of the main deck. The spar deck provided passengers with a sunny recreation area in good weather and protection on the main deck during bad weather.

In 1879 another Inman ship, the City of Berlin, became the first passenger ship to be outfitted with electric lights. The Inman Line was also the first to carry immigrants to the United States on a regular basis in "steerage class." During most of the nineteenth century, passengers traveling in steerage slept wherever there was space in the hold and provided their own food or ate out of communal kettles. Signs aboard Cunard Line ships cautioned that "passengers of the First and Second Class are requested not to throw money or eatables to the steerage passengers, thereby creating disturbance and annoyance." By the end of the nineteenth century, carrying immigrants was profitable for most passenger ships. The International Navigation Company of Philadelphia, later known as the American Line, purchased the Inman Line in the late 1890s.

The first organized recreational activities aboard an oceangoing passenger ship may have been aboard the Great Eastern in 1858. The Great Eastern, a commercial failure owned by the Eastern Navigation Company, was the largest ship of its day. It was also the first ship with enough space for passengers to congregate on deck. On its maiden voyage, passengers organized a marathon and played ninepins. Most on-board recreation was organized by passengers until after World War I, when deck tennis, shuffleboard, quoits, dancing, and bingo became popular ship-sponsored activities.

In 1870 the Oceanic, owned by the Oceanic Steam Navigation Company, became the first ship with multiple passenger decks. The Oceanic also offered passengers an on-board saloon and oversized cabins equipped with electric bells to summon stewards. In the 1880s, the Umbria and the Etruria, owned by the Cunard Line, became the first ships with refrigeration for food storage.

Superliners.
By the early 1900s, Germany began to dominate transatlantic passenger service with luxury liners that rivaled the most posh European hotels. The Amerika, owned by the Hamburg-Amerika Line, was the first ship equipped with an elevator. It also boasted an on-board restaurant operated by the Ritz-Carlton Hotel in London. Even the famed Cunard Line was losing money to the German competition, and American financier J. P. Morgan, who had purchased the White Star Line, was ready to buy the Cunard Line. However, the English government saved Cunard by subsidizing the construction of two new ships, the Mauretania and the Lusitania.

The Mauretania and the Lusitania, launched in 1907, were the first "superliners," the largest and most luxurious passenger ships built by that time. Two cruise traditions began aboard these English superliners: dressing for dinner and the shipboard romance. Cunard's advertising promised, "Passengers will remember how romantically the glowing phosphorescent waves curled back in the ship's wake falling forever in flakes of diamond and pearl. They will remember how readily the damsel of their choice could be persuaded to a secluded spot in order to observe this poetic phenomenon."

In 1911 the White Star Line surpassed even Cunard for luxury when it launched the Olympic. In addition to the amenities that had become standard, the Olympic was outfitted with a swimming pool, Turkish baths, and a tennis court. The ill-fated Titanic, which sank on its maiden voyage in 1912, was a sister ship to the Olympic. White Star never fully recovered financially from the sinking of the Titanic. In 1934 the Cunard Line purchased White Star and became Cunard White Star Ltd.

The Lusitania earned a place in history when it was sunk by a German U-boat in 1915. Although kept secret by the U.S. and British governments for nearly 50 years after the sinking, the Lusitania was carrying tons of munitions for the English war effort, in violation of U.S. neutrality laws. Considered unsinkable by many, the Lusitania sank in only 21 minutes after being hit by a single torpedo, which detonated the contraband cargo. Nearly 1,200 people were killed, including 128 Americans, hastening U.S. entry into World War I.

After World War I, the largest of the German ocean liners were divided among the Allies. The United States Line got the Vaterland, which it renamed the Leviathan. The Leviathan became the first ship to launch a mail plane from its decks in 1927. Cunard, which lost 22 ships during the war, was given the Imperator, which was rechristened the Berengaria and became the line's flagship. White Star received the Bismarck, which it renamed the Majestic. The Majestic was the largest ocean liner afloat until 1935, when the French launched the 80,000-ton Normandie. The Normandie, described as a floating luxury hotel, included 28 six-room suites, 30 two-room suites, and 24 verandah suites, along with the usual array of staterooms, each of which had a private bath. The ship also had an air-conditioned dining saloon, a movie theater, and a glass-enclosed garden complete with fountains and caged song birds.

The years between 1920 and 1940 are considered the glamour days for transatlantic passenger ships. The rich and famous from Europe and the United States often took long, slow, luxurious, pampered trips at sea, which were captured by the newsreels to be shown to common folks in movie theaters. However, the Depression in the 1930s almost destroyed the Cunard Line. The British government again came to the rescue by subsidizing the construction of two more ships, the Queen Mary and the Queen Elizabeth. The Queen Mary, launched in 1936, became the new symbol of luxury, surpassing even the Normandie, which was destroyed by fire in New York Harbor in 1942. Only 350 of the Queen Mary's 1,100 crew members were needed to operate the ship while the other 750 catered to the needs of 2,100 passengers. The Queen Elizabeth was launched in 1940 but was converted into a troop carrier during World War II.

After World War II, the glamour of cruises faded. Jet planes replaced ships for those who could afford to fly, crossing the Atlantic in hours instead of days. By the 1960s, most passenger ships had become drab and dingy. In 1952 the American Line launched the United States, which was the largest passenger ship ever built in the United States and the fastest oceangoing passenger ship in service. However, the ship was mothballed in 1969 due to a lack of passengers. Cunard also sold the Queen Mary in 1967, symbolizing the end of an era. The ship became a tourist attraction in Long Beach, California. The Queen Elizabeth was sold in 1968, leaving Cunard with only one ship, the Queen Elizabeth 2. The original Queen Elizabeth caught fire and sank in Hong Kong Harbor before it could be turned into what was planned to be a floating university. Cunard reinvented itself as a cruise line in the 1970s.

Reinvention of an Industry.
The modern cruise industry began to take shape in the late 1960s. Faced with declining demand for transatlantic passenger service, especially during the winter when the North Atlantic was stormy and cold, passenger lines began offering vacation cruises to warm-weather locations. Instead of the transportation business, they were becoming part of the tourist and vacation industry. Princess Cruise Lines, founded in 1965, was one of the pioneers in the emerging industry, leasing a converted ferry from the Canadian Pacific Railway during the winter months to offer cruises from Los Angeles to Mexico. However, several business historians considered Carnival Cruise Lines and its co-founder Ted Arison to have actually invented the modern cruise industry in the mid-1970s.

Miami-based Carnival Cruise Lines was founded in 1972 as a subsidiary of the American International Travel Service. The company purchased the former Empress of Canada passenger liner, renamed it the Mardi Gras, and invited 300 travel agents to sail on its maiden voyage, which almost proved disastrous. The Mardi Gras ran aground before it cleared the Port of Miami. By 1974 Carnival was near bankruptcy. Arison assumed more than $5 million in debt and bought American International Travel's interest in the cruise line for one dollar.

What followed was a remarkable, serendipitous turnaround. Even with a complete remodeling, the Mardi Gras remained an aging, inefficient passenger ship. During the energy crisis of the 1970s, it sailed slowly to save fuel. To fill the additional time at sea between ports of call, Arison added a disco, comedians, singers, and other live entertainment. He also encouraged less formality, more casual dress, and a festive atmosphere. The crew began to call the Mardi Gras the "fun ship," and Carnival began advertising that time aboard ship was as fun and exciting for the passengers as the exotic destinations.

The "Fun Ship" marketing strategy, adopted as a registered trademark of the Carnival Cruise Lines, was an enormous success. Based on two people per cabin, the Mardi Gras sailed at more than 95 percent capacity in 1974 and 100 percent capacity in 1975. At the end of the year, Carnival purchased a second ship, the former Queen Anna Maria, which it renamed the Carnivale. A third refurbished ship, renamed the Festivale, was added in 1978. It was then the largest and fastest cruise ship sailing between Miami and the Caribbean. Over the next four years, Carnival built four new superliners and quickly became the largest cruise line in the world, capturing one-quarter of the North American market and carrying twice as many passengers as its closest competitor.

The cruise industry also received an invaluable boost from The Love Boat, a popular TV series that aired on network television for nine seasons beginning in 1977. The Love Boat, which featured a ship owned by Los Angeles-based Princess Cruise Lines, revived the Golden Era link between ocean liners and romance and made the point that cruises were not only for the rich. The Love Boat was a staple among syndicated reruns into the 1990s.

A 1997 Cruise Lines International Association (CLIA) study identified some interesting as well as favorable trends in the passenger cruise industry. The study reported that by 1997 approximately 11 percent of the U.S. population had taken a cruise, compared to just 4 percent a decade earlier. The fastest growing segment of those taking cruises was passengers between the ages of 25 and 39 years old, and the average household income was about $50,000 a year.

The need for industry-wide international and national regulations governing the care of sick or injured passengers on cruise ships was brought to the forefront by the International Council of Cruise Lines. For example, Holland America Lines, a passenger line with an excellent reputation for safety and sanitation, reported 325 to 375 emergency debarkations in an average year. Council statistics indicated that if Holland America's figures were the industry norm, annual emergency debarkations from ships would be between 3,760 and 4,350.

Only Norway, Britain, and Italy had any rules regarding cruise line medical care. The majority of deep-water vessels calling on U.S. ports, however, are registered in the Bahamas, Liberia, Panama, Norway, and Italy. The U.S. Coast Guard does conduct sanitation inspections of these foreign ships.

Attendees of an International Council of Cruise Lines meeting on the topic in early 1996 recommended guidelines that outlined the basic, advanced life support and cardiac life support that should be available on board by medical staff and stated that medical staff should be certified in competencies, including emergency medicine, family practice and internal medicine, emergency and critical care, advanced care for injured patients, and minor surgical skills. Approval of such recommendations, however, was not immediate.

A sign of the times in the booming economy of 1998-99 was the proliferation of mergers and acquisitions among corporations in the United States, and the cruise industry was no exception. American Classic Voyages Company (AMCV) announced an agreement to purchase the New Amsterdam from Holland America Lines for $114.5 million, with contingencies. AMCV reported a $2.2 million earnings loss for the first six months of 1999, but its second-quarter 1999 earnings were $2.3 million. Carnival Cruise Line had attempted to buy Norwegian Cruise Lines but dropped its bid in December 1999 when Norwegian sold two of its ships to meet loan payments. Norwegian's 1999 earnings were approximately $40 million, and company officials projected a $92 million profit for 2000.

Royal Caribbean Cruise Lines received negative press in 1999 for its plea-bargained agreement to pay $18 million in fines for illegal dumping of waste oil and sewage in Alaskan waters. It had previously conceded similar dumping near Puerto Rico, only after being caught falsifying log records and submitting false testimony during a Congressional inquiry. Nonetheless, the company's annual revenues were more than $1.9 billion by September 1999, with gross profits of $686 million.

A 1998 newcomer to the cruise industry was Disney, spending $130 million to launch the Disney Magic in August 1999, followed by the launch of a sister ship, the Disney Wonder. The ships boasted 2,400 berths and three onboard restaurants through which passengers rotated during their cruise with the same wait staff, with a fourth restaurant reserved only for adults.

Despite weak economic conditions, rising unemployment levels, and concerns about terrorist attacks, CLIA reported that the North American cruise industry reported record years in both 2001 and 2002, helping sustain an annual growth rate that averaged more than 8 percent from 1980 to 2001. Some 7.6 million passengers went on cruises in 2002, the majority of which (7.5 million) cruised on CLIA member vessels. That year, North American passengers accounted for more than 86 percent of the passengers CLIA members served worldwide. By the early years of the first decade of the 2000s, cruises lasting between two and five days continued to grow in popularity. This category, which included some 2.6 million passengers in 2001, increased almost 640 percent over 1980.

In addition to marketing and public relations efforts aimed at assuring would-be travelers that it was safe to go on cruises, the industry offered attractive pricing to increase volume in 2002. Another innovative industry growth initiative involved so-called "drive-cruise vacations," as leading cruise lines introduced itineraries that originated in ports located near major North American cities. This helped address concerns of travelers in the wake of the terrorist attacks against the United States on September 11, 2001, and also opened the cruise market to those who were reluctant to fly.

The industry also was forced to address concerns about gastrointestinal illnesses on cruise ships after passengers and crew aboard a number of cruise lines fell ill. According to the Centers for Disease Control and Prevention (CDC), between January 1 and December 2, 2002, the agency investigated more than 20 reports of illnesses involving 17 ships. Among the ships affected during this time were Princess Cruise Lines' Sun Princess, Royal Olympic Cruises' Olympia Voyager, and Carnival's Carnival Spirit. Following these outbreaks, cruise lines were forced to transport passengers back home on airplanes and clean and disinfect their ships. In some cases, assistance also was provided by CDC's Vessel Sanitation Program.

According to the CDC, "Of the 21 outbreaks, 9 were confirmed to be associated with noroviruses, 3 were attributable to bacterial agents and 9 were unknown etiology." In 2002 the CDC confirmed 26 land-based outbreaks of gastroenteritis attributable to norovirus. Noroviruses, such as Norwalk-like viruses or NLV, are nonbacterial agents that can cause gastroenteritis. Symptoms include sudden onset of nausea, vomiting, and watery diarrhea that can last from 12 to 60 hours."

The First Decade of the 2000s.
In the first decade of the 2000s, the cruise industry continued to grow. The number of passengers worldwide was 9.83 million, of which 7.48 million were U.S. citizens. Between 2000 and 2003, the North American cruise industry introduced 20 new ships, adding some 50,000 lower berths. Over the same period, gross revenues increased $1.2 billion to $14.7 billion, and U.S. passenger revenues grew 25 percent from $10.3 billion in 2000 to $12.9 billion in 2003.

In 2004 Carnival launched 1,278 cruises with 3.1 million passengers, and Royal Caribbean launched 1,036 cruises with 2.6 million passengers. P&O Princess Cruises (owned by Carnival) was the third most popular cruise line, with 405 cruises and 936,000 passengers. Following Norwegian Cruise Line and Holland America Line (owned by Carnival), Celebrity Cruise Line (owned by Royal Caribbean) was sixth with 329 cruises and 600,800 passengers, and Disney Cruise Line was seventh in 2004, with 151 cruises and 395,900 passengers. Cunard Line (owned by Carnival), Costa Cruise Line (owned by Carnival), and Radisson Seven Seas Cruises rounded out the top 10 cruise lines.

The small ultra-luxury cruise lines also reported increased revenue during the middle of the first decade of the 2000s. Because the high-end sector was more severely affected by the economic recession at the end of the decade, the revival was especially good news. According to Dan Luzadder in the April 2005 issue of Travel Weekly, "Their wealthy and travel-savvy clients are filling ships, reflecting a rising demand from a broader segment of the affluent," Luzadder continued, "Bookings are coming in earlier, sellouts are happening more quickly and volume is up by 20 percent to 40 percent over the first quarter of last year."

Due to increasing demand, along with the higher cost of doing business in the luxury segment, which bases its revenues on fewer passengers per trip, Luzadder projected that the industry was prime for consolidation during the middle of the first decade of the 2000s. Merger and acquisition activity was anticipated to increase as companies tried to spread out costs and boost revenues. In 2004 Carnival's luxury liner company, the Yachts of Seabourn, carried an average of 183 passengers on 44 cruises, while SeaDream Yacht Club carried an average of 80 passengers per trip (Carnival Cruise averaged around 2,500 per cruise.) The luxury cruise lines accounted for about 5 percent of the market, compared to the contemporary market, which served 95 percent of cruise passengers.

Although the contemporary sector dominated the industry during the middle of the first decade of the 2000s, the lines between the mass market and luxury cruise experiences was blurred with the 2004 introduction of Cunard's Queen Mary 2. At 1,132 feet in length, the Queen Mary 2 was the world's largest ocean liner, able to hold 2,620 passengers and 1,253 crew members. With a service ratio of one staff member per traveling couple, Cunard attempted to emulate the small ultra-luxury liners, while continuing to appeal to the mass market by size. In 2007 Cunard launched the Queen Victoria. In 2010, the Queen Mary 2 and the Queen Victoria were joined by the Queen Elizabeth.

In 2008 almost 77 percent of all cruise passengers (10.15 million) were from North America. In 2006 the industry had 151 ships with 249,691 lower berths. The economic benefit of the U.S. cruise industry was nearly $38 billion in 2008, according to CLIA.

By capacity, about 80 percent of all cruises leaving from North American ports traveled to the Caribbean and Bahamas at the end of the first decade of the 2000s. The Western Caribbean was the destination of nearly 33 percent of passengers; the Bahamas, 15 percent; Eastern Caribbean, 13 percent; and Southern Caribbean, 10 percent. Other leading destinations included Alaska, Mexico, Europe, Bermuda, and Hawaii. U.S. ports accounted for 75 percent of all global embarkations. In 2006 the top three most popular U.S. ports for embarkation were all in Florida: Miami, Port Canaveral, and Port Everglades. Other popular ports of departure included San Juan, Puerto Rico; New York; Vancouver, British Columbia; Galveston; Tampa; Los Angeles; and New Orleans. Florida-based ports accounted for about 56 percent of passengers embarking from North America, although Texas was becoming one of the highest growth markets. In the middle of the first decade of the 2000s, the CLIA reported that the majority of cruise passengers come from Florida, California, Texas, Massachusetts, New York, Pennsylvania, New Jersey, Illinois, Arizona, and Georgia.

Cruise passenger numbers continued strong growth in the second half of the decade, reaching a record of more than 12 million, and major cruise lines spent much of the year sailing at over 100 percent occupancy rates. Growth continued into 2007, with sales so strong that the only limiting factor in the cruise industry continued to be capacity. According to the U.S. Department of Transportation, occupancy rates for the first part of 2007 were at 108 percent capacity.

In 2009 the U.S. Census Bureau reported that there were 253 establishments engaged in this industry in 2007, employing 21,393 people who earned approximately $981 million in wages. The industry as a whole generated revenue of more than $13.2 billion that year. Carnival Cruise Lines, Inc., and Royal Caribbean Cruise Lines, Inc., continued to dominate the North American market and at the end of the first decade of the 2000s accounted for more than half of all cruise passengers.

Current Conditions

The cruising industry continued to grow in the early 2010s. Twelve new ships worth a total of approximately $5.9 billion joined the CLIA in 2010, including one ship each from Celebrity Cruises, Costa Cruises, Holland America, MSC, Norwegian Cruise Lines, Royal Caribbean International, Cunard Line, Seabourn Cruise Line, American Cruise Line, and AMA Waterways, as well as two from Avalon Waterways. That year, almost 15 million people went on a cruise, 74 percent of whom were from the United States or Canada. The CLIA reported that the number of people taking cruises had increased more than 7.5 percent annually between 1980 and 2010.

Industry participants were also optimistic about the future. Based on a survey by the CLIA, 86 percent of travel agents expected cruise bookings to increase in 2011, whereas the Association itself predicted an increase in number of passengers to approximately 16 million. The top destinations remained the Caribbean and the Bahamas, followed by Alaska, the Mediterranean, Europe, and Hawaii. IBISWorld also forecast a bright future for the industry, despite the global recession at the end of the first decade of the 2000s that forced cruise operators to lower prices. According to IBISWorld, "the segment experienced growth in 2010 and is expected to do so again in 2011."

Cruise operators continued to increase and diversify their offerings in order to attract new and more customers. Trends in the early 2010s included the addition of more fitness facilities and equipment, spas, and interactive workshops and demonstrations, such as cooking, as well as an increase in dining options and theme-based trips, such as food/wine, music, an d art/culture.

Industry Leaders

Carnival Corporation.
Founded in 1972 as Carnival Cruise Lines, Inc., and renamed in 1994, Carnival Corporation, headquartered in Miami, Florida, was the largest cruise operator in the world, with 101 vessels that could hold a total of 190,000 passengers in 2011. In addition to Carnival Cruise Lines, which continued as an operating division, the company owned and operated 11 other cruise lines, including Costa Cruises, Cunard Line, Holland America Line, Princess Cruises, The Yachts of Seabourn, P&O Cruises, Ocean Village, Aida, and P&O Cruises Australia. In 2010 the company reported approximately 89,200 employees and earnings of $14.4 billion.

At the end of the first decade of the 2000s the Carnival Cruise Lines division of Carnival operated 23 ships offering mass-market cruises, including the Sensation, a 2,600-passenger superliner launched in 1993. That same year, Carnival signed a contract to build the largest cruise ship in the world capable of accommodating 3,000 passengers. Called the Destiny, it became the world's first 100,000-ton cruise ship upon its delivery in late 1996. In 1995 two other superliners, the Fascination and Imagination, were launched. The Carnival Glory was in service in 2003, followed by the Carnival Miracle and Carnival Valor in 2004, and Carnival Liberty, a 2,968-passenger ship, in the summer of 2005.

Royal Caribbean Cruise Lines.
Royal Caribbean Cruise Lines, founded in 1969 and also based in Miami, was the second-largest cruise line. It became one of the world's largest cruise lines by passenger capacity in the mid-1990s, offering more than 50 different itineraries ranging in length from 3- to 15-night cruises. In 2010 its 40-ship fleet, which had a combined capacity of more than 92,000, called at 420 ports. Among its fleet were the 3,100-passenger Navigator of the Seas; 2,100-passenger Brilliance of the Seas; 2,354-passenger Majesty of the Seas; 2,354-passenger Monarch of the Seas; 2,276-passenger Sovereign of the Seas; 1,804-passenger Legend of the Seas; 1,600-passenger Nordic Empress; 1,512-passenger Viking Serenade; 1,402-passenger Song of America; 1,004-passenger Song of Norway; 714-passenger Sun Viking. Between 1996 and 1998, five additional megaships were launched by Royal Caribbean: Splendor of the Seas, Grandeur of the Seas, Rhapsody of the Seas, Enchantment of the Seas, and Vision of the Seas. In 2010 Royal Caribbean, which also operates Celebrity Cruises and Pullmantur Cruises, reported revenue of $6.7 billion and 58,050 employees.

Celebrity Cruises.
Celebrity Cruises, founded in 1972, is one of the largest companies in the luxury segment of the cruise industry. In 1997 the company merged with Royal Caribbean. Celebrity Cruises introduced Royal Celebrity Tours in 2001, which provided travelers with "land-and-sea" packages. In 2006 the company operated nine cruise ships with a capacity of nearly 14,000.

Other Carnival Lines.
P&O Princess Cruises Plc was founded in 1965 by Seattle entrepreneur Stanley MacDonald, who leased the 318-passenger Princess Patricia, a converted ferryboat, from the Canadian Pacific Railway during the winter months and offered cruises between Los Angeles and Mexico. Princess continued to operate ships under charter until 1971, when it purchased the Island Venture, which was renamed the Island Princess. In 1974 Princess was purchased by the P&O Lines, a venerable British firm that added the Sun Princess to the Princess fleet. In 1977 Princess became the model for the hit television show The Love Boat, which provided market exposure to Princess and the cruise industry. In the late 1990s, Princess added the Dawn Princess, the sister ship to Sun Princess, and the 104,000-ton Grand Princess, reportedly the largest cruise ship built by that time. P&O spun off its Princess line in 2000. A failed acquisition attempt by Royal Caribbean in 2002 was followed by the company's acquisition by Carnival Corporation in 2003.

The Holland America Line, which Carnival purchased in 1988, is one of the oldest names in passenger ship history, dating back to 1873 and The Netherlands America Steamship Company. More than 1 million immigrants came to the United States aboard Holland America ships between 1873 and World War I. Holland America provided regular transatlantic passenger service until the late 1960s, when it retired the Nieuw Amsterdam and devoted attention to the cruise industry. Under Carnival's ownership, the Holland America Line added two new ships in 1993 and in 1994. Holland America offers premium-priced cruises to Alaska, Europe, and the Caribbean. In 1993 Holland America also resumed around-the-world cruising. In 2007 Holland America had a fleet of 13 ships and sailed to more than 300 ports on all seven continents. In 2004 the company introduced the Westerdam.

The Cunard Line, one of the oldest passenger ship companies in the world, formerly was a wholly owned subsidiary of the multinational Trafalgar House Plc, based in London. By the early years of the first decade of the 2000s, the company was one of six cruise lines owned by industry giant Carnival Corp. Founded in 1840 by Samuel Cunard to deliver mail between England and Halifax, Nova Scotia, the Cunard Line included such famous ships as the Lusitania, sunk by a German U-boat a year after the beginning of World War I, and the Queen Mary. Cunard headquarters were moved to New York in 1977. In the 1990s, Cunard offered cruises to more than 300 ports of call. It also was the only ship line providing scheduled passenger service between the United States and Europe.

Seabourn Cruise Lines, founded in 1987 by Norwegian entrepreneur Atle Brynestad, offered luxury cruises aboard three 200-passenger, all-suite ships, the Seabourn Pride, the Seabourn Spirit, and the Seabourn Legend. Along with luxury accommodations, the Seabourn ships offered underwater observation rooms and sea-level platforms for water activities. Seabourn was part of Carnival Corp., which first purchased a 25 percent interest in Seabourn in 1992.

Although Carnival acquired Windstar when it purchased Holland America, Carnival sold the Windstar Sail Cruises line to Ambassadors International Inc. in 2007. However, Windstar Cruises, founded by Circle Line Cruises in 1986, continued to offer luxury adventure cruises aboard four-masted schooners with computer-controlled sails. Each of Windstar's 440-foot windjammers, the largest sailing ships ever built, carried about 150 passengers in a yacht-like environment. Windstar's North American cruises were primarily to small warm-weather ports in the Caribbean and focused on water sports such as scuba diving and windsurfing. The line also offered cruises in the Mediterranean, South Pacific, and Southeast Asia.

Workforce

The majority of jobs aboard cruise ships generally fall into three categories: crew, food service, and accommodations. Crew comprises deck hands, engineers, and maintenance. Food service comprises all the jobs associated with running restaurants, including managers, waiters, cooks, and kitchen staff. Accommodations is composed of all the jobs associated with running a hotel, including reservations, laundry service, and housekeeping. The ships also employ numerous clerical personnel, activities directors, and managers of the on-board retail shops and passenger services. In addition, cruise ships are among the largest employers of entertainment, including singers, comedians, dancers, and stage actors for musicals produced at sea.

Although many onboard cruise line employees are not from the United States the U.S. Census Bureau reported that industry employment within the United States in 2007 totaled more than 21,000 U.S. residents, and wages totaled over $981 million. In addition, CLIA estimated that the overall cruise industry employed about 348,000 workers from the United States in 2006.

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