Carnival UK: Rising Bunker Costs Mean Cruise Ships Will Get Bigger

Carnival UK head David Dingle said the industry must focus on Asia

Rising bunker costs and expanding emissions regulations mean cruise ships of the future will be bigger and visit fewer ports according to David Dingle, chief executive of cruise company Carnival UK, industry magazine Travel Weekly reports.

Speaking at the Institute of Travel and Tourism Odyssey Supper Wednesday evening, Dingle said larger sized ships are necessary to provide the 10 percent payback demanded by a $500 million investment in a ship, but there are few berths that can handle ships larger than 400 metres long.

"Economies of scale is paramount and we have to slow down our ships to save fuel," he said.

"That's likely to mean that cruise ships will visit fewer ports and rather than being landmark ports they will be closer to home."

Dingle said that shift means that passengers must chose cruises for the ships themselves, not just the destinations, which makes larger vessels more attractive.

"This will be an industry of very large ships," he said.

"It's highly unlikely that we will have any small to medium-sized ships built again."

Carnival UK's parent company, U.S.-based cruise operator Carnival Corporation & Plc. [NYSE:CUK, NYSE:CCL], said reduced fuel costs helped its bottom line in recent months.

Dingle also predicted a continuing "economic shift" with wealth moving from the west to Asia.

"For the future this country really has to look east to support its economic growth," he said.

"We have to be inextricably linked with the part of the world where we have the biggest economic growth."

The cruise industry is increasingly focused on Asian markets, including Hong Kong, which is opening a new cruise terminal.