Troubles in Greece take big bite out of cruise lines

By ,   July 9, 2015 ,   Cruise Industry

The Greek economy is in financial crisis, a wicked undercurrent sinking the financials of major cruise line operators.

According to trade association CLIA (Cruise Lines International Association), direct cruise lines' spending in Greece stands at $620 million annually, the majority of which spent on wages thus supporting 11,000 jobs in Greece.

The country is the seventh-largest European beneficiary of direct cruise industry spending. CLIA estimates that in 2013-14, spending on cruise industry in Greece had risen by about 10%. 

If Greece exits the European Union, cruisers could prefer to avoid the country for fear of exposing themselves to social unrest and having a bad travel experience. For cruise lines, the uncertainty could have some profit-busting effects.  

For companies such as CCL (Carnival Cruise Line) and RCL (Royal Caribbean), Greece may become harder to market to prospective vacationers this and next year, possibly arising the need to discount European cruise packages. Another thing is that cruise vessels could be diverted from Greece in the near future, which would lead to considerable expenses to cruise companies in areas such as personnel and fuel.

According to CLIA, in 2014 16.4 million Europeans (30% of all cruise passengers in the world) booked a cruise, which is a 0.5% increase over 2013.