Genting Builds Cruise Fleet With Ambitions Beyond Asian Waters

Asian cruise pioneer Genting Cruise Lines unveiled its global ambitions at Skift Forum Asia this week, counting the days to when its Dream Cruises will have ships that are positioned beyond Asian waters.

Two Global-class ships that are being built in Genting’s German shipyards will join the Dream fleet from early 2021. “We can then start to explore [positioning a ship in] Australia/New Zealand, Alaska, and beyond,” said Thatcher Brown, president of Dream Cruises and managing director, Asia, of Crystal Cruises, during his session at the forum.

Dream currently operates only in Asia with two new builds, Genting Dream, based in Singapore, and World Dream, home ported in Hong Kong/Guangzhou.

A third ship, the former SuperStar Virgo, which underwent a $56 million transformation, joined the Dream fleet last month as Explorer Dream and will home port in Tianjin from July 1, then Sydney and Auckland from October 2019.

The brand is a young one, even though parent Genting Hong Kong pioneered Asian cruising 25 years ago with Star Cruises. In fact Genting started ramping up its cruise efforts only in 2015, when it bought U.S.-based ultra-luxury cruise line Crystal Cruises, then launched Dream Cruises in 2016 as “Asia’s first luxury cruise line,” in response to demand from Asian cruise passengers for ever better ships with more bells and whistles.

It also bought its German shipyards, MV Werften, in 2016 out of concern its new ships wouldn’t get built due to an all-time high of ship orders.

“When you have your own yard, you can manage the cadence of your development and the quality of your ships,” said Brown.

Asian Market Growth

Genting’s Global-class ship, at 204,000 tonnes, is bigger than the first two Dream ships, which are 150,000-tonne vessels. It can accommodate up to 9,000 passengers, thanks to a “concept of multiple berths,” said Brown.

He said Genting wants to “leverage Asia’s growing market.”

Brown remains optimistic about filling up those ships with largely pan-Asian customers, even though he acknowledged that geopolitics like the U.S.-Sino trade war or elections unrest in Indonesia does affect the market’s growth.

“Demand in Europe grows 3 percent a year. Here it is about 30 percent,” Brown pointed out, referring to markets such as Singapore, India, Indonesia, the Philippines, and Vietnam, which last year grew at rates of between 28 percent and 55 percent, according to figures from Cruise Lines International Association (CLIA).

The Asian cruise market size is 4.24 million passengers as of 2018, representing 15 percent of total global passenger volume, CLIA figures show. Cruise penetration is still low, which means the market still has a lot of upside, said Brown.

Drivers of continued growth include rising middle class and growing appetite for travel. Transport infrastructure development in the region, including high-speed rail in China and air links in Asia, are helping to carve healthy rail-cruise and fly-cruise markets, he said.

Brown pointed to the healthy Indian fly-cruise market in Singapore as an example, and how the new Jewel at Changi is making it even more attractive for fly-cruise passengers.

“Look at Jewel, you can fly in, stay at the lounge, check your bags all the way to the ship, have a shower, shop, get a transfer to the ship,” he said.

Asked about the China market, which slowed down last year albeit marginally by 1.6 percent due to a capacity reduction, Brown said the correction was needed.

“In 2015, it [China] was the Wild West. Some brands were sending four ships at a time as quickly as possible, yields were high, you saw 64 percent growth in supply even in one year,” he recounted. “Brands started getting nervous when supply outpaced demand and started to pull back in 2017.”

Crystal Clear

Asian markets, be it Taiwan or Indonesia, are also “very strong” for Crystal Cruises, according to Brown, illustrating Asians’ high spending power and keenness for unique experiences.

Genting is building a third ship for Crystal, a Polar-class, all-suite expedition ship that can accommodate 200 passengers. “The average rate is $1,500 a day. There is demand for that [from Asians],” said Brown.

Asked if Genting’s new direction for Crystal is focused on smaller, exclusive products such as polar ships, river cruises, and yacht cruises, rather than ocean cruising, Brown said, “One of our challenges is getting first-timers. The level of [cruise] awareness, with the exception of Australia, which is a mature market, and Singapore, is a long way to go. By introducing these new products, we can start to cross sell.”

Genting even introduced a Crystal Air product, which Brown said “is a branding exercise” to attract Asians to cruise. Clients could, say, charter the Boeing 777 and fly to Iceland, then to Venice to board a Crystal yacht that takes them to Dubrovnik, and get on the plane to fly home.