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Frank said Carnival's only Asian cruise ship, the 800-passenger Costa Allegra, was expected to show improvement in sales in the second half of this year after poor business in the first half.
Carnival is learning how to properly market cruise vacations to entice Chinese travelers, while also adjusting itineraries to offer longer Asian cruise vacations to European and North American travelers.
But an expansion of passenger capacity in the region may be a year or two away, Frank said.
"It looks like we're going to have to build the Chinese market a little slower than we thought," Frank said.
The Asian cruise market has plenty of potential due to the region's growing spending power, improving ports and exotic destinations. Asian travel officials have predicted that cruising will grow 40 percent to 1.5 million passengers in 2010 in the region.
The Costa Allegra sails between Hong Kong, Indonesia, Japan, the Philippines, Singapore and South Korea. Royal Caribbean's 1,998-passenger Rhapsody of the Seas will become the largest ship in the region when it begins its deployment in late November.
However, the market is still in its infancy, and cruise operators face challenges with building demand because of the average Asian traveler's lack of familiarity with the all-in cruise vacation. Other obstacles mentioned include poor infrastructure, security and high deployment costs.
Officials from China are using the 2008 Olympics to promote a triangle of northern cruise ports, and the Port of Shanghai is investing in a 300,000-square-foot terminal to handle three cruise ships.
"We need to be in Asia," Frank said.
Carnival competitor Royal Caribbean Cruises Ltd., has announced it will start sailing in Asia in December.
quote:However, the market is still in its infancy, and cruise operators face challenges with building demand because of the average Asian traveler's lack of familiarity with the all-in cruise vacation.
It doesn't help that, for those who have cruised before, the ship is small and old. And for those who haven't cruised before, the ship doesn't match the "wow" expectations and doesn't impress.
It is a new concept to the area. It appears hard and fast gambling is what one is used to on a ship, for one night, not several nights of relaxation. It will be slow to build up business of something entirely new and 'alien'.
Pam
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