You might be surprised to find out that the cruise industry is thriving and has become a multi-billion dollar annual business.
With many of the top lines in the world making more than $1 billion per year. But why are Cruises so expensive?
Cruises are expensive for a number of reasons. The cost varies depending on the line type, destination, and time of year that you choose to go.
The size of the ship and luxury amenities are part of what makes cruises so costly, but there are other reasons as well.
Cruise lines are constantly adding new features and amenities for their guests in order to differentiate themselves from the competition and attract a larger share of market share.
That’s why cruise ships today have everything from water slides to rock climbing walls.
And all those fancy extras come at a cost, which you’ll see below. Here are some of the reasons your next cruise is going to be expensive.
Why are Cruises so Expensive
Here let’s take an in-depth look into the five biggest factors that affect pricing on cruises.
Most of the time, you can find a way to save money on cruises, but it’s important to understand how these factors affect cost so that you can make educated decisions about when and where to book your next cruise.
5 Most Important Factors That Make Cruises So Expensive
1) Size Of The Ship And Luxury Amenities
The biggest factor in determining the cost of a cruise is how big your ship is and what level of luxury it offers.
In general, you can expect to pay more for a bigger ship with more amenities than those with less square footage and no extras.
The larger the ship typically means it will have more amenities and perks.
However, it also increases both fixed and variable costs associated with running the vessel, which passengers must pay for in higher fares.
Cruise lines are constantly building larger and faster ships to cope with the growing demand for cruising each year, which means their costs go up as well.
Bigger ships also require more crew members, which increases the labor expense per passenger on board, along with insurance fees for ports of call where there have been recent terrorist attacks.
The extra space onboard means room for much bigger cabins and public spaces like swimming pools, hot tubs, restaurants, and bars.
Another important factor to consider is where you are cruising.
Cruise prices tend to be higher in popular destinations, which means they rise as the competition between cruise lines heats up.
For example, it’s much cheaper to sail out of a port that isn’t near any other major ports. No matter how big the ship is or what amenities it offers, people won’t pay too much if there aren’t any nearby options to choose from.
On the other hand, if several ships offer cruises from one particular port simultaneously each week during high-demand periods like summer vacation and the Christmas holiday season.
You can expect to pay more onboard than somewhere with less demand for cruises.
In short, more supply means lower demand, and lower demand means you won’t have as many options to choose from.
3) SEASONALITY AND TIME OF THE YEAR
Cruising is most popular during the summer months for warm weather and winter months for those who want to avoid cold winters at home.
The cost of your cruise will vary based on when you travel since cruising is often most expensive around special occasions such as Memorial Day, Fourth of July, Thanksgiving, Christmas, and New Year’s Eve.
These peak times all have very high demand, which drives up prices and makes cabins harder to find unless you book early.
The time of year also affects pricing because many destinations like Alaska or Bermuda have better weather during certain times versus others.
Winter months tend to have cooler temperatures than summer but not quite as cold as spring/fall periods, where it’s warm enough for poolside relaxing but cool enough to allow for more activities.
5) LINE TYPE & OCCUPANCY RATIOS
Another major factor on why cruises are so expensive is the cruise line you sail with.
In general, bigger cruise lines can offer a higher quality of service and amenities than smaller ones, which means they can charge higher prices for a better experience.
There are three different types of cruise ships: luxury (smaller and more upscale), premium (larger and mid-scale), and mass-market (largest and least expensive).
These categorizations refer to the pricing distribution curve, where the most luxurious ships have lower occupancy ratios while larger vessels hold more passengers.
Cruise lines that cater to younger demographics tend to be cheaper because their target audience has less money/more demand than older travelers who book cruises more frequently.
So if you are young and on a budget, look for ships that mostly cater to this demographic.
Also, consider traveling in the off-season so most cruise lines won’t have too many empty cabins to fill, which could lower your fare significantly depending on how desperate they are to fill those seats.
Frequently Asked Questions about Cruising Prices
When Is The Best Time To Cruise?
The best time to cruise is during the off-season (when it’s least expensive). However, you can still find good deals around popular travel times like summer vacation, Christmas holiday season, and New Year’s Eve.
How Long Are Cruises?
The length of a cruise depends on the destination. Short trips tend to last about 4 days, while longer ones can take up to 10 days or more.
What If I Don’t Have Much Money?
Cruise prices vary based on your age and whether you’re traveling alone/with friends/family members. So young people traveling solo will find lower fares than older couples who are married with children.
Also, prioritize shorter cruises over longer ones because longer cruises are usually more expensive, especially the standard week-long trips.
If you still don’t have much money, look for last-minute deals or cruise offers and discounts available through your frequent flyer points program.
Final Thought on the Price of Cruises
Cruise prices vary widely based on the type of traveler you are, when and where you travel, and the cruise line you travel with.
These factors can make a huge difference in your final fare. If possible, It’s recommendable you booking early for cheaper fares and traveling during the off-season (when it’s less crowded),
so you have more options to choose from. But why are cruises so expensive? Now you know.