Steady as she grows: number of annual cruise passengers to double by 2020, says report.

Steady growth over the next 15 years will double the number of annual cruise passengers to 27 million by 2020, according to a new report.

The report, "The World Cruise Shippng Industry to 2020, A Detailed Appraisal of Prospects," projects cruise market and shipbuilding demand worldwide over the next 15 years. The author of the 240-page report is the U.K.'s Ocean Shipping Consultants Ltd.

The OSC report estimates that 13.6 million passengers will cruise in 2005, climbing to 18 million in 2010, 22.6 million in 2015 and 27 million in 2020. North America is expected to account for about 64% of the total in 2020 and Europe about 26%.

Over the next five years, OSC estimates an annual cruise passenger growth rate of 5.75% per year until 2010, a little over 4.5% per year in the first half of the next decade, and around 3.75% until 2020.

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BIGGER SHIPS

Cruise ships aren't really ships at all. They're all-inclusive resorts that just happen to float and move around. Onboard amenities and activities include everything from rock climbing, ice skating and water skiing to shopping, gambling and dancing. The trend has been to cram more activities onboard and revenue-generating berths. This has led to a dramatic rise in the number of large passenger capacity ships in the fleet.

According to the OSC study, since 1995, the total number of berths for ships with 1,000 to 2,000 passenger capacities has increased by about 120%, and by over 30% since 2000. The most dramatic rise, however, has been for cruise ships with more than 2,000 berths. Since 1995, the berth capacity of ships with more than 2,000 passenger capacity has jumped by over 600%, from about 17,000 to 126,000 berths. Most of this expansion has occurred in the near term, with around 45,000 berths since 2000.

Over the last 10 years, the total number of berths in the world cruise ship fleet has nearly doubled from around 160,000 at the beginning of 1995 to over 310,000 in 2005.

NEED FOR MORE SHIPS

Based on the current orderbook, it appears that the trend towards larger capacity ships will continue. About 91% of all vessels on order are above the 1,500-berth capacity. Currently, vessels of over 1,500 berths represent just 27.5% of the existing fleet.

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