Economic Impact: Cruise Boom Benefits Port Communities

 

At the eastern end of the Canadian province of Nova Scotia on the island of Cape Breton sits the small port of Sydney. By comparison to dozens of other North American ports, it's small potatoes. But what's important, and even vital, to Sydney is the revenue generated by its cruise industry.

In 2024, Sydney had a record year with 117 vessel calls, 13,297 passengers arriving on 20 cruise lines and millions of dollars in economic activity. Again, in comparison to the Miamis of the world, small potatoes. But big impact.

For both large and small ports, figures show the growing economic impact of cruising. Cruise Lines International Association's (CLIA) global economic impact study in 2023 "revealed the highest-ever global economic impact from cruise tourism and reaffirmed that 2023 surpassed 2019 as the benchmark year for cruise industry performance." The report also confirmed the cruise sector's role as a "robust job creator." According to the study, the global cruise industry in 2023 generated $168.6 billion in total economic impact, a nine percent increase over 2019.

And 2024 was even better, although final figures are not yet in.

Cruise lines are riding the wave of popularity with over 25 cruise ships on order in the next two years, according to a Travel Market Report. Capacities will range from 100 to 6,700 passengers. Cruise ports also continue to see the ever-growing importance of cruise and are investing in infrastructure with a continued focus on clean energy.

New Records

In 2025, the Port of Seattle will mark its first full season with all three of its cruise berths having shore power capability. The installation of shore power at the Bell Street Cruise Terminal at Pier 66, a $44 million investment, made Seattle capable of providing shore power simultaneously to three cruise ships, eliminating harmful emissions.

"With the installation of shore power at Pier 66, I'm proud to say Seattle is one of the only ports globally able to simultaneously power three cruise ships with low-carbon electricity," says Port of Seattle Commissioner Fred Felleman. Seattle has announced all homeported cruise ships will be required to plug into shore power by 2027, moving the original target date up by three years.

Seattle is also expecting new cruise lines.

"This summer we'll welcome the Queen Elizabeth from Cunard for a series of 10- and 11-day cruises from Pier 91," notes Brad Olsen, Senior Manager of Maritime Marketing. "In addition, existing homeport brands are deploying larger ships in 2025 including Norwegian's Joy and Oceania's Riviera. In 2026 we'll see MSC and Virgin Voyages sailing seven-day cruises from Pier 91."

Seattle posted 275 ship calls and 1.75 million passengers last year. The preliminary schedule for 2025 includes 299 vessel calls and an expected 1.9 million passengers. "We'll continue to set new records for cruise traffic," Olsen says.

Linda Springmann, the port's Director of Cruise & Maritime Marketing, adds, "Cruise passengers are a crucial part of our economy's success and contribute significantly to Seattle's vibrancy. Plus, SEA (Seattle-Tacoma International Airport) has strong international reach, which means cruise lines can attract international visitors who tend to stay longer, go further into our region and spend a little more."

Banner Year

It's expected to be a banner cruise year for the Port of Galveston as the port celebrates its 200th birthday.

"Galveston is the fourth most popular cruise port in North America and eighth busiest in the world because our cruise partners offer a great product and because of our location," exclaims Galveston Wharves' Port Director Rodger Rees. "As the only cruise homeport in Texas, we serve much of the central U.S. and beyond, offering more sailings to more destinations on newer and larger ships. We host Carnival, Disney, Norwegian, Princess and Royal Caribbean."

In 2024, a total of 3.4 million passengers moved through Galveston's three cruise terminals, a new record in the port's 25-year history as a homeport. More than 380 cruise ships called in 2024, another record. In 2025, the port forecasts more than 400 sailings and almost 3.6 million passengers. To meet the growing demand, the port will open a fourth cruise terminal in 2025. The $156 million terminal will be home to MSC and Norwegian cruise lines.

Similar to many ports, Galveston's cruise industry is a major economic engine for local and regional businesses. In 2023, cruise operations generated 4,547 jobs, $733 million in business revenues, $291 million in personal income and $25 million in state and local taxes.

The port's cruise operations are located adjacent to Galveston's historic downtown, filled with restaurants, shops, galleries and attractions. More than a third of cruise passengers stay in local lodging before or after their cruises to enjoy the many attractions.

Powering Up

Florida's Port Everglades, the third busiest cruise port in the world, has jumped on its own clean energy bandwagon and completed a study to add shore power to its eight cruise terminals.

The study by Moffatt & Nichol, a global infrastructure advisory firm working in cooperation with Florida Power & Light (FPL), Carnival Corporation, Disney Cruise Line and the Royal Caribbean Group, recommended a plan to deliver up to 16 megawatts of electricity simultaneously to each of the eight terminals. The projected cost, including estimates for FPL upgrades, is approximately $21.5 million per terminal for a total of $172 million. The project is expected to be financed through federal and state grants, contributions from FPL, the participating cruise lines and Broward County.

"In just the first few months of our fiscal year, we're seeing solid growth in our cruise business," says Joseph Morris, CEO & Port Director at Port Everglades. "There are cruise ships making more visits to our port and we anticipate a record 4.4 million cruise guests this year. We're also making progress on our Master/Vision Plan Update that will improve the experience for cruise lines and their guests, and we're powering forward with plans to renovate Terminal 29 for the Royal Caribbean Group."

Port Everglades, which hosts 10 cruise lines and a ferry, welcomed more than four million guests in FY 2024, a 39 percent increase over FY 2023 and a new record. There were 889 ship calls including 241 calls from Baleària's Caribbean ferry. Disney Cruise Line opened its second homeport at the beginning of FY 2024 and joined Celebrity, Princess and Royal Caribbean with year-round sailing itineraries.

Terminal Upgrades

On the California coast, at the Port of San Diego, shore power will be a sure thing.

The port's Board of Commissioners has approved a contract for an additional shore power outlet to enable vessels with starboard connections to access shore power at the B Street Cruise Terminal's south berth, adding further versatility to the existing system. The shore power addition will be accompanied by other infrastructure work.

Early this year the port is expecting to have the construction and design document completed for the B Street Cruise Terminal's upgrades with construction beginning as soon as late summer and completion sometime in 2026, states Josh Kellems, Principal Marketing & Public Relations Representative: "Terminal upgrades will include expanded security screening, new bathroom facilities, improved lighting and new flooring."

The port anticipates 265,000 passengers in 2024-25 and 324,000 in 2025-26.

In addition, notes Kellems, "We're excited to have a six-call increase with Holland America Line in the 2025-2026 season with the Nieuw Amsterdam being homeported in San Diego." The port will also welcome a new cruise ship in the 2025-2026 season, Virgin Voyages' Brilliant Lady.

We're #1

At PortMiami, the world's leading cruise port with over 8.2 million passengers, up 12 percent in FY 2023-24, it's only fitting it should be home to a massive new cruise facility. MSC Cruises will open the world's largest cruise terminal this year in Miami, able to accommodate two MSC ships simultaneously.

In addition to the new terminal, the port has launched a shore power program. In partnership with Miami-Dade County, Carnival Corporation, MSC Cruises, Norwegian Cruise Line Holdings, Royal Caribbean Group, Virgin Voyages and FPL, PortMiami is the first major cruise port on the U.S. eastern seaboard offering shore power capability at five cruise berths. In the coming year, 21 cruise ships will be outfitted for shore power and will connect in Miami. The seaport will have more than 350 vessel calls plugging into its shore power system.

"We're committed to being a sustainable global gateway," says Hydi Webb, PortMiami Director & CEO. "We thank our mayor, county commissioners and port partners for their continued support of our resilience initiatives."

Ports columnist TOM PETERS writes from Halifax, Nova Scotia.