- Cruises could go for bargain prices this summer as operators try to fill cabins.
- Some cruise prices have fallen by $1,000 this year, data reported by Reuters suggests.
- Carnival told Insider its prices had been "at the higher end" this year.
Cruise holidays could be as cheap as they've ever been this summer, despite soaring inflation.
Cruises are slowly making a comeback as pandemic restrictions end, but wafer-thin margins mean leading lines are likely to cut prices to cope with lower demand, according to analysts.
"Prices are down as there is too much unsold capacity and the cruise lines need to sail with their ships as full as possible to cover their very high fixed costs," Patrick Scholes, a leisure analyst at Truist Securities, told Insider.
"Cruise lines are offering lower prices and deals to attract customers in the hope that they will continue to spend while onboard."
In its latest earnings report, Carnival said occupancy in the second quarter of 2022 was 69%. Scholes said this spare capacity meant it would be forced to offer discounts.
Scholes previously told Reuters: "Your typical Carnival, Royal Caribbean or Norwegian Cruise this summer to the Caribbean is about as cheap as we've ever seen it." He also said there were 13% more ships at sea compared with pre-pandemic levels.
According to Cruise Critic data seen by Reuters, the average cost of a five-night Caribbean cruise for two in June fell from about $3,000 this time last year to $2,000.
Falling fares buck the trend of rising inflation. Air fares have jumped nearly 38% this year as fuel prices and labor shortages are passed onto customers, making cruises more attractive.
It also contrasts with steeper cost pressures for cruise lines. In May, Insider reported that some cruise lines were being forced to cancel sailings, close on-board restaurants, and shed capacity owing to a lack of staff.
But while Scholes told Insider that "cost increase drivers for the cruise industry are similar to cost increases for everyone else, whether it be for fuel and food," he said there was now less pressure on labor costs due to staffing being sourced from countries such as the Philippines, Vietnam and India.
A Carnival spokesperson told Insider: "While there are always attractive cruise offers being promoted by our brands, across the company, advanced bookings have been at the higher end of the historical range at higher pricing."