Ports need better facilities to help cruise industry grow

By Amelia Wade

Cruising is the fastest-growing tourism sector and has huge potential, with the country's popularity as a destination skyrocketing and the number of passengers growing by more than 250 per cent in five years.

This cruise season is estimated to put $114.9 million into Auckland's economy. Photo / Supplied
This cruise season is estimated to put $114.9 million into Auckland's economy. Photo / Supplied

New Zealand's ports are at a critical point - improve their infrastructure to support the expanding cruise ship industry or lose the business of its biggest vessels.

The upcoming cruise season is estimated to inject more than $327 million into the economy and support at least 5600 jobs.

And that's expected to increase as ships get bigger and as the widening of the Panama Canal is completed.

"The cruise lines are telling us to expect more of their big guys, but at the moment we can't accommodate them," said Cruise New Zealand chairman Craig Harris.

"We do not have purpose-built terminals, with the exception of Queens Wharf in Auckland which was built in the late 90s when the average size of the ship was 670 passengers, and now we're getting ships of over 3000 passengers so obviously it's inadequate."

The cruise industry is the fastest-growing tourism sector and Tourism New Zealand said it had a huge amount of potential for growth.

New Zealand's popularity as a cruise destination has skyrocketed - the number of cruise passengers has increased by more than 250 per cent in the past five years.

Total annual cruise visitor numbers have now outgrown the country's fourth-largest inbound tourism market, China.

Mr Harris said not only would the number of cruises stopping at our ports continue to rise, but the ships would be bigger, longer and have more passengers.

By the 2014-15 cruise season, the widening of the Panama Canal will be completed, opening up New Zealand as a destination to a slew of countries.

As it stands, it's very expensive to travel from Europe or America and so New Zealand is seen generally as a South Pacific-only option. But the new passage will allow some of the largest cruise ships in the world to venture into our waters.

Mr Harris said our port facilities - which primarily support cargo ships - might struggle with the added demand.

"We're at a critical point for New Zealand and at a very critical point for Auckland. There are more ships so you've got more to berth and the second-most important thing is that we're getting very large ships here - ships over 300 metres long which is bigger than any of the container ships that come into the ports of New Zealand," he said.

There was not enough focus being put on supporting the growing cruise industry, Mr Harris said.

"Up until now we've been reasonably self-sufficient in terms of our ports' infrastructure but we've reached a point where local councils, port authorities and the industry need to start working together."

And at the crux is Auckland.

"Unless Auckland works, the rest of New Zealand won't work. That's the critical issue. We need to get Auckland right to accommodate these big ships and we're about halfway there at the moment," Mr Harris said.

"Once that's completed, it'll put us in good shape as a turnaround port and the next part of the puzzle is if we can fit these ships into the other ports."

Auckland is the country's only exchange port - people fly into New Zealand before boarding a ship or fly out at the end of a cruise.

It is also the main beneficiary of passenger spending as well as the cruise company restocking the ships with food, fuel and supplies.

This cruise season is estimated to put $114.9 million into Auckland's economy.

The city has already invested in cruise infrastructure with a new facility being built in Shed 10 on Queens Wharf.

The cruise terminal will be ready for next year's cruise season and will double the size of the present facility on Princes Wharf.

Waterfront Auckland said it was part of a wider progressive strategy for the delivery of cruise infrastructure being developed with Ports of Auckland that would "ensure future investment keeps pace with the projected growth in the sector".

Jason Hill, manager of tourism at Auckland Tourism Events and Economic Development, said cruise companies matched every dollar spent by passengers with what they spent on provisions.

"There's more to it than meets the eye," Mr Hill said.

As an exchange port, Auckland receives two types of passenger - those who fly in and stay for a few days before boarding, and those who arrive on a ship.

Mr Hill said the former were a lot more valuable to the economy than the latter who have to be drawn off the ships.

Cruise operators and travel agents have been pushing day tours to places such as Te Hana or Matakana.

However, most didn't like to venture too far away from the ship so chose to stay downtown, maybe taking a hop-on, hop-off bus tour around the most popular central attractions.

Tourism Bay of Plenty chief executive Rhys Arrowsmith said they also knew how valuable cruises were to their economy. The upcoming season is estimated to inject $40.7 million into the region.

Mr Arrowsmith said it wasn't just the money the passengers spent while docked at Tauranga - in the last couple of years local businesses have noticed a jump in the number of cruise visitors returning.

"Moteliers said they've had people come and stay with them for a week after coming here on a cruise and getting a taste a couple of years ago. I think we'll see those types of return visitors increasing more and more over the next few years," Mr Arrowsmith said.

The region has invested $140,000 in an i-Port, a welcome centre made of shipping containers, at the Port of Tauranga.

The facility was designed for passengers who did not have pre-booked tours and wanted instead to wander around Mt Maunganui.

Tourism Industry Association New Zealand chief executive Martin Snedden said there had been a change for the better recently in the attitude towards cruises.

"I think there was a very low level of awareness in New Zealand about this growing opportunity and I think that's turned around in the last few months."

The cost of marketing New Zealand to cruises was very low as the companies did that themselves, so the return from the industry is very high.

Mr Snedden said our challenge was to ensure we service the growing cruise industry to a high standard and that came down to two factors.

The first was making sure our port facilities were continually evolving and second was the local tourism operators being on top of their game "in terms of luring the passengers off the ship and giving them a quality experience so they enjoy themselves and also the local communities make the most of the economic benefit".

Economic impact 2012-13

130 cruises
756 port visits
209,000 passengers
92,000 crew
$474.5m spent by tourists
5633 jobs supported


Regional forecasts

Northland - $13.1 million and account for 252 jobs
Auckland - $114.9 million and account for 1755 jobs
Bay of Plenty - $40.7 million and account for 732 jobs
Gisborne - $100,000 in value-add (no figures for jobs)
Hawkes Bay - $23.3 million and account for 429 jobs
Wellington - $43.2 million and account for 793 jobs
Marlborough - $6.7 million and account for 119 jobs
Canterbury - $35.6 million and account for 655 jobs
Otago - $42.8 million and account for 799 jobs
Southland - $6.7 million and account for 94 jobs.

Source: Economic Impact Assessment of NZ Cruise Sector

- NZ Herald

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on production bpcf01 at 23 Nov 2014 13:22:56 Processing Time: 552ms