Chris Roberts: Port upgrade vital to harnessing growth of cruise market

Ports of Auckland. Photo / Brett Phibbs

Opinion

Let me be blunt: Auckland's existing port facilities are not big enough.

In the current debate over the development of Ports of Auckland, much has been said about the need to accommodate the bigger container ships that are arriving here, or whether they should go to other ports.

But for the cruise sector, there are no alternative ports. Passengers want to come to Auckland and spend their money enjoying the sights and activities of our biggest city.

Auckland is a vital call on any New Zealand cruise itinerary. It provides the opportunity for passengers from Europe, North America and Asia to fly in or out. And these are the "added-value" cruise passengers who spend extra time and money in New Zealand before or after their cruise.

The Tourism Industry Association has long advocated for better cruise ship facilities around the country but especially in Auckland. The industry's Tourism 2025 growth framework identifies cruise as a valuable opportunity for growth over the next decade.

Ports of Auckland has recognised the need for better cruise facilities but these plans have now been thrown overboard by the wharf extension debate.

It was recently announced that the biggest cruise ship to visit New Zealand, Royal Caribbean International's Ovation of the Seas, would arrive in late 2016. At 348m long, it has a maximum capacity of 4900 passengers and 1300 crew, making each visit equivalent to 12 Airbus A380s arriving at the same time.

Ports of Auckland has now advised that due to the change in its development plans, it will not be able to accommodate the Ovation of the Seas. This ship visit is too valuable to lose so every effort must be made to find a solution. The loss to Auckland is $12.4 million, while the cost to the wider economy could be $40.4 million.

As well as spoiling visitors' impressions of Auckland, the lack of suitable berthing facilities also stymies Auckland's chances of extracting even more value from the cruise sector. With better facilities, cruise ships could start and end their voyages in Auckland, creating extra spend in overnight accommodation and ship provisioning. On average, such extras are worth 40 per cent more than the one-day cruise ship visits Auckland currently gets. If we consider that the cruise sector is already worth $159 million to the city and supports 2680 jobs, the potential value-add is clear. It would create numerous jobs and business opportunities.

New Zealand's cruise sector has grown by five times over the past 10 years.

And Chinese consumers are starting to discover the attractions of cruising. Cruise lines estimate that demand from China alone will triple the size of the global cruise market.

With more cruise ships being deployed into Northern Asia to meet demand, we expect many will head for the South Pacific during the Northern Hemisphere winter. This is an enormous opportunity for New Zealand - if we have the port facilities to cope.

The development of the Ports of Auckland must include improved facilities for the largest cruise ships. The economic benefits will be huge, not only to Auckland but the rest of New Zealand. Cruise ships currently visit 17 ports around the country, contributing $365 million a year to the national economy.

Forecasts show no sign of this growth abating.

The growth of cruise is a worldwide phenomenon and Auckland is key to its growth here. Our biggest urban centre has ambitions to be a truly international city. Without adequate port facilities, it will be an international embarrassment. Auckland and New Zealand risk being left off the map by the cruise industry and if that happens we will be many hundreds of millions of dollars worse off as a nation.

Chris Roberts is chief executive of the Tourism Industry Association.