As the cruise industry continues its steady and spectacular growth, the Los Angeles Harbor Commission has approved increased passenger tariffs for cruise ship passengers. From 2024 through 2028, the per-passenger rates will be hiked by 3% each fiscal year.
Cruise lines have already told the Port of Los Angeles they agree with the hikes, which are typically passed on to guests sailing onboard. Plans are also being developed for an additional cruise terminal in the outer harbor area. This decision aligns with the port officials’ anticipation of a booming cruise industry in Los Angeles and throughout the United States.
A Thriving Hub for Cruises
Although the Port of Los Angeles does not come close to the passenger numbers that major ports such as Port Miami, Galveston, or Port Canaveral record each year, the port is still a big player, with a projected 1.3 million passengers passing through the port this year.
To ensure the port profits from the increasing number of passengers passing through, on Thursday, August 24, the Los Angeles Board of Harbor Commissioners authorized tariffs that will incrementally rise from the current rate of $16.12 per guest to $19.25 by July 1, 2028.
The increased tariffs are levied on cruise lines, such as Princess Cruises, Royal Caribbean, and Norwegian Cruise Line, all now based at the Port of L.A., but are typically passed on to guests.
This decision follows an expected surge in the cruise business in Los Angeles. The port is also considering upgrading existing facilities and developing an additional cruise terminal at San Pedro’s Outer Harbor, with a request for proposals expected to be released by the end of this year.
Chris Chase, assistant director of marketing: “We’re filling up. And along with our team here, we are looking at some alternative sites for new development. And it’s there in the outer harbor, berths 46 and berth 50, that have been identified as locations where we could support large cruise ships building for the future.”
Chris Chase also stated that the plans for upgraded and new cruise terminal spaces are a positive development for the port and businesses in the area. However, not everyone agrees.
Some locals have long voiced their concerns regarding the new cruise terminal at the outer harbor location, which could potentially block views of the shoreline. One commissioner also mentioned potential problems in Mexico being an issue for the Port of Los Angeles, seeing that most cruise ships sailing from LA have itineraries to the Mexican Riviera.
Commissioner Ed Renwick: “As a whole, though, this is an industry that’s scary to invest in, in terms of new capital, because the moment there is political disruption in Mexico, the ships all go elsewhere.”
Increased Interest in West Coast Cruises
According to port officials, about 1 million passengers took Port of LA cruises during the 2022-23 fiscal year, a number expected to grow to 1.4 million by 2025-26.
Much of the increase in numbers is due to renewed interest from cruise lines in West Coast itineraries. While Royal Caribbean had been absent from LA for over a decade, the cruise line now brings more passengers to the port than any other line. Princess Cruises, which has operated from Los Angeles for decades, announced increased cruises to Alaska from LA.
On the financial side, per cruise ship visit, the local economy in a 3-5 mile radius from the port benefits some 1 million dollars. Should Los Angeles wish to bring in more cruise ships and increase that economic benefit, investments must be made now to profit from the massive growth the cruise industry is seeing in the US.
U.S. Cruise Ports: Investing in a Growing Industry
The growth in the cruise industry in the United States is prompting a spur of investments among most major cruise ports. In line with the developments at the Port of Los Angeles, Port Canaveral near Orlando, Florida, the world’s busiest cruise port, has plans to construct two additional parking garages, with an investment of over $67 million, set to be completed by the end of 2024.
Port Canaveral has also announced it has plans to expand the number of cruise terminals in the port, with a new terminal proposed for late 2026.
Likewise, Galveston Wharves is negotiating to develop a fourth cruise terminal with MSC Cruises and Norwegian Cruise Line, a public-private partnership emphasizing the port’s rapid growth following the successful construction of a new cruise terminal for Royal Caribbean International.
PortMiami has invested heavily in recent years with new cruise terminals constructed for Norwegian Cruise Line and Virgin Voyages.
These investments across various ports signal a unified move towards capitalizing on the booming cruise industry in the United States. It’s an exciting time for the industry and the millions of guests eager to explore the world from these major U.S. hubs.
The continued development and growth in the cruise sector reflect a bright future for both the ports and the guests they serve.