If you're looking for a bright spot at the ports of Los Angeles and Long Beach amid the downturn in international trade, just turn to the bigger and more glamorous cruise ships that have begun sailing out of the harbor.
While the ports saw their sharpest declines in cargo shipments with volumes dipping as much as 40 percent early this year, at the same time, three of the largest cruise lines have decided to dock more or bigger ships in the harbor, bringing millions of passengers and their dollars with them.
In February, Royal Caribbean International brought its largest ship on the West Coast to the L.A. port. Called the Mariner of the Seas, it is a 3,800-passenger ship with an ice-skating rink and full-size basketball court. It will sail year-round from the port with a seven-night Mexican Riviera itinerary with Mexican ports of call at Cabo San Lucas, Puerto Vallarta and Mazatlan when the swine flu scare subsides.
Then in March, Carnival Cruise Lines launched the largest ship in its fleet, the 3,006-passenger Carnival Splendor, out of Long Beach, where Carnival is the only cruise line tenant. A few weeks later, Disney Cruise Line announced it will set up shop in the Port of Los Angeles in 2011, when it will move the base of the Disney Wonder from Port Canaveral in Florida, with an option to stay here for up to five years.
"Los Angeles really is a ripe spot for a cruise market as it's so close to millions of people living in the area or traveling through," said Carolyn Spencer Brown, editor of industry Web site CruiseCritic.com in Pennington, N.J. "It was always viewed as a secondary market and has been underdeveloped. But with these companies coming in, it's a vote of confidence for developing it into a primary spot for cruise travel."
Indeed, the cruise ship market in Los Angeles County has gradually grown and is a strong source of revenue for the local economy.
The Port of Los Angeles handled about 1.2 million passengers in 2008, about double the 618,000 passengers in 1990. Los Angeles is the largest cruise ship market on the West Coast and is the fourth largest in the United States; the top three are in Florida.
The passenger count may decline this year as a result of the economy and the swine flu scare, but industry analysts generally believe Los Angeles and Long Beach will get more passengers than most of their competitors when the economy rebounds and the cruise industry returns to normal.
Cruise operations at the L.A. port generate $87.5 million a year in regional wages with more than 2,500 jobs, and $11.2 million in state and local taxes, port officials said.
As for Long Beach, the city had no designated cruise ship terminal until 2003, when Carnival moved its operations from the Port of Los Angeles and constructed a $35 million, 40,000-square-foot terminal on the Queen Mary property across Queensway Bay from downtown Long Beach.
In 2008, Carnival processed about 500,000 passengers from its Long Beach terminal.
The operations support 525 jobs with an annual payroll of $18.2 million, according to a study by California State University, Long Beach.
The arrival of Carnival Splendor led to the company to spend an additional $8 million in upgrades to Long Beach's terminal to accommodate the mammoth ship, said company spokeswoman Jennifer De La Cruz.
Officials would not estimate the passenger count for this year, but they do expect it to increase because of the Splendor.
"Carnival's investment has given us reassurance that they are dedicated to staying in Long Beach," said Bob Maguglin, director of public relations for the Long Beach Convention and Visitors Bureau. "I don't think they'd go elsewhere after the millions they've spent with the terminal."
Long Beach serves two Carnival ships: the Splendor and the smaller Carnival Paradise, which operates three-day cruises to Ensenada, Mexico, and four-day cruises to Catalina and Ensenada.
While Long Beach only has capacity for one line, the Port of Los Angeles can handle up to four ships at a time. The port has home port agreements with Royal Caribbean International, Princess Cruises and Norwegian Cruise Line, with regular calls by Carnival Cruise Lines, Celebrity Cruises, Crystal Cruises, Cunard Line, Disney Cruise Line, Holland America Line, Seabourn Cruise Line and Silver Sea Cruises.
Disney Cruise Line's decision to come to Los Angeles with the Disney Wonder, a 2,400-passenger ship, shows the market's promise. The line first tested the West Coast market with two summer seasons in 2005 and 2008 with trips to the Mexican Riviera from Los Angeles.
"Our guests raved about the experience and have been asking us to return to the West Coast ever since," said Rena Langley, Disney Cruise Line's spokeswoman. "We are returning to the West Coast because we know that having a ship based in this region appeals to families, and an extra plus for the Port of Los Angeles is that it is close to Disneyland."
Dan Ilves, vice president of sales and marketing for L.A.-based travel management company TravelStore, said that the cruise ship market in Los Angeles has become more of an attractive option for travelers, both locals and tourists, looking to save money with all-inclusive packages and avoiding the hassles of driving or flying in the gridlocked metropolis.
"Everything you could want is on some of these cruise ships now sailing out of Los Angeles compared to the smaller ones in the past," Ilves said, "from spas to huge buffets to entertainment shows."
Yet it's not all sun and fun in maintaining Los Angeles as a main hub for cruise lines with serious challenges from the facilities at Los Angeles in need of upgrades to a brewing rivalry with the Port of San Diego.
Another factor limiting the growth of both local ports, highlighted by recent cancellations due to swine flu concerns in Mexico, is that routes from Los Angeles-Long Beach are limited mainly to Mexico and Hawaii. Competition on the East and Gulf coasts travels among many Caribbean islands along with trips to Mexico.
As the boom in cruise business is new to Los Angeles and Long Beach, the facilities still look like they were built for shipping, not tourism.
At the Port of Los Angeles, the World Cruise Center Terminal is in plain sight of stacked cargo containers and cranes, has only one concession shop for snacks, no souvenir shops and it needs new carpet.
"The terminal's beauty is in the eye of the beholder," said Chris Chase, marketing director of the L.A. port. "If you are looking at outside beauty, maybe it isn't so stunning, but it started as a warehouse and is highly functional and reliable."
The surrounding area doesn't help much either. Unlike the neighboring Long Beach terminal, which has the Pike shopping district nearby and the Queen Mary just steps away, the Los Angeles port has no restaurants, museums or souvenir stores nearby.
Officials concede the L.A. port is not as glamorous as its counterparts on the East Coast, but contend they are actively preparing for more cruise ship business.
"We see the cruise ship business as an opportunity for diversifying our port beyond it being known solely as a cargo container terminal," Chase said. "It's important to us in remaining viable as a port."
The port has added some eye-catching elements over the past decade, such as a streetcar line using restored and replica versions of the red Pacific Electric cars that used to run in Los Angeles. The red cars shuttle passengers from the cruise ship terminal to the Cabrillo Marina near restaurants and an aquarium.
In summer 2008, the port unveiled an illuminated water fountain outside the cruise ship terminal. It features 58 choreographed jets that spray to pop and classical music accompaniment. The fountain was created by WET Design, a Sun Valley-based company famous for its design of the fountains in front of the Bellagio in Las Vegas.
While Long Beach may be L.A.'s rival for the top spot in handling cargo shipments, San Diego is its main competition for cruise business, Chase said.
San Diego had 250 ship calls and processed 900,000 passengers in 2008, said John Gilmore, spokesman for the Port of San Diego.
Earlier this year, the city approved construction of a $28 million cruise ship terminal slated to replace a large tent that has handled the increasing cruise ship volume.
Port of Los Angeles officials have proposed a series of aesthetic upgrades to the World Cruise Terminal area, plus the construction of a second cruise terminal facility at Kaiser Point, formerly a supertanker facility, in the outer harbor. The plans are part of the port's San Pedro Waterfront Project set for consideration by the city's Board of Harbor Commissioner this summer, with no date of completion finalized.
"San Diego offers a lot of the same things that attract cruise lines to Los Angeles, such as the warm climate, proximity to Mexican beaches, and many tourist destinations inland," said Brown of CruiseCritic.com. "Los Angeles has to invest in its infrastructure to maintain and grow that business, but their ship seems to be headed in the right direction toward a very promising horizon."
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