After a six-month suspension, how are Yangtze River cruises faring?

The Unforgettable 2020 

The global inland river cruise industry has four major markets: the Rhine and Danube in Europe, the Nile in Egypt, the Mississippi in the United States, and the Yangtze in China.

Stretching 2,800 kilometers, the Yangtze River runs through regions with 14 World Heritage sites, 69 national scenic areas, 37 famous national historical and cultural cities, and 22 national 5A-level tourist attractions (the first batch). Its annual capacity for high-end tourists reaches 800,000 person‑times (652,000 in 2019).

However, in 2020:

• The total number of domestic tourists received was 240,000
  • Luxury cruises: 153,000 passenger arrivals
  • Economy cruises: 88,000 passenger arrivals

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• Domestic passenger volume was 21.7% of that in 2019.
• International tourists received: only 413 person‑times, or 0.4% of the 2019 level.

And these results were achieved only after July 23.

Chongqing Carnival Century Cruises Co., Ltd. (“Century Cruises”) is a benchmark enterprise in China’s inland river cruise industry, owning a fleet of 12 modern, high‑tech five‑star luxury Yangtze cruises. It is a full‑industry‑chain company integrating independent design, construction, operation, and marketing.

Yet even such an enterprise suffered heavy losses in 2020.

Li Qing, Deputy General Manager of Century Cruises, told Pincheng Travel:

“In the second half of 2020, our company operated 5 cruise ships. Capacity dropped by nearly 50% compared with August–December 2019, passenger volume fell by more than 50%, and ticket prices decreased by nearly 30%. Operations were extremely difficult.”

The market downturn is likely to extend into the first quarter of 2021. This period is already the off‑season for Yangtze cruises, and scattered COVID‑19 outbreaks have further increased market uncertainty.

© Century Cruises

“We expect the overall market to gradually improve starting from the second quarter, and the full-year performance will be better than in 2020. Judging from the current situation, we should be able to get all our cruise ships back into operation,” said Li Qing.

Industry insiders revealed that cruise lines that have resumed service face higher epidemic prevention costs, and pandemic restrictions have kept passenger occupancy rates low, making it extremely difficult for cruise companies to achieve profitability. Resuming operations may even result in greater losses than remaining mothballed. Yet it remains a strategic choice for cruise companies, which will actively pursue it and take corresponding measures. This is driven by the need to accumulate epidemic prevention experience and maintain investor confidence.

Despite the challenging market conditions in 2020, some industry players told Pincheng Travel, “We performed fairly well and are satisfied with our results.”

Starriver Cruises, which once operated European inland river cruises, holds the exclusive sales rights in the Chinese market for multiple inland river cruise routes including the Danube, Rhine, Volga and Nile.

The company began operating Yangtze River routes in 2020, aiming to upgrade Yangtze River cruise products and sales systems. It took the lead in launching a series of high-end Yangtze River itineraries and achieved encouraging results in 2020.

According to Yang Lulu, General Manager of Beijing Starriver Cruise International Travel Service Co., Ltd.:

“The Yangtze River route is a strategic layout for Starriver Cruises. The pandemic actually accelerated our pace.We conducted inspections as soon as Yangtze River shipping reopened in July 2020, started chartered operations in September, and achieved solid performance in 2020. We will develop more new Yangtze River products in 2021.”

In 2020, Starriver Cruises joined hands with Century Cruises to launch the brand-new Chongqing–Wanzhou “Yu Meeting the Three Gorges” route.Adopting an all-inclusive pricing system, and upgrading a series of cruise services and channel systems, the route brought a brand-new experience to passengers.

It achieved record-high passenger satisfaction ratings in the Three Gorges region, and its occupancy rate took a clear lead among all routes.

Image Source: Chongqing Cruise Center 

According to her, Starriver Cruises has drawn on its experience in operating European inland river cruises to upgrade products and services, and continued its 1+N cruise ticket sales model. This model not only provides visitors with high-quality products at a better cost-performance ratio, but also guarantees channel profits.

After one year of operation, Yang Lulu summarized several key points:

1. Adhere to the brand philosophy of “Upgrading Travel Experience” and the “1+N” channel distribution model, consistently delivering more valuable products and services to consumers and distributors.

2. Starriver Cruises will act as a good partner serving the inland river cruise ecosystem, laying a solid foundation for cruise shipping, sales, operation, product development and other sectors, improving products and services, and protecting the sound ecosystem of inland river cruising.

3. Pursue route innovation and continuously launch products to meet the needs of different customer groups. On the basis of traditional Chongqing–Yichang and Wanzhou–Maoping routes, maintain popularity and highlights by upgrading services. Meanwhile, closely follow consumer demand in new product innovation, uphold the high-standard all-inclusive product system, and meet consumers’ higher expectations for the Three Gorges.

4. Stick to one-stop packaged products. All products adopt an all-inclusive design consistent with European standards, with no optional charges and no shopping. They include long-distance transportation and ground services. Products no longer rely on simple price competition; with ground services included, itineraries are rich and flexible, such as switching from train to flight, or adding 5-star hotels in Chongqing.

It is reported that based on its chartered cruises in 2020, Starriver Cruises will launch more comprehensive and competitive Yangtze River inland cruise products this year, including Chongqing–Shanghai, Chongqing–Nanjing, Chongqing–Jiujiang, and Chongqing–Wuhan.

It is clear that “innovation” will be the main theme of Yangtze River cruises going forward.

Yangtze River Cruises: A Better 2021 

For the arrival of 2021, many cruise companies have expressed optimism.

Xie Xie, Chief Researcher of Cruise Development at the Waterborne Transport Research Institute of the Ministry of Transport, believes that the situation of Yangtze River cruises will definitely improve in 2021 due to two factors:First, the experience accumulated in 2020 has boosted consumer confidence, facilitating market recovery in 2021.Second, the gradual rollout of COVID-19 vaccines and improved epidemic prevention measures have better ensured safety in the Chinese market.

The market is expected to grow by more than 50% compared with 2020.In July 2020, shortly after the epidemic stabilized, construction began on a new generation of high-end Yangtze cruise ship (CMCS-004-1), which is expected to be completed by the end of November this year.

It is reported that the cruise ship uses full-rotor rudder-propeller electric propulsion, is equipped with comprehensive service functions, and features a variety of cabin types to meet the needs of diverse target customers.The diversification of Yangtze River cruise products will become a trend.

In addition to the new Wanzhou–Chongqing route, cruise companies have successively launched new routes including Wanzhou–Wushan–Wanzhou and Chongqing–Fuling. 

© Century Cruises

Li Qing of Century Cruises stated:“In the future, diversified route layout will remain the major trend for the development of Yangtze River cruises. In 2021, our company has planned four new routes, namely Chongqing–Wanzhou–Chongqing, Chongqing–Shanghai, Chongqing–Wuhan, and Wuhan–Shanghai, achieving a full coverage of the entire Yangtze River basin.The entry of new charter companies into the market is not only a test and challenge for us and other cruise operators on the Yangtze, but also a motivation for us to refine our products and upgrade our services. We are confident that Yangtze River cruise tourism will keep getting better.”

Xie Xie agreed, saying:“After the pandemic, inland river cruise enterprises need to develop high-end products tailored for Chinese travelers. Due to the ongoing pandemic abroad, it is almost impossible for Chinese tourists to take international cruises. Serving this group with more complete high-end offerings has become an innovative choice for some cruise companies.

The 15-day all-inclusive Shanghai–Chongqing route launched by Century Cruises is expected to gain strong market appeal.”Although the pandemic has dealt a heavy blow to the Yangtze inland river cruise industry, it has also created a crucial window of opportunity for the sector to upgrade, transform, and innovate its business models and products.Will the industry seize this window? Pincheng Travel will continue to follow the developments.