
Cruise tourism generated a total of $1.37 billion across New Zealand in 2023 and 2024, supporting nearly 10,000 jobs nationwide. Despite being a key pillar of our tourism sector, New Zealand’s cruise industry is facing rocky economic waters as it faces rising costs, regulatory issues, and pressure from climate activists.
These figures come from a report commissioned by the Cruise Lines International Association (CLIA) Australasia in partnership with the New Zealand Cruise Association (NZCA). The 2023-24 cruise tourism season saw 1,011 visits to 21 ports and destinations by 54 different cruise ships.
Though the report lauds the sector’s $681 million of value added to the nation’s economy, it says intensifying challenges could result in a 20% decline in visitor numbers in the coming season.
Rising operational costs, increasing port fees, and regulatory uncertainty have led to fewer scheduled cruise deployments to New Zealand, with some cruise lines choosing to deploy ships elsewhere.
The Government increased the border processing levy for cruise passengers from NZ$11.48 to NZ$21.54 starting in December 2024. CLIA Australasia managing director Joel Katz estimates losses of at least $157 million in reduced tourism over the 2024-25 season.
“New Zealand is one of the most desirable cruise destinations in the world and cruise lines have invested heavily over many years to develop international cruise operations in local waters,” Joel says.
“Cruise tourism is ordinarily worth more than $500 million a year to communities around the coast of New Zealand, but this is now threatened by a succession of exorbitant cost increases by ports and government agencies.”
NZCA CEO Jacqui Lloyd says cruise tourism supports a huge variety of local Kiwi businesses like tour operators, travel agents, hotels and restaurants, retailers, transport providers and port operators.
“New Zealand has become one of the world’s most expensive destinations for cruise operations, and this is already costing Kiwi businesses millions of dollars as ships head elsewhere.”
Pandemic Pressures
The ship sailed on the cruise industry as operations were suspended globally due to the coronavirus pandemic. Per Stats NZ, the cruise tourism spend was $547 million during the 2019-20 season, down 3.2% from the season before because of the early closure of cruise ships in March 2020.
New Zealand reopened its borders to cruise ships in July 2022. Tourist numbers had rebounded by the following October. Globally, an estimated 35.7 million people are expected to embark on cruises by the end of 2024, surpassing pre-pandemic levels.
The industry is still recovering from the pandemic. Cruise ship margins are tight, and cruises are sold at least a year in advance, so operators, not passengers, take the financial hit, not to mention increasing costs and fees.
The cruise sector was very surprised by the fee increases as they came at a time when the country needed to entice visitors back.
“We have continually passed on the message that cruise ships need that 12-month window, and it consistently falls on deaf ears,” Jacqui says.
Post-pandemic, a new era of stringent health and safety protocols for the cruise industry has begun. Cruises expose guests to new environments, crowds in semi-enclosed areas, and limited medical resources, which create a heightened risk and rapid spread of disease.
The CLIA says the average age of cruise passengers is 45, with the 60 to 69 age bracket the largest, comprising one-fifth of travellers. The older you are, the more susceptible you are to diseases such as coronavirus, a fact that played out on cruise ships worldwide.
Different countries and cruise providers have their own health and safety protocols. Keep yourself healthy by drinking water, managing your seasickness, getting vaccinated, telling the truth, and going easy on the alcohol and buffet.
Cruising Clean
Climate activists also set the cruise industry back. Protesters from Climate Liberation Aotearoa have met cruise ships coming into port all year, including the Silver Muse and Carnival Splendour ships, each with more than 1,000 passengers, that docked in Port Otago’s harbour in December.
They say carbon emissions from the Carnival Cruises line in Europe alone totalled 2.55m tonnes, which is more than the total emissions of the city of Glasgow.
Per University of Auckland senior lecturer Dr Timothy Welch, cruise liners emit more carbon dioxide than any other kind of ship. They produce at least twice the carbon emissions of a long-haul flight with each passenger mile.
“And it’s not just the oceans the ships cross or the ports where the vessels dock that are affected,” Timothy says. “A recent study found that standing on the deck of a cruise ship exposed passengers to air quality equivalent to a city like Beijing.”
Carnival Splendour then went to Fiordland. “Cruise ship passengers often come to New Zealand with the primary intention of seeing these beautiful landscapes, yet they show no care or consideration for the damage they are doing to them,” says spokesperson Jen Olsen.
“We all agree that these environments are something worth preserving, and yet we aren’t doing anything to protect them.”
Climate Liberation Aotearoa calls for cruise ships to be banned from sensitive natural environments such as Fiordland. In 2020, the Queen Mary 2 couldn’t sail near Fiordland or Dunedin – two highlights of the cruise – because of dirty hull syndrome.
Dirty hull syndrome describes the issue of biofouling, where high-risk organisms such as mussels, oysters, crabs, and starfish attach to the hull of a ship. This proves a threat to marine life and increases emissions as the ship gets heavier. Current New Zealand biofouling standards were introduced in 2018.
“Cruise lines are continuing to reduce their emissions at sea and berth in pursuit of net zero emissions by 2050,” says CLIA CEO Kelly Craighead.
The CLIA says that cruise lines are sailing to a better future – pursuing fuel flexibility by investing in propulsion technologies with future conversion capabilities.