Exclusive: Melbourne moves to try and win back cruise with ‘strategic plan’

• Melbourne has seen a sharp drop in cruise ship traffic over recents years.
• This drop was spurred on by an increase in port fees.
• However, the port and Victorian government are now trying to change things…i

The last few years have seen Station Pier in Melbourne transform from a thriving cruise hub to a port that rarely sees large ships homeporting and trails ports like Brisbane in ship activity. 

The perceived wisdom is that Melbourne’s port fees are simply too expensive. But this isn’t the whole story.

Melbourne’s port fees are definitely steep, clocking in at $32.78 per passenger. However, Sydney, which continues as a thriving port, charges $46.60 per passenger. This means that for a ship with 3000 passengers, it costs $40,000 extra to port a ship in Sydney than Melbourne. Yet Sydney has largely avoided the problems that Melbourne is facing.

The truth is that, in the right circumstances, cruise lines can deal with steep port fees, they can be absorbed into the cruise price and many cruisers won’t even notice. However, what cruise lines absolutely can’t stand is regulatory uncertainty.

When Melbourne raised its port fees, it wasn’t just about the rise in price, but just as much about the fact that the fees came into almost immediate effect and the cruise lines weren’t warned ahead of time. Cruise lines book ports up to three or even four years in advance, and budget their costs and price their cruises according to the current conditions, meaning that sudden changes in costs can mean big losses for the lines.

Cruise Passenger questioned Ports Victoria, asking if the port would consider freezing port fees to offer more certainty to lines. Craig Walker, CEO of Ports Victoria said: “ In line with standard business practice, it will continue to review operational costs and adjust related fees accordingly.”

However, Walker did offer some hope for the hundreds of cruise passengers who write to us weekly begging cruise lines to homeport in Victoria.

Steps are being made to facilitate more cruise. “Ports Victoria is partnering with Victorian Government in developing a strategic plan to ensure Victoria’s cruise shipping industry thrives.

“This year, we invested in upgrading facilities at Station Pier, and we have a program of innovation and infrastructure upgrades planned to support the cruise industry. We work with our cruise industry partners on an ongoing basis to identify new opportunities and ways of working to ensure cruising thrives in Victoria.”

It’s going to be an uphill battle without change.

A keen Princess cruiser from Melbourne emailed Princess Cruises to question them on returning cruise ships to Melbourne, and an email showed to Cruise Passenger showed a Princess representative saying: “I must mention that the high taxes and fees associated with departures from Melbourne have led us to temporarily pull out of basing a ship in that port.”

It appears that the only way for Melbourne to win back over the cruise industry would be direct industry communication that offers regulatory certainty over a set period. The real issue isn’t in the costs, but that the industry has lost trust in Melbourne and has worries over scheduling more cruises just to see port fees jump again, or other regulatory changes. 

This is certainly indicative of Australia’s current issues with cruise at large, that while demand certainly exists, there’s clearly a communication gap between the government and cruise lines that needs to be bridged in order for us to see more ships on our shores.

However, the news that the Victorian Government is working with the ports on a new strategic plan means, at least, that the government now understands what it has lost.

See more here.