STEVE HIRSHAN
VICE PRESIDENT (as at 2003)
Sales & Marketing
MSC Italian Cruises

In 2003 Steve Hirshan shared his view from the bridge and talked about niche cruise lines such as MSC as alternatives to the mass-market products


OPPORTUNITIES FOR NICHE CRUISE LINES

The increasing homogenization of the cruise product today has created opportunities for niche cruise lines to successfully market their products. As the mass-market lines continue to build larger and larger ships, personalized service, the hallmark of the cruise industry, can become compromised.

MSC Italian Cruises, based in Naples, Italy, is a relative newcomer to the North American cruise market. We have been marketing in North America only since 1998 when our then flagship, the Melody, first sailed from Fort Lauderdale to the Caribbean. In four short years our business in this competitive market has grown by 400%, a good indication that there is opportunity for niche carriers such as MSC.

Our parent company, Mediterranean Shipping Company, is the second largest freight container company in the world, operating over 200 containerships, as well as fast ferries in Europe, with 19,000 employees worldwide. Having seen the synergies and growth potential in the cruise industry, they entered this market 12 years ago with the purchase of three existing cruise ships. Their original concept was to provide unique itineraries combined with value pricing and accented with the warm hospitality of a true Italian Cruise – a concept that has become the hallmark of MSC Italian Cruises.

The company’s initial and sustained success has led to the acquisition of two brand new cruise ships, the Lirica (1,580 passenger capacity) and the Opera (1,760 passenger capacity). The Lirica is expected to enter service in April, 2003, and the Opera to follow in the summer of 2004. North American cruise lines put more new ships into service during 2002 than in any other single year in its history, and MSC is among those companies seeing strong commercial prospects ahead.

With the backing of its parent company, MSC Italian Cruises has experienced ship operators at the helm of the company, and access to well-established ship maintenance and repair facilities worldwide – a plus for security-minded vacationers booking cruises today.

Our future plans call for the deployment of the new cruise ships in key MSC itineraries, the Mediterranean during the summer, and the Caribbean from the U.S. in the winter. While these new vessels are of moderate size when compared to most of today’s cruise market, they are exceptionally well-suited for MSC’s unique, high quality Italian service that passengers have enjoyed since the company’s inception.

With the continuing consolidation that is taking place in today’s cruise industry, it is even more critical for the cruise passenger community and the travel agency distribution network to support MSC Italian Cruises and other niche cruise lines. These smaller lines can tantalize experienced cruisers by offering something different, a good selling point for cruise marketers. Without strong supplier alternatives to the mass-market products, choices will continue to diminish, and agents earning ability will suffer as well.

MSC Italian Cruises sees a great future for the cruise industry, as evidenced by the significant investment our company is making in new tonnage. Industry sources report more than 2-million North American vacationers cruised during the third quarter of 2002, a 17 percent increase over the same period last year. This gives us a good foundation for optimism in 2003.

We are also confident that our company’s formula – varied destination choices combined with unique Italian service and exceptional value – will continue to work well for us in the years ahead.

We look forward to working with our industry partners to continue this great success story for all of us.