Ferrying cruise-ship passengers ashore for their mandatory stop-and-shop visits on Canadian soil might seem like a creative way to gain a foothold in Vancouver Island’s lucrative cruise-ship tourism industry. But for Nanaimo Port Authority president Bernie Dumas, it’s always been a business model with decidedly limited growth potential.
“Some people might enjoy the excitement of going on these shuttles. But with the age group on these ships and all the handicapped requirements and emergency requirements, the cruise operators really prefer to have a permanent dock,” Dumas says.
After five years of relying on ferries to shuttle passengers from cruise ships anchored in the harbour to the shops and restaurants of downtown Nanaimo, the Nanaimo Port Authority is ready to take its role as a port of call to the next level. Armed with $17 million in federal and provincial infrastructure grants, the authority is embarking on a $22-million expansion of its facilities, the centrepiece of which is a floating cruise-ship dock capable of accommodating vessels up to 1,000 feet long.
“We’re going to start this summer and be ready for the 2011 season,” Dumas says. “By next year, we’ll be able to handle these major cruise ships at a terminal.”
While Nanaimo’s 10 cruise-ship visits last year were a drop in the bucket compared to Vancouver’s 256, Vancouver Island and points north on the B.C. coast continue to secure a foothold in this lucrative slice of the tourism industry. The secondary B.C. cruise market is expected to hold its own against recessionary tides this season, while Vancouver, on the other hand, is projected to lose one-third of last year’s business, dropping from 256 ship visits and 900,000 passengers in 2009 to 179 ships and 600,000 tourists this summer.
One need look no further than Victoria for an explanation. The Greater Victoria Harbour Authority’s Ogden Point terminal, which expanded to three slips a few years ago, will play host to 228 of the giant vessels in 2010, equal to the record set in 2009, when cruise-ship tourism injected an estimated $71.5 million into the local economy.
Victoria Harbour Authority CEO Paul Servos said the “encouraging” numbers stem from the cruise industry’s move to start more tours out of Seattle this season, as fewer U.S. travellers wanted to shell out extra airfare for trips originating from Vancouver. “The Alaska market has definitely been down overall, but that impact has mostly been felt in Vancouver,” Servos says. “Seattle has done fairly well, so we’ve benefited from that.”
Globally, the cruise-ship business took a sharp downturn during last year’s economic slump, but smaller ports of call on B.C.’s west coast were largely shielded from the fallout by the provisions of the Jones Act, an obscure piece of American legislation that prohibits foreign-flagged ships from calling on two U.S. ports in sequence. As a result, all Alaskan-bound vessels originating in Seattle or San Francisco, must stop in a Canadian port before returning to U.S. waters.
For smaller cities such as Nanaimo (population 85,000), 10 cruise ships are a big deal. Last year those 10 ships brought more than 20,000 visitors to the city, who spent an estimated $70 to $100 each, generating between $1.5 million and $2 million in economic activity, according to Dumas. While he hopes to increase the annual traffic to 20 or 30 ships over the next five years, Dumas has no pretensions of giving Vancouver a run for its money. “We’re not looking at anywhere near the volume of business that those guys do,” he says. “They’re in a different league.”
Prince Rupert, which is also vying for a bigger slice of the cruise-ship pie, expects to hold its own this year, attracting 25 cruise-ship calls, about the same as last year.
However, Campbell River’s Wei Wai Kum First Nation, which spent $14 million on a floating dock that opened in 2007, will not be hosting any cruise ships this summer. “We’re down for the same reason Vancouver is down,” said Darryl Anderson, a business consultant for the band’s cruise-ship program. “Not as many cruise consumers can afford the cost right now.”
Since it opened three years ago, the band’s cruise-ship terminal has hosted 10 ships, from pocket cruisers carrying between 200 and 300 passengers to full-sized luxury liners.
