Today’s cruise ships are big business and have become more so in recent years as people worldwide continue to take advantage of these floating hotels’ incredible amenities. However, building one is no easy task; making even the smallest cruise vessel costs millions.
The cost of building a cruise ship varies widely depending on the Ship’s size, design, and amenities, as well as the location and competition in the shipbuilding industry. Generally, a mid-sized cruise ship can cost anywhere from $400 million to $1.5 billion or more to construct.
Cost of Modern Cruise Ships
Of course, many factors determine how much it will cost to buy or charter a modern cruise ship, but here we’ll look at some key statistics associated with the construction process.
As you can see below, the cost of building a cruise ship has increased dramatically over time. This makes sense, given just how large these vessels get and that each new cruise line adds additional features, which typically means an increase in size.
As mentioned above, the cost of constructing a cruise ship varies depending on the type of vessel built (such as a luxury liner or expeditionary yacht) and its size. In general, though, the larger the cruise ship, the more it will cost to build.
According to data from the International Maritime Organization (IMO), the average cost for a modern cruise ship ranges between $300 million and $500 million. Here are some examples of the cost breakdown for various types of cruise ships:
- Single Ship – $150 million
- Double Ship – $250 million
- Triple Ship – $350 million
- Quadruple Ship – $400 million
- Five Star – $500 million
This gives us an idea of what kind of money cruise companies spend when purchasing or chartering a brand-new cruise ship. But let’s move beyond this basic information and find out exactly what goes into creating a modern cruise ship.
What Makes Up The Price Of A Cruise Ship?
Now that we’ve established that the cost of buying or chartering a cruise ship depends mainly on its size and type, let’s take a closer look at the components that make up the overall cost of creating a cruise ship.
These include steel, concrete, electronics, paint, furniture, and other items needed to complete the project. Below you’ll find a breakdown of all these major categories and how much they add per cruise ship.
- Steel – $100-$200 Million
- Concrete – $50-$80 Million
- Electronics – $5-$10 Million
- Paint – $20-$40 Million
- Furniture – $25-$35 Million
- Other Items – $15-$30 Million
These numbers give us a good idea of the total money spent on every cruise ship constructed. While it may seem high, remember that each new cruise line adds additional amenities such as restaurants, entertainment venues, swimming pools, spas, and fitness centers.
All these upgrades mean bigger rooms, more bathrooms, etc., adding hundreds if not thousands of extra square feet to the final product.
How Do You Get Paid For Building A Cruise Ship?
Once you know roughly how much it costs to build a cruise ship, you might wonder how cruise lines pay for these projects. Well, the answer is quite simple. They sell shares in the company to investors, who then provide them funding to help cover the expenses related to building the vessel.
Once the Ship is completed, the company sells those shares back to the original investors and any profits made during the voyage.
While this method of financing certainly isn’t cheap, it does offer several benefits, including tax advantages and the ability to use the funds raised towards future projects.
Plus, since the share prices tend to rise after a new cruise ship’s completion, investors usually make a profit regardless of whether or not the company is profitable.
How Long Does It Take To Build A Cruise Ship?
Before diving deeper into how long it takes to build a cruise ship, it’s essential to understand that while every cruise line uses slightly different methods, the construction process tends to fall within three distinct phases.
Each phase lasts anywhere from 12 to 24 months and includes everything from design work to materials acquisition to the actual assembly of the Ship.
Phase 1 – Design & Engineering
During this first phase, the cruise line hires contractors to begin working on the detailed plans for the vessel. This involves hiring engineers to develop the blueprint specifications and architects to oversee the design process. After the initial designs have been finalized, engineering teams start looking at ways to optimize the space inside the Ship so that passengers have plenty of room to enjoy themselves without bumping into each other. At the same time, electrical, mechanical, and plumbing experts develop the systems required to keep the Ship running smoothly.
Phase 2 – Construction & Fitting Out
When the preliminary designs are finished, the second phase begins, where builders put together the actual physical structure of the Ship using steel, concrete, and other materials. During this stage, workers install the windows, doors, fixtures, and fittings throughout the interior as well as the exterior of the Ship. They also finish the exterior shell by applying the paint to the outside of the hull before the entire thing is finally turned over to the shipyard for further modifications.
Phase 3 – Final Assembly
Once the exterior of the Ship is complete, the third phase begins, where the interior finishes are added. This includes things like carpeting, wallpaper, furniture, artwork, etc. Then comes the fun part! Workers fit out the cabins, restaurants, bars, lounges, casinos, shops, and other areas of the Ship with everything you’d expect to find on a typical cruise ship. Finally, once all of the finishing touches have been applied, the new cruise ship is ready to set sail and take passengers on unforgettable vacations.
What Are The Differences Between A Cruise Ship And An Aircraft Carrier?
There are two main differences between a cruise ship and an aircraft carrier. First, unlike an aircraft carrier, cruise ships don’t require a crew of thousands because they only carry a few hundred passengers at a time. Second, cruise ships aren’t designed to stay at sea for extended periods, whereas aircraft carriers can remain at sea indefinitely thanks to their advanced propulsion system.
Are There Any Other Costs Associated With Building A Cruise Ship?
In addition to the apparent costs outlined above, a few other miscellaneous fees need to be considered when calculating the cost of building a cruise ship. These include insurance premiums, maintenance costs, fuel charges, port taxes, and other similar charges.
We won’t go into much detail about these since they’re pretty straightforward, but note that these fees vary greatly depending on the type of cruise ship being built.
Why Is The Cost Of Building A Cruise Ship So High?
So why is it so difficult and costly to build a cruise ship? Well, there are a couple of reasons for this. First, the sheer size of modern cruise ships makes them incredibly difficult to transport. Even if the Ship were disassembled entirely, it would still take dozens of trucks to haul it to its next destination.
This is something that cruise lines want to avoid at all costs, so instead, they opt to build massive floating factories right offshore.
Second, the labor involved in building a cruise ship is highly complex. Unlike traditional construction projects, cruise ships must meet stringent safety standards and regulations that govern everything from the ship’s layout to the materials used to build it.
Since cruise lines operate across multiple countries and territories, complying with local laws often requires extensive research and development efforts.
Finally, another reason building a cruise ship is so expensive is that the industry is highly competitive. Not only do cruise lines compete against each other for customers, but they also face fierce competition from airlines and other forms of mass transportation.
To remain relevant, cruise lines must continually improve their services and introduce innovations to attract customers. Unfortunately, doing so always comes at a cost.