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Will Cruise Tragedy Force Price Cuts?

The Costa Concordia shipwreck  last week occurred at a bad time for the cruise industry, analysts say, and may force lines to add to their already substantial deals and discounts.

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Cruise-lovers know January as “wave season” – the time of year when the lines book the bulk of their itineraries, and offer their most generous discounts. Early last week, for example, Expedia reported that some discounts were as high as 75%. If even a few travelers shy away from cruising in general or switch itineraries as a result of the Costa shipwreck, the cruise lines’ earnings could be at risk, says Jaime Katz, an industry analyst for Morningstar. “In the immediate term, cruise lines are going to have to figure out just how weak this will make demand,” she says. “They may have to toggle pricing.”

Mediterranean cruises are likely to see the biggest bump in deals, in part due to the Costa tragedy but more broadly because of the problems with Europe’s economy, says Mark Murphy, editor for advice site TravelTribe.com http://www.traveltribe.com/. “When the price gets low enough, people’s fear of events like this are allayed,” he says.

But even a cheap cruise — the region already has some six-night deals for as little as $400 — may not be enough to offset sky-high airfares, which can make it as expensive to cruise in Europe as in previous years. Also, cruise lines might try to offset discounted fares by adding more onboard charges for excursions, dining supplements and other experiences, he says.

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