Disney ship is to be relocated to L.A. TRAVEL: Family-themed cruise line will bring jobs, tax revenue to city.
Disney Cruise Lines announced Monday it will relocate a family cruise ship to the Port of Los Angeles beginning in 2011, a move that city officials said will boost the region's flagging hospitality industry.
Disney officials were joined by "Captain" Mickey Mouse and city leaders for the announcement of the agreement, which is expected to generate 2,600 new jobs and $7 million annually in tax revenue for the region.
"The path to (economic) recovery sets sail in Los Angeles," said Mayor Antonio Villaraigosa at a news conference at the landmark El Capitan Theatre. "(The year) 2011 can't come soon enough."
Expected to be ratified Thursday by the city Harbor Commission, the two-year contract includes an option for a three-year extension.
Company officials did not announce the itinerary for the 83,000-ton Disney Wonder liner.
They estimate that as many as 50,000 passengers will travel aboard the family-themed ship each year, visiting Disneyland and seeing other sights in Southern California.
"Any kind of tourist activity creates many jobs to support," said Geraldine Knatz, executive director of Port of Los Angeles.
She estimated that half the new jobs will be filled by residents of San Pedro, Wilmington and other harbor-area cities.
Now based in Florida, the relocation of the Wonder is part of the doubling of Walt Disney Co.'s cruise line business, from two to four ships by 2012.
Under construction now, Disney Dream and Disney Fantasy will be anchored at Port Canaveral, Fla.
Those will join Disney Magic, the cruise ship that tested the West Coast waters for business in the summer of 2005 and 2008 with seven-day trips to Mexico.
The success of those trips led to the company's decision to relocate Disney Wonder to Los Angeles.
But travel, even during treasured holidays, is not immune to today's free-falling economy. Last Christmas marked the first drop in family travel during the holiday since 2002.
To keep rooms filled, cruise ships have discounted rates, and cash-strapped consumers are filling them on bargain getaways.
Cruise prices have dropped 50 percent to South America and up to 30 percent to Alaska, according to Mike Driscoll, editor of the Chicago-based industry journal Cruise Week.
Cruise trip costs have dipped 15 percent to Europe, 10 percent to the Caribbean and about 6 percent to Mexico, Driscoll said.
"The decision was to lower the rates versus keeping the rates steady and going at 70 percent occupancy," Driscoll said. "It's a big decision."
Driscoll said Disney's cruise from the Port of Los Angeles will draw local residents seeking affordable escapes without the sting of high airfare costs they would otherwise pay to fly to Florida and other states with cruise connections.
Jay Rasulo, Walt Disney Parks and Resorts chairman, said the Disney lines are thriving because they are niche lines that provide family-oriented vacations.
"We're in a bit of a unique segment of the cruise industry and are 100 percent family-focused," Rasulo said. "It has fared us well."
Santa Clarita-based Princess Cruises already sails out of the Los Angeles port, but a spokeswoman said the companies serve different markets.
Though Princess Cruises offers family-focused trips and has youth centers on their ships, they tend to draw older passengers because they offer longer vacations than other lines. The average trip length is 10 days on Princess Cruises.
"We don't market that extensively to the first-time cruiser," Julie Benson said. "The cruisers coming to Princess tend to be experienced, so the product is well-suited for them."