Royal Caribbean is betting big on expanding in Galveston

Florida might soon have a rival when it comes to cruise getaways. Although the Sunshine State is home to the largest cruise market in the world, Royal Caribbean claims the Texas market has the potential to be even bigger — a concept that has prompted the line to invest heavily in the Gulf Coast region.

During Royal Caribbean Group‘s third-quarter earnings call on Oct. 29, brand executives shared that because Texas’ cruise penetration is currently only half of Florida’s, there’s a lot of room to draw both new cruisers and those who are bored with Galveston‘s currently limited itinerary options.

“Texas is a similar-sized marketplace that has half the penetration [of Florida] with a very similar propensity to cruise,” said Jason Liberty, president and CEO of Royal Caribbean Group.

Royal Caribbean International, one of three major cruise lines operated by Royal Caribbean Group, began positioning some of its largest ships out of Galveston, Texas, for the first time in 2022 with Allure of the Seas and, more recently, Harmony of the Seas. Several other lines — including Carnival Cruise Line, Princess Cruises, Norwegian Cruise Line and MSC Cruises — have also based newer, larger ships in Galveston, following Royal Caribbean’s lead.

But what sets Royal Caribbean apart is that it has also invested significant resources into developing the region instead of just homeporting vessels there.

It has done this by building a brand-new cruise terminal, which can accommodate the line’s Oasis and Icon Class vessels — the largest cruise ships in the world. But, more importantly, it’s working to create additional places for its ships to visit, which will offer more port variety to potential cruisers.

As TPG previously reported, Royal Caribbean is constructing two new private destinations in Mexico — the Royal Beach Club Cozumel, set to open in 2026, and Perfect Day Mexico, slated for 2027. These will add two new choices to the line’s Caribbean voyages out of Galveston. (Royal Caribbean is scheduled to have four ships — Harmony of the Seas, Jewel of the Seas, Mariner of the Seas and Allure of the Seas — sailing four to 11-night cruises from Galveston at various times throughout the next two years.)

“Having assets like the Royal Beach Club at Cozumel … will allow us to drive more and more — not only to that market but also more of the Gulf Coast and other markets that can have an easier fly-cruise experience and have a lower-cost fly-cruise experience,” Liberty said.

Michael Bayley, president and CEO of Royal Caribbean International, echoed that sentiment, saying Royal Caribbean hopes to draw potential passengers from nearby Louisiana, as well as the robust and, at times, oversaturated Florida market.

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What’s the line’s more specific target? Young families who hail from those areas and who are seeking short sailings. Royal Caribbean recently saw success in placing newer, larger hardware on short-itinerary duty. It has dedicated its newest Oasis Class vessel, Utopia of the Seas, to three and four-night voyages from Port Canaveral near Orlando.

“There’s quite a few really positive things that come with Perfect Day Mexico and the Royal Beach Club Cozumel,” Bayley said during the call. “One is that we can really introduce a much larger volume of short product market out of Texas, Louisiana, North Florida … It really is a great opportunity for us, and we know that that short product really catches with younger families. We’ll be able to offer really an extraordinary short break from these ports … so we think that’s really a huge competitive advantage.”

The Royal Beach Club Cozumel and Perfect Day Mexico will join the line’s already successful private destinations: Labadee in Haiti and private island Perfect Day at CocoCay in the Bahamas. Cruisers consistently rate the latter as the line’s top destination. Royal Caribbean will also add another new beach area — the Royal Beach Club Paradise Island — in the Bahamas in 2025.

Although passengers can enjoy the line’s Perfect Day and Labadee locations for free, both beach clubs will require an entry fee for access.

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