Carnival axes half its fleet in Australia as cruise exodus continues

• Carnival Cruise Line has announced it will halve its fleet servicing Australia as it looks to recoup costs.
• In March 2028, the Carnival Luminosa and Carnival Adventure will depart, leaving just two ships in local waterways.
• The exit comes amid other cruise lines sending their fleet overseas due to high operating costs and regulatory conditions in Australia.

Australia’s biggest cruise line will halve its fleet servicing local passengers, citing high operating costs and tough regulatory conditions.

Carnival Cruise Line announced it would cut its fleet from four ships to two, with Carnival Luminosa and Carnival Adventure departing in March 2028.

Carnival said the decision followed consideration of a “range of factors,” including “long-term certainty and globally competitive operating conditions.”

Cruise lines, including Carnival, have expressed dismay at the Federal Government’s decision to extend an exemption from the Coastal Trading Act for foreign-flagged cruise ships.

The exemption means cruise lines don’t have to pay additional license fees when sailing between ports, but operators such as Carnival argue two years isn’t enough stability.

“The extension is a welcome but interim step while the long-term operating framework for the Australian cruise sector is developed over the next two years,” Carnival Cruise Line Country Manager Peter Little said.

“As the only cruise line with ships dedicated year-round to Australia, Carnival has greater exposure to changes in local market and operating conditions than cruise lines with a seasonal or more limited presence.

“We will continue to work constructively with the Federal Government as it develops the future arrangements for cruise ships operating in the Australian market.”

The Carnival Luminosa, which has sailed seasonally from Brisbane since the industry restarted in 2022, will make its final voyage from Sydney on 15 March 2028.

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The Carnival Adventure will depart Sydney five days later on March 20, 2028, and will not return to Australia as originally planned.

Carnival’s remaining two ships, the Splendor and the Encounter, will continue to sail year-round from Sydney and Brisbane, respectively.

Carnival the latest in cruise exodus

Carnival is the latest cruise operator to pull out of Australia, citing regulatory conditions and high operating costs.

In February 2024, Virgin Voyages announced it was cancelling its planned Australian summer season, and in March 2025, Carnival Cruise Line absorbed P&O Australia, losing one ship, Pacific Explorer.

That same year, Cunard ended its homeport arrangement with the Queen Elizabeth, announcing it would visit Australia only as part of international trips.

In February this year, Disney announced it was pulling out of Australia altogether.

The exodus is not because Australians have fallen out of love with cruising. A record-breaking 1.45 million Australians went on a cruise in 2025, according to data from the Cruise Lines International Association (CLIA).

Instead, Australia presents a tough case for maritime businesses.

Due to a relatively low population base and ports that are spread very far apart, rising fuel costs mean profit margins are smaller than in locations where ports are grouped close together, like the Mediterranean.

There’s also the pickle of Australia’s Coastal Trading (Revitalising Australian Shipping) Act 2012. The act requires foreign-flagged ships (such as cruise lines) to hold specific licenses if they are ferrying passengers between ports.

When cruising restarted after COVID-19, operators successfully lobbied the government to provide an exemption from the license fees.

The government recently extended that exemption through December 31, 2028, but has flagged that it will not extend it again.

Cruise lines say their business forecasts are made years in advance, and they have rejected the short-term stability of a two-year exemption.