Cuba Travel Ban Could Ignite Secondhand Ship Market

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The secondhand cruise ship market could pick up steam following recent Cuba restrictions.

With nautical and infrastructure restrictions in Havana, cruise lines calling on the Cuban city have been using older, medium-sized vessels that may not have fit into their traditional fleets.

Industry sources said they expect some pick-up in the secondhand market with Cuba now off limits, as the now less-competitive tonnage could find new owners, or become ships in new ventures.

Among the players, Carnival Corporation sold multiple ships in 2018 but has not announced any transfers or sales thus far in 2019.

Last year, it was announced that the Pacific Eden was sold to Cruise & Maritime Voyages while the Pacific Jewel was sent to Indian start-up Jalesh Cruises.

Holland America Line sold the Prinsendam, which will become the Amera this summer for Phoenix Reisen.

P&O Cruises UK also announced the Oriana will leave the fleet in 2019, joining the Piano Land startup in China.

Royal Caribbean Cruises has not announced any significant fleet changes in some time, nor has Norwegian Cruise Line Holdings.

In December, on an earnings call, Carnival Corp. President and CEO Arnold Donald said that if a ship is earning and relevant, that is most key.

Carnival, Holland America will sail to Cuba as planned

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Carnival Fathom in Havana

Carnival Corp. said it understands the policy changes on Cuba that President Trump will announce in Miami today do not include any changes for cruises.

In a statement, Carnival said it is “pleased” that its ships will continue to sail to Cuba.

Carnival Cruise Line plans sailings from Tampa to Cuba starting later this month and Holland America Line recently announced plans to visit Cuba in the fall.

Trump is expected to end the ability of travelers to “self-certify” that they comply with rules for traveling to Cuba, which became the practice last year under President Obama.

“We will review the extent of the tightening of the travel rules, but our guests have already been traveling under the 12 approved forms of travel to Cuba since we undertook our historic first cruise to Cuba more than a year ago,” a Carnival Corp. statement said.

The first cruise to Cuba from a U.S. port in decades was by Carnival’s Fathom brand, which has since returned its single ship to P&O Cruises.

“Our experience in Cuba this past year has been extremely positive,” Carnival Corp. said. It also said other Carnival Corp. brands have applied to travel to Cuba.

Costa included Cuba on some itineraries from 1995 to 1998, before it was purchased by Carnival Corp. from its Italian owners.

Other cruise lines chimed in after Trump finished giving his speech in Miami.

“Based on the information shared today, we are very pleased to learn the news that cruises to Cuba will continue under the new guidelines laid out by the administration,” a statement from Norwegian Cruise Line Holdings said.

NCLH operates Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises, all of which sail to Cuba.

Royal Caribbean Cruises Ltd. also praised the new Cuba policy.

“Royal Caribbean is pleased there is no impact to any of our cruises to Cuba as announced in the new U.S. policy toward Cuba today,” said a statement from RCCL, whose Royal Caribbean International and Azamara Club Cruises brands make stops in Cuba.

Although cruise lines appear to have emerged unscathed from the Cuba policy review, the exact impact will depend on rule revisions forthcoming from the Treasury Department and other U.S. agencies.

“We will continue to review the full and exact scope of the policy changes and any updated regulations during the implementation period which may take several months,” RCCL said.

Both cruise companies emphasized that their shore excursion programs were already in compliance with Treasury regulations governing Cuba tourism.

Both also said that their cruises with Cuba in the itinerary are popular. NCLH said it has 70,000 bookings for future cruises that include Cuba. “We are delighted our guests will continue to have the opportunity to experience the wonderful culture and incredible history of Cuba.” the statement said.

Carnival CEO says Trump likely to be pro-business

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Carnival Corp. CEO Arnold Donald with Travel Weekly editor in chief Arnie Weissmann at CruiseWorld. Photo Credit: Jamie Biesiada
 

Carnival Corp. CEO Arnold Donald said that the election of Donald Trump as president has the potential to be good for the cruise industry, but he also said he hopes that Trump will do “the right thing” internationally.

Donald made the comment during a conversation with Travel Weekly editor in chief Arnie Weissmann at CruiseWorld, an annual Travel Weekly event in Fort Lauderdale that brings together travel agents and travel suppliers.

Asked by Weissmann for his response to the election, Donald quoted Secretary of State John Kerry, who several years ago said that there are no winners or losers after a U.S. presidential election. “The next morning we all wake up as Americans” who work on problems together, Donald said.

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More specifically, Donald said, “On the surface, President Trump will be pro-business. At the same time, I hope he does the right thing internationally. Most of our business is outside the U.S.”

In a follow-up about Cuba, Donald said that despite Trump’s campaign rhetoric about reversing President Obama’s openings toward Cuba, “I’m cautiously optimistic that bringing the two countries together is the right thing to do.”

Earlier this year, Carnival Corp.’s Fathom brand became the first line to regularly shuttle passengers between the U.S. and Cuba in over 50 years.

Donald said Carnival continues to work on a private destination in the Bahamas but isn’t ready to announce anything. Carnival executives have said in the past they have a potential site picked out on Grand Bahama Island.

“We want the right one on the right terms,” Donald said. “We think we have something coming soon, but we don’t want to count the chickens before they hatch, so to speak.”

Donald took the chance to show the audience of several hundred travel agents clips from the new Carnival-produced Saturday-morning network TV shows, such as “Vacation Creation” and “Ocean Treks with Jeff Corwin.”

He also regaled the group with a tale of highlights from his rise to CEO of Carnival Corp. He said his initial introduction to Carnival Corp. chairman Mickey Arison was engineered by board member Uzi Zucker, a Bear Stearns partner who also served as an adviser to a private equity firm of which Donald was a part.

He also told about his ambition as an 11th-grader to be a very specific level of manager at a specific type of Fortune 50 company. He said the teachers at the all-boys Catholic high school in New Orleans he attended on scholarship constantly reminded their students to think big.

“Three times a day they told us, ‘Gentlemen, prepare yourselves. You’re going to run the world.'”