Cunard Line has put together a new video of Micky Arison talking about how Carnival Corp. came to own the storied brand, and it’s worth seeing if you can get the opportunity. Among other things, it sheds some light on the immigration issue that is prominent in the current political debate.
The video begins with Arison reminiscing about coming to the U.S. on Cunard’s Mauritania. It was 1954. Arison’s father, Ted, who founded Carnival, moved the family from Israel to New York where he thought there would be better business opportunities. Micky, who was 5, recalls going to school in New Jersey and being driven along the West Side Highway past the trans-Atlantic liners at the pier.
Little did he imagine at the time, Arison said, that he would grow up to play an important role in the cruise industry.
Arison said he got the idea for a liner like the Queen Mary 2 after seeing the film “Titanic,” with the nostalgic, romantic gloss it put on the ill-fated ship. The 1997 film was the first film to gross more than $1 billion.
In 1998, Carnival bought 68% of Cunard for $425 million, buying the rest later.
Arison said it is often misunderstood that Carnival conceived of the Queen Mary 2 after deciding to buy Cunard. The reality is (one of Arison’s favorite phrases) that Carnival conceived of the ship first and only bought Cunard because It needed the historic brand to make the concept work.
Ted Arison came to the U.S. via Cunard when immigration was at a low ebb. It had been 30 years since the restrictive Immigration Act of 1924 had been passed “to preserve the ideal of American homogeneity,” according to a State Department history. It would be another 10 before the law was liberalized by Congress after President Kennedy’s death.
America was as homogeneous as it would ever be in 1954. Yet it still had room for Ted Arison, born in Tel Aviv when it was part of British Palestine. That’s to America’s credit.
Open immigration is a blunt instrument. Some immigrants may turn out to be criminals. Most are ordinary like the rest of us. But some, perhaps a disproportionate number, are extraordinary, like Ted Arison. Is there any doubt that the U.S. economy is better off with Carnival Corp. headquartered in Miami instead of Tel Aviv?
Josh Leibowitz, senior vice president of Cunard North America, said the Arison video wasn’t created with the idea it would be widely distributed. But if there’s a Cunard sales event in your town, it will probably be shown. If you make time to see it you won’t be sorry.
Cunard is throwing one amazing opportunity at your feet: The chance to tour the world at a leisurely pace.
Cunard recently announced (h/t USA Today) its Oceans of Discovery program, which is an apt title for a set of voyages that will take myriad travelers to grand destinations.The downside is that you will have to be a bit patient, as the party doesn’t kick off until 2019.
That’s when The World Voyage aboard Queen Victoria launches.
This particular ship is no stranger to wading past some of the most spectacular landscapes in the world. This past January, it became the largest passenger ship to have traversed the Amazon. 2019 will see it help Cunard once again offer a circumnavigation journey that will take several months and see 24 countries over the course of 107 nights.
Voyagers have a wealth of options when it comes to the 2019 program. Boarding the Queen Victoria alone will have you selecting from 37 voyage possibilities.
As the website states, Queen Mary 2 and Queen Elizabeth will also embark on some truly remarkable adventures.
Josh Leibowitz, Senior Vice President, Cunard North America, states, via Cunard: “Across the fleet, Cunard’s Winter 2019 program covers the globe, including places that we have not visited for years. Our itineraries have been designed to offer enriching days in port as well as plenty of time on board for our guests to relax and enjoy all that our ships have to offer.”
While Queen Victoria sets sail to conquer the world, its sister ships will concentrate on “exotic voyages that offer richer, deeper and more regionally-focused itineraries than ever before.”
In the case of Queen Mary 2, this means a few fabulous firsts as it calls at Doha, Qatar; Mormugao, India; Seogwipo, Jeju Island, South Korea and Chennai, India.
Queen Victoria’s world journey starts at $17,579 per person. So at just under $20,000, you are getting the absolute trip of a lifetime.
But if you want to save some bucks and are on this side of the pond, you can skip the trip to Southampton and start the journey on this side of the Atlantic. USA Today puts the price of a voyage from Fort Lauderdale at $15,799.
Royal Caribbean this year spent $50 million renovating the Empress of the Seas for potential use in Cuba. Photo Credit: Tom Stieghorst
Cruise lines are increasingly focusing their capital investments on renovating older ships as fleet sizes grow and attitudes evolve about the kinds of returns they get from new ships versus refurbished ones.
In Europe, where most new ships are built, 20.3% of what cruise lines spent at shipyards last year was for refurbishment, up from 5.7% in 2008, according to a new white paper from Seatrade.
Last year, Carnival Corp. spent more on improvement and replacement of its ships than it did building new ones.
For passengers and travel agents, that translates to having a broader selection of up-to-date vessels from which to choose and new features on older ships, not just on newbuilds.
Cunard Line’s Queen Mary 2 provides a recent example.
The QM2 pulled into its pier in Brooklyn in July after a $132 million “remastering,” one of the most expensive refurbishments ever undertaken. In 25 days at the Blohm & Voss shipyard in Hamburg, Cunard added 30 balcony cabins and 15 solo traveler cabins and completely redid a restaurant and lounge.
It also overhauled the King’s Court buffet restaurant, upgraded the Queens and Princess Grill restaurants and expanded the dog kennels, a feature unique to Cunard.
The atrium of the Ruby Princess, a ship that was refurbished last December. Photo Credit: Tom Stieghorst
The QM2 was one of 40 cruise vessels renovated during the first six months of the year, according to the white paper, which estimated their combined cost of renovation at $1 billion.
That’s more than what the QM2 cost when it was launched in 2004.
There are several reasons why refurbishment is a growing business segment for shipyards.
For one, the fleets keep getting larger. There were 448 ships last year owned by CLIA-member cruise lines. Safety rules dictate that ships go to drydock at least once every five years. Since ships can have a useful life of 30 years or more, each one could get at least six refurbishments.
Some cruise lines are also slowing the pace of new construction. Carnival Corp., with 100 ships already, is sticking to growth of two or three ships a year. So the proportion of its capital spent on refurbishment is growing.
Last year, Carnival spent $981 million on new ships, chiefly the P&O Cruises ship Britannia, and $1 billion on ship improvements and replacements, according to its annual report.
Other cruise lines said the financial returns from refurbishments can equal or surpass those of newbuilds.
Frank Del Rio, CEO of Norwegian Cruise Line Holdings, has roughly doubled the amount budgeted for the drydocking of Norwegian Cruise Line ships, to about $35 million per ship, according to the Seatrade white paper.
In comments to Wall Street analysts last November, Del Rio described it as an alternative strategy to simply churning out new ships to drive revenue.
“We think the return on invested capital on these kinds of choices outpaces the [return] and the payback of new vessels,” he said. “We’ve got billions of dollars invested in these ships. You have to maintain them at the highest standards if you expect to achieve these higher yields.”
As a result, all of Norwegian’s ships except one will undergo refurbishments between 2016 and 2018.
Norwegian and other cruise lines use drydock to add to older vessels features that have proven to be hits on newbuilds. This fall, Norwegian will add Margaritaville restaurants to the Norwegian Breakaway and Getaway after the concept was successful on the Norwegian Escape.
Carnival Cruise Line’s $500 million Fun Ship 2.0 program is largely about adding features to older ships that keep them competitive and consistent with its latest vessels.
“They’re looking to have a homogenous brand,” said Tony Peisley, a cruise industry analyst who authored the Seatrade paper.
Cruise lines also struggle with what to do with their oldest ships, which still have value but are no longer very competitive in North America. Ten years ago, they were often transferred to European lines, but as Europe has struggled economically that trend has been reversed.
Patterned gray carpet was installed throughout the Azamara Journey during its drydock earlier this year. Photo Credit: Tom Stieghorst
Royal Caribbean International this year took back the Empress of the Seas from its Spanish subsidiary, Pullmantur, and spent $50 million renovating it for potential use in Cuba, an emerging market.
Also sailing to Cuba is the Adonia, an aging P&O ship that Carnival Corp. transferred to the Fathom brand following a drydock in March that included both technical work and some redecorating.
The Adonia was refit and made available to Fathom, in part, to find a use for a ship that wasn’t doing well for P&O.
“That’s what they’ve been doing, they’ve been refurbishing, not retiring,” said Vince Ciepiel, an analyst at Cleveland Research who has expressed concern about lines having too much capacity.
Peisley said cruise lines are loath to sell ships to competitors, because, “It’s not so much that they can’t get rid of them as they don’t want to sell them to their rivals. So that kind of limits their options.”
The Seatrade white paper identifies four levels of refurbishment, ranging from adding new paint and carpets at a minimal cost of between $4 million and $5 million to a redo the size of the QM2.
Most fall in the $30 million to $50 million range and involve a combination of technical upgrades, such as new air scrubbers, and retrofits of popular features, such as bars and restaurants.
While new ships are built almost exclusively in Europe, refurbishments are done there as well as in Canada, the U.S., Singapore and the Bahamas. This year, the Grand Bahama Shipyard in Freeport is by far the busiest yard, with 19 cruise ship drydocks on its schedule.
Carnival Corp. and Royal Caribbean Cruises Ltd. both have a 40% ownership stake in the yard, which was founded in 2000, and its location cuts transit times for refurbishment of ships based in the Caribbean.
Wetravel2u's Weblog 