Tag Archives: royal caribbean cruises ltd

Celebrity Cruises orders pair of 2,900-passenger ships

Posted on by
Reply

By Tom Stieghorst

Celebrity Cruises said it has ordered two 2,900-passenger ships from the STX France shipyard in St. Nazaire.

The ships are scheduled for delivery in the fall of 2018 and early 2020.

Celebrity’s most recent ship, the 3,046-passenger Celebrity Reflection, was delivered in the fall of 2012.The line recently agreed to send its oldest ship, Celebrity Century, to a new joint venture in China.

Celebrity’s parent, Royal Caribbean Cruises Ltd., said the ships are being built under the Project Edge name. RCCL said they will deliver small-ship itineraries with large-ship amenities.

“STX France designs and builds some of the most innovative and stylish cruise ships in the world, and Project Edge offers them the opportunity to again set a new standard for modern iconic architecture,” said Michael Bayley, presdient and CEO of Celebrity.

Contract costs for the ship were not disclosed. With the addition of the two new orders, RCCL said company-wide capacity is scheduled to increase by 2.4% this year, 5.5% next year, 6.7% in 2016, 3.8% in 2017 and 4.3% in 2018.

The 117,000-gross-ton ships will be part of a new class of vessels for Celebrity. the line currently operates five Solstice-class vessels, including Celebrity Reflection, and four Millennium-class vessels.

Celebrity competes in the premium segment with Holland America Line, which has a 2,650-passenger ship called Koningsdam under construction for delivery in February 2016.

Learning from RCCL’s cruise line partnerships

Posted on by
Reply

By Tom Stieghorst
*InsightForming partnerships to operate cruise lines is a tricky business that can have hard-to-predict consequences.

Take, for example, two cruise lines that Royal Caribbean Cruises Ltd. (RCCL) got involved with in Europe.

One, Spain’s Pullmantur, has been a qualified disaster. As the economy in Spain soured over the past decade, Pullmantur’s results worsened. Because RCCL had acquired Pullmantur outright in 2006, it had to accept the subsidiary’s losses as its own on profit or loss statements.

Last year, RCCL took a $414 million writedown of Pullmantur’s assets. The only positive has been Pullmatur’s growing business in Latin America.*TomStieghorst

The other cruise line Royal took an interest in is Germany’s TUI. It remains 50/50 partners in TUI with TUI AG, which means it can’t incorporate either losses or profits directly in its bottom line.

In this case, it wishes it could. Unlike Spain, the German economy has mostly been strong and TUI has been highly profitable.

“TUI Cruises has been a very solid performer,” RCCL Chairman and CEO Richard Fain said in a recent conference call with Wall Street analysts. “I dearly wish they were included in our yield stats because it would make them look very good.”

Royal Caribbean reported $18.8 million of “other income” in a third quarter in which it earned $490.2 million. Most of that came from TUI, CFO Jason Liberty said.

The exact structure of how cruise line partnerships are formed is worth keeping in mind as both Royal Caribbean and Carnival Corp. negotiate joint ventures in China to further their interests in that key country.

The devil is in the details, as they say. It should be interesting to see what the details are if and when these Chinese ventures are finalized.

Biggest, newest ships can thrive in Europe, Asia: Goldstein

Posted on by
Reply

Goldstein - 'In the Mediterranean, Europe and Asia-Pacific, the largest ships can be viable and thrive'Goldstein – ‘In the Mediterranean, Europe and Asia-Pacific, the largest ships can be viable and thrive’

Oasis of the Seas turning around in Barcelona this month and Quantum of the Seas going to China next year show that Europe and Asia can handle cruising’s biggest and newest hardware. As Adam Goldstein, president and coo of Royal Caribbean Cruises Ltd., put it: ‘In the Mediterranean, Europe and Asia-Pacific, the largest ships can be viable and thrive.’

When Oasis of the Seas made its inaugural call at Barcelona two weekends ago, it generated three times the media response of anything the company has ever done in the region, Goldstein said. Apart from the publicity, the operations were impressive—a ‘great accomplishment’ by the Port of Barcelona.

‘It clearly shows Europe is capable right now of supporting the biggest ships in the world and the infrastructure exists to support Allure of the Seas for a full season next year,’ Goldstein told Seatrade Med in Barcelona last week. ‘We now have the opportunity to deploy our biggest and best new ships here. This bodes well for the Mediterranean.’

It’s the culmination of a sequence of development. The current Oasis ‘micro-season’ paves the way for Allure’s full season. Going step by step over time gives everyone the chance to acclimate.

‘The infrastructure that exists to handle 6.4m passengers wasn’t here 20 years ago,’ Goldstein said. ‘The fundamental capability to accommodate growth in the Mediterranean is available if there’s adequate planning.’

From a source market perspective, Europe remains ‘a mainstay of the business for us and the industry. We’d all like to see the macroeconomic situation in Europe be better than it is,’ he added. However, the good news is that Spain is showing signs of recovery.

The market is growing, although at a slower rate. ‘We’re able to generate profitability here. It’s really attractive to cruise in Europe. The business is doing well,’ Goldstein told Seatrade Insider during an interview in Barcelona.

Last year cruises in Europe attracted nearly 1m non-Europeans, demonstrating resilience following the global recession.

And Asia is emerging as the third major cruise operating region of the world.

After the recent deal to sell Celebrity Century to China’s Ctrip.com International, it’s too early to tell how the relationship will develop. ‘We’re in discussions to see,’ Goldstein said. ‘They’re already a producer for us. We hope to maintain and build the relationship.’

The fact that Quantum of the Seas will operate year-round from Shanghai is ‘remarkable. It’s an amazing development for the Royal Caribbean International brand and the company to so quickly have one of our newest ships operating in China.

‘I don’t think anybody foresaw something like this,’ he said, adding that just 10 years ago, China was ‘a gray spot on the map’ for the cruise industry.

Next year Royal Caribbean will have four ships there, counting also Mariner of the Seas, Voyager of the Seas and Legend of the Seas.