Royal Caribbean and Norwegian: Differing Strategies on Caribbean Cruises

Royal Caribbean and Norwegian: Differing Strategies on Caribbean Cruises

Royal Caribbean International and Norwegian Cruise Line are taking different business approaches when it comes to Caribbean deployment.

Caribbean itineraries will make up roughly 65 per cent of Royal Caribbean’s deployment this year, compared to approximately 33 per cent for Norwegian Cruise Line, according to the 2023 Cruise Industry News Annual Report.

Next year those numbers should climb for Royal Caribbean, which will put the Icon of the Seas in the year-round Caribbean market, sailing week-long cruises from Miami in January. That will be followed by the Utopia of the Seas, which will sail short voyages year-round from Port Canaveral, with the Miami-based cruise line betting big on the Caribbean cruise market, including the short cruise business.

“Utopia will be the first Oasis-class ship that will be entirely focused on short cruises in the Caribbean, supporting our strategy of competing with land-based vacation alternatives and driving new-to-cruise customers into our vacation ecosystem as we seek to close the value gap,” said Jason Liberty, president and CEO of Royal Caribbean Group, on the company’s second-quarter earnings call in July.

Norwegian Cruise Line has taken the opposite approach.

Norwegian’s short cruise portfolio, which account for 25 per cent of its deployment in 2019, will make up just seven per cent of cruises in 2023, according to the company’s second-quarter earnings presentation.

It also means Caribbean deployment is down some nine per cent this year when compared to 2023.

“We strategically shifted our deployment to longer, more immersive itineraries at the Norwegian Cruise Line brand and increased our concentration of premium destinations while reducing our Caribbean deployment,” said Harry Sommer, president and CEO of Norwegian Cruise Line Holdings, speaking on the company’s second-quarter earnings call.

“This was designed to attract a higher quality guest and maximize our competitive position.”

CFO Mark Kempa noted: “This is really about yield and EBITDA where we believe being in more premium itineraries that are booked further in advance, giving us a much longer booking curve and a more stable and predictable demand profile, which allows us to manage demand, manage our marketing a little bit more effectively and not rely so much on close-in, unstable and unpredictable demand is really key to our success.”

Former Maasdam Potentially Sold to French Start-Up Cruise Line for $30 Million

Former Maasdam Potentially Sold to French Start-Up Cruise Line for $30 Million

The former Maasdam from Holland America Line has been sold, according to Masters Shipping, who confirmed it acted as the broker on the sale of the ship to a company known as CFC in an email sent to Cruise Industry News.

The ship has most recently been known as the Aegean Myth and has reportedly been sold to a French start-up cruise line for $30 million, according to a report from Crew Center.

Now heading to Piraeus, the vessel has been renamed the Renaissance. 

Originally launching as the Maasdam, the Fincantieri-built ship debuted in 1993 and sailed until the pandemic.

Carnival Corporation then sold the ship to Seajets, which is under the control of Greek businessman Marios Iliopoulos, who has assembled a fleet of laid-up cruise ships.

CFC, according to Crew Center, is new French start up Compagnie Francaise De Croisieres. No further details were available at press time.

Ship History: Carnival Sensation

Ship History: Carnival Sensation

As the Carnival Sensation is retired from service, Cruise Industry News looks at the history of this popular Fantasy-class vessel.

1990: The Fantasy entered service as the lead ship of an eight-vessel class that also includes the Sensation – a 2,040-guest vessel built by the Kvaerner Masa-Yards in Finland, at a cost of $300 million.  

1993: The Sensation is christened in November, with four Carnival vice presidents serving as godmothers: Vicki L. Freed, Roberta Jacoby, Cherie Weinstein and Geri Donnelly. The vessel then sets sail on its inaugural voyage, launching a year-round program of weekly Caribbean cruises from Miami.  

1998: After undergoing its first mandatory drydock, the Sensation is repositioned, debuting in Tampa. In December, the vessel launches a series of week-long cruises to Grand Cayman, Cozumel and New Orleans from its new Florida homeport.

2000: The Sensation is reflagged, with its registry port changing from Monrovia, Liberia, to Nassau, Bahamas.

2002: As Carnival shifts its fleet around Florida and the Gulf Ports, the Sensation is transferred to the short cruise market. Still sailing from Tampa, the vessel takes over the 1986-built Jubilee’s schedule in August, offering four- and five-night cruises to the Western Caribbean.

2004: With the new Carnival Miracle debuting in Tampa, the Sensation is once again repositioned. This time, the vessel debuts in New Orleans, launching a series of four- and five-night cruises to Mexico in October.  

2005: As Hurricane Katrina hits Louisiana in September, the Sensation is diverted to Galveston with two of its scheduled cruises now departing from the Texas port.

2005: Soon after, the vessel is chartered to FEMA as part of the Hurricane Katrina relief efforts in New Orleans. During a six-month period, the Sensation remained docked in the Gulf region while serving as a temporary house for people affected by the natural disaster.

2006: After its first significant renovation, the Sensation resumed service in March. With new features that included a nine-hole mini-golf course, larger kid facilities and a reconfigured aft lounge, the vessel kicked off a series of short cruises to the Bahamas from Port Canaveral.  

2007: In line with other ships of the fleet, the Sensation received the Carnival prefix to its name, becoming the Carnival Sensation.

2009: As part of the Evolutions of Fun, a $250-million fleet update program, the Carnival Sensation saw a major refit in 2009. At the 35-day drydock, the vessel also received 98 balconies, which were retrofitted to existing cabins.

2016: As part of a deployment shuffle, the ship is replaced in Port Canaveral by the Carnival Victory and returns to Miami. Starting in February, the Carnival Sensation debuts a program of five- and four-night cruises from its new homeport, with itineraries visiting the Caribbean, Mexico and the Bahamas.  

2017: In February, the vessel emerges from another extensive renovation, sporting a selection of new food and beverage concepts, as well as a new children’s play area and more.

2019: During the first months of the year, the Carnival Sensation offered cruises to Havana, Cuba. The Miami-based program was halted in June, as the U.S. Administration banned recreational travel to the country. 

2020: On March 9, the vessel departed on what ended up being its last revenue cruise. Leaving from Miami, the five-night voyage included visits to Grand Cayman and Ocho Rios. Soon after the voyage, the vessel entered a lay-up status, along with the entire Carnival fleet.

2020: In October, while out of revenue service near Florida, the Sensation answered a distress call and rescues 24 individuals from a sinking boat.

2022: As part of reviews of its fleet and homeport strategies, Carnival announced the retirement of the Carnival Sensation in February. A few weeks later, in late March, the vessel sailed from Miami to Aliaga, where it is set to be scrapped over the next months.

Former Costa neoRomantica To Be Scrapped

The Antares Experience – formerly known as the Costa neoRomantica and Celestyal Experience – is getting scrapped, according to Gadani Ship Breaking Yard.

The Pakistani shipyard posted several photos and videos of the former Costa Cruises ship on its Facebook page.

The ship was originally launched as the Romantica in the 1990s and renamed as the neoRomantica after Costa gave it a 90-million-euro upgrade in 2011-2012 adding two half decks, new staterooms and additional balcony-equipped accommodations.

Celestyal Cruises took delivery of the ship in summer 2020 and renamed it as the Celestyal Experience, according to the Secondhand Market Report by Cruise Industry News. The 1,800-guest ship immediately became the largest ship in the company’s fleet but, sadly, never sailed for the cruise line.

Celestyal CEO, Chris Theophilides, previously said that the purchase of the Experience allowed the cruise line to see “many more destinations.” It was expected to sail on March 5, 2022, with the seven-night Three Continents itinerary, calling in Greece, Turkey, Israel, Egypt and Cyprus. The ship’s sales price was not disclosed.

However, those operational plans were quickly scrapped as the pandemic showed no signs of stopping, and Celestyal published a statement on selling the ship – at the time to an undisclosed buyer. The vessel shortly reemerged as the Antares Experience.

Azamara’s Fleet Comes Under V.Ships Leisure’s Ship Management

Azamara’s four-ship luxury fleet is now under the ship management of V.Ships Leisure, which has assumed all technical oversight, crewing and port operations, according to Per Bjornsen, CEO, V.Ships Leisure.

After private equity firm, Sycamore Partners’ acquisition of Azamara from the Royal Caribbean Group earlier this year, the Azamara Onward entered V.Ships’ management following the ship’s acquisition, while the company brought the Quest into management on October 23, the Pursuit on October 28 and the Journey on October 31.

Detailed Way

“We’ve been through the plan in the most detailed way to ensure there is no change to the guest experience. That has been the core,” said Bjornsen, noting that while it is rare to decouple brands from a major cruise group, V.Ships has done it several times.

Taking over four sister ships, the crew will stay the same, but be managed by V.Ships, while other new systems have been put in place.

“We are moving toward more data-driven management for planned maintenance, for example,” Bjornsen told Cruise Industry News. “The data is being migrated to our platform, ShipSure, which is the digital platform in the centre of everything we do. There has been detailed planning with Azamara, Royal Caribbean Group and our team to make this smooth.”

“There has been thorough planning of crewing, the procurement hand over and customization of the safety management system – making sure there are no gaps compared to the service which was provided previously. However, we see this as a greenfield opportunity to do things smarter.”

Four Ships

“When you have the opportunity to have four sister ships, it’s quite interesting what you can do, comparing the fleet, how you operate and sharing best practices. There is a tremendous amount of data and if you use it cleverly you can move towards predictive maintenance,” Bjornsen explained.

Moving to V.Ships, Azamara has access to a global network of offices, purchasing power and redundancy of resources.

“It’s important that we share the same culture,” Bjornsen said of Azamara’s and Sycamore’s relationship with V.Ships. “Safety is the number one priority and we are going into this with a long-term horizon working together as partners.”

Crew Members Go Months Without Shore Leave During Pandemic

Some crew members working back onboard have not stepped a foot ashore for months, according to Cruise Industry News’ research.

Employees of AIDA, Norwegian Cruise Line and Marella Cruises, and other major cruise lines have said on the grounds of anonymity that they have largely not been allowed to leave the cruise ship they’re working on, with one crew member admitting that this left him feeling “pretty depressed.” Some crew interviewed asked not to identify their ships or employers. 

An employee working on the Norwegian Jade said that he and his fellow crew members have been on board for two months with only one shore leave – for vaccination purposes.

“We left the ship escorted with busses to get our vaccinations done where there were military police. Once vaccinations got done, we were escorted back to our bus to go straight back to the ship,” he said.

“Everyone was assigned to a group with a leader and counted before (boarding) the bus and on the bus,” he added.

However, according to him, Norwegian's no-shore-leave policy will be re-evaluated once the ship cruises with guests for two months.

“Shore leave might be discussed,” he said. “If a crew member is coming to travel, bring a long lens camera because right now it’s about staying healthy while supporting our families.”

A crew member with a major cruise line also said that he was not allowed to go onshore.

“Before the pandemic, crew shore leave was allowed whenever crew member was off duty, with shuttle buses organized more or less every 30 minutes, or you could go on your own,” he explained.

An employee working on a Marella cruise ship for the last two months said that he was lucky to be able to go ashore before shore leave was banned entirely.

“I have been ashore once for 30 mins, which was strictly to buy essentials and come straight back. Shortly after, shore leave was banned entirely by the company because they are restarting operations soon, and they worry that if a crew member brought COVID onboard they wouldn’t be able to have passengers,” he said.

“I’ll be on board for another few months but highly doubt I’ll be able to go ashore again,” he added.

According to him, prior to the pandemic, crew members could go ashore “more or less every day.” Not being able to leave the ship, as well as lack of socialization, is making crew members “pretty depressed,” he said.

However, other crew members were more optimistic.

“Shopping-wise, the cruise lines have brought the necessities onboard to purchase. They also have agreements with Amazon and port agents so that you can still purchase personal items online. Ships need to stay in the guidelines right now in order to keep us up and running,” one crew member said.

New MSC Ships As Green As Possible

A wide range of technologies will be on display on MSC Cruises’ pair of 2021 newbuilds, the Seashore and Virtuosa.

According to Linden Coppell, director of sustainability, both ships will have hybrid exhaust gas cleaning systems, selective catalytic reduction and shore power capability

Potable water will be generated aboard through reverse osmosis, and wastewater will be treated via the latest advanced technology.

“For every new class of ship, we really work on the energy and fuel efficiency piece,” she told Cruise Industry News, “making sure each new ship is as efficient as it can be.”

That means not only new systems but big data.

“For the Virtuosa, we are looking at how the Grandiosa is operating now and the results,” Coppell said. “We collect a lot of data from the ships and analyze it, and work with the shipyard.”

The company expects the Virtuosa to be more efficient than her sister vessel, the 2019-built Grandiosa.

“We are looking at internal (items), like the HVAC systems,” Coppell explained. “These are the big technology pieces, but then there is a lot of fine-tuning, adjusting and reporting back to the captain and his team.”

With the 5,200-guest World Europa debuting in 2022 and featuring not only LNG-fuelled engines but also a fuel cell, MSC will underscore its leadership position in green cruising.

The World Europa will be MSC’s first ship powered by LNG and part of a series of five LNG-powered newbuilds.

The World Europa also features the first solid oxide fuel cell aboard a cruise ship, where LNG will help create heat and thus electricity for the hotel load through the fuel cell. The fuel cell is expected to be scaled over time from its initial 50KW output.

Norwegian Cruise Line To Repatriate All Non-Essential Crew

Norwegian Joy pictured above.

Norwegian Cruise Line Holdings will repatriate all crew members that joined recently and are not part of the skeleton crew aboard the fleet, according to Crew Center who cites an announcement made at a meeting.

This announcement comes just a couple of months after Norwegian boarded thousands of crew members to prepare the ships for a resumption of service after the CDC regulations allowed for conditional cruising, which has now been pushed to at least May.

“(T)he crew onboard received a letter with all the details regarding the latest repatriation process,” Crew Center reported.

According to the Crew Center website, the repatriation will take place on two appointed ships: The Norwegian Joy and the Norwegian Encore.

The Joy will be gathering non-essential crew from the ships stationed in the Caribbean and then proceed to the Philippines; while the Encore will be collecting crew on its journey from Southampton to Asia.

“The repatriation process will be similar to the one that took place last year with crew transfers to the appropriate vessel, before the crew finally sails to their homes in India, Indonesia and the Philippines, with anticipated arrival to the final destinations in late March or early April 2021,” Crew Center wrote.

“This will be a long and sad journey for all the crew onboard as their hopes and dreams to be the first to set sail with guests onboard will not materialize at this point. They have made countless sacrifices, PCR tests, and quarantines to join the ships again to serve guests and ultimately provide for their family,” it added.

According to Crew Center, this decision did not come easy to Norwegian and was not in the company plan. The cruise line promised the crew members who are to be repatriated that they’ll be prioritized for new assignments “as much as possible.”

A trio of Cruise Ships Drydocks To Start 2021

The cruise ship drydock market will be hot for 2021, as operators push scheduled refits and class surveys forward ahead of returning to service

Work scopes are expected to be mandatory class surveys, inspections, and technical and safety maintenance, as the majority of big projects scheduled for 2020 and 2021 have been pushed back, Cruise Industry News reported in its 2021 Drydocking and Refurbishment Report.

Without passengers on the ship, the drydocking is when the cruise lines pounce to make any changes ranging from repair to hotel and facility upgrades.

Among the cruise ships that recently drydocked is the 1,778-guest Marella Explorer 2. She is staying at Damen in Amsterdam, Netherlands.

The Marella Explorer 2 has had her cabin ceilings and walls resprayed, bathrooms updated. Some of her suites got brand new solid wood floorings, and the Market Place got a contemporary resin floor.

The 2,600-passenger Sapphire Princess, which is operated by Princess Cruises, is currently drydocking at the Sembawang Shipyard in Singapore. The ship was previously scheduled for a drydock in April 2020, which got postponed after the start of the pandemic.

Finally, Dream Cruises’ 1,804-passenger Explorer Dream is not drydocking yet but will be between Feb. 19 and 25. The works will take place in Kaohsiung, Taiwan.

Virgin Goes with Bipolar Ionization

Scarlet Lady.

“HVAC is one of the most important systems aboard a cruise ship. To that end, we designed our ship based on industry best practices, working with Fincantieri and HVAC engineers. We are trading off energy consumption for passenger comfort, quality, and safety,” Andy Schwalb, chief marine and technology for Virgin Voyages, told Cruise Industry News.

“So, instead of building the most efficient air-conditioning system possible, we built the best air circulation system possible for the comfort of our guests and crew,” he added.

Aboard the Scarlet Lady, each public space has its own air-handling system, designed and optimized for each space.

“We are constantly putting fresh air into public spaces and cabins. While other ships may pump in the fresh air too, the question is how often that air is exchanged. Our system is smart and adjusts according to how many people are in the room. So, the air may be exchanged every couple of minutes or every five to seven minutes. It can go faster or slower.

“Some large spaces also have cooling coils that help keep the air cool, but we are not recirculating air.

“We also change the air in every cabin every few minutes. Each cabin has its own cooling unit, and there is no cross-contamination between cabins.”

“There are many ways to clean the air,” Schwalb said. “The most basic is to move fresh air through a filter and suck out the old air. That works up to a point, depending on how often the air is exchanged and how big or small the particles are that go into the filters. Some companies have gone to MERV 13 filters, which have a finer mesh, and some are putting UV lamps in their air handlers.

“We have chosen a different route, covering 100 per cent of the ship with bipolar ionization.”

Schwalb explained how it works: “The fresh air comes into the space ionized with positively and negatively charged ions. They are attracted to particulate matter – pathogens, allergens, bacteria dust – and attach themselves. By doing so, they destroy the pathogens by stripping the hydrogen atom and make them bigger and heavier, which means the filters can better trap them, they are no longer able to attach themselves to people’s lungs, and they also fall to the floor.

“99.92 per cent of viruses are killed instantaneously.”

In-door air quality, in general, is a problem, according to Schwalb, not just on cruise ships. Any building, any enclosed space, has challenges such as norovirus and influenza, for example, and the ionization takes care of all of that.

“In addition, we are also upping our filtration to MERV 13 where it makes sense,” he added. “We are doing absolutely everything that is possible. First of all, we want to keep everybody safe and healthy; and secondly, we think this will improve the (cruise) experience over the long run.”

Excerpt from Cruise Industry News Quarterly Magazine: Winter 2020-2021

'Positive Signs' as Holland America Moving Six Ships Toward U.S.

Holland America Line is preparing for a gradual restart and is said to be moving six cruise ships toward the U.S. citing positive signs and a new conversation around the return to service.

The news came in a letter sent to crew from President Gus Antorcha, reported by Crew Center, and also obtained by Cruise Industry News.

"Following in-depth discussions with the CDC, other government agencies, and medical and science authorities, we have decided to start moving six Holland America Line ships toward U.S. waters over the next several weeks to begin completing the requirements for conditional sailing," Antorcha said in the letter sent to the crew.

The ships heading to U.S. waters are the Koningsdam, Nieuw Statendam, Nieuw Amsterdam, Westerdam, Zuiderdam, and Noordam. Holland America did not specify port information but the line has traditionally had a strong presence in the winter from Port Everglades and Tampa, which would pull from a large drive-to market.

“While there is still much to be done, this is an important first step toward our goal of resuming cruise operation," the letter said.

"Holland America Line will continue to work with the CDC on our eventual return to guest cruise operations. We are fully aligned with the CDC on our top priorities for compliance, protecting the environment, and the health, safety, and well-being of our guests, the people in communities we touch, our crew, and shoreside employees."

Zito: Swan Hellenic Ready for Strong Start-Up

The CEO of Swan Hellenic, Andrea Zito, said that the company is in a good position ahead of its launch in 2021.

“We are receiving only positive comments from the former customers of Swan Hellenic. The sector is reacting very well to the fact that Swan Hellenic is being resurrected in a way,” Zito told Cruise Industry News.

The first of two new expedition ships, the m/v SH Minerva, debuts into service for the brand in 2021.

The revived Swan Hellenic launched earlier this year. However, the brand is actually 70 years old and was acquired in December 2020.

“One and a half [years ago], the group started the negotiation and placed the order for two ships with Helsinki shipyard for delivery at the end of 2021 and mid-2022. And then the pandemic came. This was not really planned,” Zito said.

The coronavirus pandemic caused Swan Hellenic to postpone any announcements from spring to July. However, otherwise, Zito’s company had adjusted to the challenging conditions.

“It’s a little bit slower, but we are doing things very efficiently. It is amazing to realize how many things you can accomplish without travelling continuously,” he said, describing the challenges of having offices in different European countries.

Zito said that Swan Hellenic offers what seasoned travellers look for.

The company will sail to destinations in New Zealand, Pacific Islands, Russia, and, Zito said proudly, the semi-circumnavigation of Antarctica.

“Our ships are some of the very few ships that have Polar Class 5 ... So we can stay longer, we can go deeper in the environment and, most importantly, we can go safer because the characteristics of the ships are of higher safety standards to ensure that passengers are well protected,” he said.

According to Zito, Swan Hellenic’s ultimate goal is to cover the whole world.

“It's not just a box-ticking exercise, it caters to people who are thirsty for knowledge: they are curious and they want to discover various parts of the world. And the world is still very big.” 

A More Profitable Carnival Corporation Expected To Emerge

A leaner, more profitable Carnival Corporation is likely to emerge following the COVID-19 pandemic, according to Cruise Industry News’ calculations.

One important aspect will be what now seems like the overdue removal of 18 existing ships from the fleet.

When Carnival Corporation announced earlier this week that it expects to dispose of 18 ships, eight of which have already left the fleet, it also said that the ships represent 12 per cent of the company’s pre-pause capacity, but only 3 per cent of operating income in 2019.

That means that the 18 ships generated only approximately $98.3 million in operating income, compared to approximately $3.2 billion for the other 87 ships (Carnival listed its fleet at 105 ships for the end of its fiscal year 2019).

Assuming that the 18 ships represented their fair share of operating costs at 12 per cent, their removal prior to year’s end 2019 would have cut operating costs by approximately $2 billion, potentially resulting in operating income of approximately $5.4 billion.

Thus, according to Cruise Industry News estimates, Carnival’s operating income and net income could have been $2 billion more for 2019 if the 18 ships had left sooner, with net income of approximately $5 billion instead of $3 billion, or approximately $7.37 per share instead of $4.32 per share.

In addition, the disposed of ships will be replaced by larger and more efficient tonnage that will likely command higher ticket revenues and onboard spending while incurring lower operating costs.

Big Cruise Companies Burning Through $1 Billion a Month

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Carnival Corporation, Royal Caribbean Group and Norwegian Cruise Line Holdings are burning through over $1 billion per month without revenue-generating cruises in service.

According to the 2020 Cruise Industry News Annual Report, the three companies account for approximately 73.8 per cent of the global cruise market share.

Carnival Corporation said that during its pause in guest operations, the monthly average cash burn rate for the second half of 2020 is estimated to be approximately $650 million per month.

At Royal Caribbean Cruises, the company said it estimates its cash burn to be, on average, in the range of approximately $250 million to $290 million per month during a prolonged suspension of operations.

Norwegian Cruise Line Holdings, which has the smallest fleet of the three companies, said its cash burn is approximately $160 million per month during the suspension of operations. The average cash burn per ship per month is $5.7 million

Croatian Media: Flying Clipper Has Been Sold

Croatian Media: Flying Clipper Has Been Sold

A news report out of Croatia says the Flying Clipper has an owner.

"As we find out in Brodosplit, the ship has been sold, and the new owners of the Flying Clipper will be revealed soon," 24sata reported.

Built for Star Clippers at Brodosplit in Croatia, the Flying Clipper was completed earlier this year but was never delivered to its owner.

Brodosplit has since been showing off the ship and has released various photos and videos, showing a completed interior, staterooms and public areas. Sources previously told Cruise Industry News that the vessel was available to other customers, either for sale or on a long-term charter for Brodosplit.

The shipyard did not reply to a request for comment. 

The ship is said to be the most advanced sailing vessel in the world, built for 300 guests at an estimated cost of $100 million. 

Curacao Traffic Boosted by New Pier

Curacao Traffic Boosted by New Pier

Traffic is skyrocketing in Curacao as the 2018 calendar year is set to see a 16 percent increase in passenger arrivals boosted by a second mega pier, which opened to ships in late 2017. Additional mooring dolphins added early this year allow for even bigger ships to dock, according to Raul Manotas, COO of Curacao Ports.

“With our new mega pier completed, we expect to see a continuation of the growing trend of the last decade. Our objective is to reach the million passenger mark,” Manotas told Cruise Industry News.

Summer traffic this year includes 63 calls and accounts for about 23 percent of passenger arrivals.

“The second mega pier was essential in driving additional growth opportunities in the industry,” continued Manotas. “Our primary objective is to further brand the destination and establish strategic partnerships that can promote the destination. Curacao offers a unique blend of culture, history, gastronomy and entertainment that we will capitalize on.”

Interporting is done primarily by niche and luxury lines, Manotas said. “The objective is to further promote this among the smaller lines,” he added.

FEMA Carnival Charter Cost $74.7 Million

The Federal Emergency Management Agency’s (FEMA) charter of the Carnival Fascination will cost the agency $74.7 million, according to the contract between FEMA and Carnival Corporation, which was obtained by Cruise Industry News through a Freedom of Information Act (FOIA) request.

The ship was chartered to provide housing for relief staff in the United States Virgin Islands following a number of hurricanes in September.

The charter period runs from October 11, 2017, to February 3, 2018, at a cost of $39.7 million, while a separate provision for port costs and other vessel costs comes in at $35 million, totalling $74.7 million.

By comparison, a 116-day operating period for the 2,056-guest Carnival Fascination would have resulted in gross revenue of approximately $44.2 million (versus the $39.7 million for the charter), calculated using gross revenue per passenger day reported by Carnival Corporation in the fourth quarter of 2016 and analyzed by Cruise Industry News.

By comparison, FEMA chartered the Grand Celebration in a similar deal for $25.8 million. 

The contract stipulates Carnival will provide three hot and cold buffet meals per day as well as drink availability (water, coffee, tea, juice) between meals. Staterooms will be cleaned on a weekly basis. In addition, Carnival will provide access to public spaces for FEMA personnel.

The separate $35 million line item includes docking and port fees in San Juan, various logistics provisions, waste removal, fuel costs, incremental costs related to crew compensation, and the “refurbishment of the ship at the end of the charter period to bring the ship to the same standards as the beginning of the charter period.”

NCLH: Tickets and Onboard Drive Q2; Food Spend Down

Increased ticket and onboard revenue drove Norwegian Cruise Line Holdings (NCLH) record second quarter (Q2) earnings.

Despite carrying fewer passengers than last year, 569,857 down from 574,838, NCLH posted more passenger cruise days, 4,517,788 up from 4,237,020, and higher gross and net ticket and onboard revenue per passenger day.

The passenger number was down due to longer cruises, according to NCLH.

Operating costs were also up, except food costs that were down for Q2 and for first six months of the year, despite an increase in passenger cruise days.

The reduction in food costs were primarily due to a series of purchasing initiatives undertaken over the past year. In a prepared statement to Cruise Industry News, NCLH said: “We have been successful in finding significant efficiencies across our food distribution through a concerted effort to improve processes in delivering consumables to our vessels around the world. In addition, we have leveraged our buying power to deliver substantial hard savings across our food purchasing without compromising quality.

“For example, on a number of key proteins that represent the highest cost items across our food costs, we have been able to cut costs significantly simply by purchasing directly from the suppliers and cutting out middlemen. These initiatives have resulted in savings while providing the same, or in many cases, better quality protein.

“During this period we have also been refining the dining experience across our fleet, and with the benefit of guest research and feedback, we have refined our menus to better meet the preferences of our guests and, as a result, we have seen our guest experience scores improve year over year.”

NCLH spent $47.3 million on food in the second quarter of this year and $95.5 million for the six-month period, compared to $49.8 million and $100.8 million, respectively, last year.

Gross revenue per passenger day was $297.52 this year, up from $280.11 last year. Net revenue per passenger day was $229.63 this year, up from $216.55.