A Promising 2021 for Limassol Cruise Terminal

Cruising is back to DP World Limassol’s Cruise Terminal, said its Commercial Manager Lazaros Charalambous.

“Cruises are going strong until October 2021,” he told Cruise Industry News.

Royal Caribbean, Celestyal, Seabourn, Azamara and Celebrity have all either already returned or are about to return to Cyprus with their ships this summer.

“Moreover, cruise lines have been taking the necessary steps to ensure that COVID-19 does not spread to their cruise ships, with many requiring passengers to be vaccinated or hold a negative PCR test. This has boosted the morale of cruise lovers, who have been itching to get back to the seas for some time now,” said Charalambous.

He added that the Cyprus government has prepared and announced a “rigorous health protocol for cruises, which will add to the momentum of the industry.”

“As it comes to the year 2022, I believe that demand will continue to increase, as more passengers will be vaccinated and keener than ever to travel. I strongly believe that (Cyprus) has great potential to further develop the cruise sector and attract many more cruise lines and passengers,” Charalambous noted. “Cyprus’ stakeholders, including DP World Limassol, are hard at work to promote the safe conduct of cruise tourism and successfully seize the opportunity of the widespread reshuffling happening in the cruising industry because of the pandemic, with a view to establishing the Limassol port as a major cruise hub in the Eastern Mediterranean.”

According to him, DP World Limassol operates a strict environmental policy in an effort to reduce its footprint as much as possible.

“We use energy-efficient processes and products, regularly monitor and seek to improve energy efficiency across our operations, while we have adopted an ‘impact and sustainability' and recycling policy throughout our business. At the global level, DP World aims to reduce its output per unit of movement by increasing efficiency and promoting clean energy, with the ultimate goal being to create a zero-emission supply chain across our networks,” Charalambous said.

The port also tries to forge partnerships with local organizations and boost its community engagement.

“We regularly join forces with the local municipality as well as civil society organizations like CYMEPA, to carry out a series of activities such as beach clean-ups, supporting them in their efforts to make Limassol a greener city. Our aim is to help Cyprus achieve its sustainability targets by investing in the port’s equipment, digitization and automation. Such investments, boost the port’s efficiency and resilience, helping it reduce its environmental footprint,” Charalambous said.

The port is always assessing the best international practices while monitoring its own facilities to identify areas for improvement, he explained. “Most recently, we opened two duty-free shops within the terminal, providing exclusive offers on luxury items and a comfortable shopping experience. We have (also) upgraded our check-in equipment, and we are working with the local authorities to improve the overall efficiency of the terminal,” explained Charalambous.

He said that he believes that the pandemic has presented the port industry with “an opportunity to embrace digitization and automation.”

“DP World has always heavily invested in state-of-the-art digital equipment and is continuously introducing innovations in terminal operations that boost resilience and automation, thereby allowing us to evolve and enhance the services we offer our customers. Indicatively, at DP World Limassol, we have introduced digital payment solutions, while this past February, we launched the new ZODIAC cloud-based Terminal Operating System (TOS). The migration into ZODIAC TOS was a big milestone for us at DP World Limassol,” he said.

“The new system helps us reduce maintenance costs and improve productivity, while it connects all supply chain participants through a single integrated platform, which provides real-time information on vessel, yard, gate and rail movements,” Charalambous added.

MSC Reports Results for 2019

MSC Cruises has reported a net income of 405 million euros on revenues of 3.2 billion euros for 2019, compared to net income of 348 million euros on revenues of 2.7 billion euros for 2018.

MSC also reported more than 2.7 million passengers, which it said was an increase of 16.2 per cent from the previous year. Occupancy was 112.3 per cent, up from 111.6 per cent in 2018. Cruise capacity was said to be up 14.4 per cent year-over-year.

Fuel expenses increased 24.1 per cent to 244 million euros from 196 million euros the year before, mainly driven by the additional capacity and price increases, according to MSC.

Interest expenses decreased to 121 million euros from 127 million euros.

Because of the COVID-19 outbreak, MSC said it has suspended all cruise departures for 45 days, until April 30.

Meanwhile, the company said it has put into place measures to preserve its cash position and referred to credit facilities and other sources of liquidity it may activate if needed, amounting to some 900 million euros, in addition to its current cash position of 183 million euros.

In addition, with ships in lay-up, operating costs are being reduced.

Furthermore, MSC stated it is collaborating with key providers and stakeholders to improve its working capital position and is pursuing additional actions by postponing capital expenditures for business initiatives planned in the coming 18 months.

MSC said that because of the circumstances it cannot provide guidance on its financial performance for the year 2020.

Royal Caribbean sells stake in Spanish and French cruise brands

Royal Caribbean sells stake in Spanish and French cruise brands

Royal Caribbean Cruises is selling part of its interest in its Spanish and French cruise operations for an undisclosed sum.

Madrid-based private equity firm Springwater is taking a 51% stake in Pullmantur and Croisières de France, leaving the US cruise giant with a 49% holding through a new joint venture.

Royal Caribbean will retain full ownership of the ships and aircraft currently operated by the two brands, which will be leased into the joint venture.

Chairman and chief executive, Richard Fain, said: "Pullmantur and CDF have a long history of offering authentic, localised cruise vacations to their home markets.

"We look forward to the new focus that this joint venture with Springwater will bring to these companies as they seek to grow."

He added: "Given the signs of recovery we have seen in the Spanish economy, as well as increased interest in cruising from tourists in France, we think this is the right time to bring together the extensive experience of our deeply valued employees at Pullmantur and CDF with the local travel and tourism expertise of the Springwater team.

“Springwater's local management presence in Madrid, coupled with RCL's long-standing history in cruise operations, will provide the foundation for improved returns in the future."

Opinion: Technology will change the rules by which the industry is run

Technology is going to continue to evolve at a frightening pace and the rules by which the industry has been run are about to change, warns Ken McLeod of Advantage Travel Centres

Every agent should have been in Dublin in October to listen to 600 airline and distribution chain representatives at Iata’s .

Sitting in the audience I realised the possibilities offered by Iata’s New Distribution Capability (NDC) are dwarfed by the challenges facing the industry as it undergoes a fundamental change to distribution, pricing and relationships.

The airline world has been evolving faster than ever.

Systems have been remarkably efficient, but as airlines become more complex and revenue management and yield ever more important, the process is becoming more difficult to control.

NDC was discussed in almost every session at the symposium. While we know change is on the way, the questions raised were what will it look like and how fundamental will it be?

Only in one of the final sessions did we hear GDS, agency, airline and corporate representatives agree that collaboration, transparency and value have to be at the heart of any change.

Diversity of opinion

The GDSs were well represented throughout and talked some sense, especially the fact that customers’ trips are not just only airline seats but also hotels, car rental and many other services.

The airlines are fixated on reducing the cost of distribution and raising more revenue through ancillary sales. However, you only have to consider some of the statements made over the three days to understand the diversity of opinion:

“Airlines have less control on pricing than almost any other industry.”

“NDC is a key component of change in revenue management.”

“It’s not about the price of the ticket. It’s about what passengers will pay in total for the travel experience.”

“There is a complete lack of trust between stakeholders on NDC.”

“The marketplace must determine solutions.”

“Who is paying for all this?”

NDC is only part of a creative and technological evolution that will impact an industry that has lived, until now, with margins of $2.50 per seat.

As one speaker pointed out: “Starbucks make that on every cup of coffee.”

No understanding at the top

It reminded me of something B&Q is experimenting with: trialling different pricing for the same products on different days of the week, with products more expensive at weekends and cheaper on quiet days.

This leads to a variety of pricing elements for loyal customers and allows the company to link offers such as two for one to certain clients.

Why is B&Q doing this now? The technology available makes it easy.

Technology is going to continue to evolve at a frightening pace. The rules by which the industry has been run are about to change.

On leaving Dublin, I had mixed feelings. On the one hand, a lot was achieved in understanding the challenges. But I couldn’t help thinking those at the top of the tree do not get the message.

My opinion is that travel management companies and agents are not ready for the change. It will happen soon, maybe gradually to begin with, but many will be taken by surprise.