The Freedom of Cruise Ship Redeployment

The Freedom of Cruise Ship Redeployment
PHOTO: The wake behind Carnival Cruise Line’s Carnival Vista. (photo by Mark Leppert)

When it was uncertain that Cuba would remain open to roundtrip cruises from the United States, it was never a worry that the ships on the route would be incapable of redeployment.

Executives like Frank Del Rio, president and chief executive officer for Norwegian Cruise Line Holdings Ltd., repeat that in troubled times, cruise ships can go anywhere.

It’s true. A ship originally slated for the Caribbean can easily end up in Alaska or Europe seasonally, but often that’s the plan all along.

What may not be anticipated are geopolitical tensions or fears of terrorism that warrant ships go elsewhere. The latter has been the reason cruise lines have shied away from Turkey in the Mediterranean, for example.

More recently, cruise itineraries from China have stayed clear of South Korea due to heated relations between the two countries.

It was looking for awhile like the Trump administration would cease permissions for cruises to Cuba, but thankfully Norwegian Cruise Line and Royal Caribbean International were allowed to continue and Carnival Cruise Line has since been able to make its inaugural run as well.

If not, the Norwegian Sky, Empress of the Seas and Carnival Paradise, respectively, would just have had to cruise to lands beyond, likely still in the Caribbean.


Photo Credit Dave Jones~Norwegian Sky leaving Miami

In the Caribbean and the Mediterranean, there are plenty of alternative ports to go to when some become off limits, but such is not always the case. For the Chinese cruise market, the loss of South Korea as a destination has limited where local ships can head, particularly on itineraries with short durations.

In those cases, Japan is an option, but port capacity saturation is then a concern.

Once a booming market, cruise lines may have to rethink their long-term Chinese potential. Princess Cruises’ Majestic Princess—partially for this reason, as well as consideration of other growth markets—has opted to no longer dedicate itself to China year-round as originally planned. It also now has intentions for Australia-based cruising in 2018 and 2019.

When a cruise ship is built generically for any market, it is easy to deploy anywhere in the world, but when it is purpose-built like the Majestic, it is more challenging to take away.

Whether or not the ship will see any sort of redesign prior to its Australian deployment is still to be determined.

Still, the vast majority of cruise ships are geared towards the American market and can go pretty much anywhere in the world, catering to our sensibilities just fine.

As ships have aged out of their original brands, they have often gone on to later service international clients for different companies. However, now foreign markets are demanding new-builds as much as the American one, leaving older ships somewhat in limbo.

It’s easiest for the most popular fleets to deploy wherever they need to and still have a following, but mature vessels have a harder time of either competing in high-traffic regions or being handed down to other markets.

That’s why it’s always crucial for the cruise industry to be developing new port and destination options for the wide variety of international vessels to service. As long as they exist, there are plenty of places to go around for them all.

Having movable assets is a freedom that most shoreside industries don’t have. Even with its occasional challenges, including tracking complex global conditions, the international cruise fleet has it good compared to, say, a fixed retail shop with poor sales in a failing regional neighborhood.

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Norwegian Cruise Line’s first ship for China christened

Image result for Norwegian Joy Christening

Norwegian Cruise Line’s first ship purpose built for Chinese passengers was officially named in Shanghai yesterday.

The 3,883-passenger Norwegian Joy is the first cruise ship to feature a two-level go-kart track.

Other elements of the ship include an open-air laser tag course, the Galaxy Pavilion featuring simulator rides, Oculus virtual reality technology, interactive video walls and two multi-story waterslides.

Norwegian Joy has 28 dining options ranging from traditional Chinese cuisine to French, Italian and steakhouse fine dining restaurants, an open space park, as well as the line’s largest shopping area.

The christening marked the end of a month-long grand inaugural tour where the 167,725–gross-ton ship was showcased in Singapore, Qingdao, Shenzhen and Hong Kong, as well as VIP partner cruises from Norwegian Joy’s homeports of Shanghai and Tianjin.

Norwegian Cruise Line Holdings president and chief executive Frank Del Rio said: “After years spent carefully designing this amazing vessel, my team and I are both proud and thrilled to finally christen the world’s first cruise ship custom-designed for the wonderful people of China.

“This is truly a special moment for the entire Norwegian Cruise Line Holdings family, our valued travel partners, honoured guests and dedicated officers and crew across our fleet.”

The naming ceremony featured a performance by the ship’s godfather, Chinese singer songwriter, music producer, actor and film director, Wang Leehom.

China’s ban leaves cruise lines scrambling

Image result for Majestic Princess
Majestic Princess

Cruise lines have started to tear up their northern China itineraries following an order from the Chinese government to the country’s travel agencies to stop selling itineraries that include South Korea.

The Chinese directive follows the announcement late last month by the South Korean and U.S. governments that components for a new U.S.-developed anti-missile system were to arrive in South Korea last week for installation.

Known as the Terminal High Altitude Area Defense system, it is designed to intercept missiles up to 125 miles away as a means of protecting South Korea from missile strikes by North Korea, which has undertaken a series of long-range missile tests in recent months and tested a nuclear weapon as recently as last September.

The Chinese and Russian governments have objected to the installation of the missile-defense system because it employs powerful radar technology that the two countries assert can see into their territories.

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Genting Dream

Japan and South Korea are the main cruise destinations reachable from northern China on the four- and five-day itineraries preferred by most Chinese. With Korea suddenly off limits, cruises operated for Chinese passengers out of ports such as Tianjin and Shanghai will now focus primarily on visiting Japan, experts said.

In a statement, Costa Cruises said it would “remove calls to South Korean ports for our upcoming cruises homeported out of China, replacing them with cruising at sea or calls to destinations in Japan.”

Royal Caribbean International also said it will curtail visits to South Korean ports due to “recent developments regarding the situation in South Korea.”

Delivery of the parts for the missile-defense system came as North Korea tested four missiles launched in the direction of Japan that fell into the sea.

Dwain Wall, an executive at CruisingStore.com and a consultant familiar with the Chinese market, said there is no question that the Chinese government has the authority to order Chinese travel companies to stop selling cruises to Korea.

“There is a very tight licensing and regulatory control over travel agencies” in China, Wall said. “It does impact cruise, but it’s low season, thank God, and [the cruise lines have] been sort of able to regroup and change the ports to Japanese ports.”

If China’s ban persists into the busier summer months it could both overwhelm the port capacity in Japan and reduce demand for cruises in China because of the lack of destination variety.

Image result for ovation of the seas

Richard Fain, chairman of Royal Caribbean Cruises Ltd., said he could not predict how long the chill in China-Korea relations might last.

Stock analysts blamed news of the Korea tiff for a pull-back in cruise shares last week but said that it was excessive.

As a share of cruise lines’ global capacity, the analysts said China accounts for 9% of RCCL’s, 6% of Carnival Corp.’s and 4% to 5% of Norwegian Cruise Line Holdings’. Further, they pointed out, not all of that capacity is sailing from north China.