Genting Hong Kong takes control of three  further European shipyards

Genting Hong Kong has announced the acquisition of Nordic Yards’ three shipyards in Wismar, Warnemunde and Stralsund, Germany for the consideration of €230.6 million.

The purchase of the three shipyards, along with Lloyd Werft last year, enables Genting Hong Kong to realize its global cruise ships fleet strategy over the next decade for its three brands – Crystal Cruises, Dream Cruises, and Star Cruises.

“The rapid growth of the world cruise industry, especially in China, has led to cruise ship order book reaching an all-time high,” said Tan Sri Lim Kok Thay, chairman, Genting Hong Kong.

“In order to ensure that the Company can build the required number of cruise ships in the next decade for our global fleet expansion, it is strategic that we acquired shipyards that can build our cruise ships in a timely basis and in a more cost effective manner.”

The newly acquired yards together with the previously purchased Lloyd Werft will be managed as the Lloyd Werft Group, optimizing the strengths of each of the yards for design and construction of cruise ships and megayachts.

Ownership of the shipyards will free the company from both the delivery timing and pricing uncertainties associated with the cruise ship order book cycle, which is at a historic high and allow management to focus on the strategic planning, design and deployment of its planned cruise ships among its three brands.

The three newly acquired shipyards are unique with covered dry-docks and building halls, resulting in high labour productivity and completion quality as cruise ships can be constructed regardless of weather conditions.

The Wismar shipyard’s dry-dock measures 340m long and 67m wide and the Warnemunde shipyard’s drydock measures 320m long and 54m wide and are capable of building cruise ships larger than the largest cruise ships currently afloat.

The Stralsund shipyard has a ship lift to launch cruise ships and megayachts up to 270m long.

These shipyards, with further investment, will have a steel fabrication capacity of about 150,000 tons a year, sufficient to build a number of cruise ships and a megayacht yearly.

“With all the yards situated in Germany, a country with a long tradition of efficiency in building high quality and innovative cruise ships and megayachts, the Lloyd Werft Group, with approximately 1,700 experienced management and workers, is well placed to succeed as one of the best cruise and megayacht shipbuilding companies in the world.

“Germany is also where the largest cluster of marine equipment suppliers are located and has excellent Government maritime coordination policies,” said Tan Sri Lim Kok Thay.

“The investment in the Lloyd Werft Group will have good returns from the 10 year planned order book, fits perfectly with the Company’s global cruise strategy and is in the long term interest of the company.”

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Crystal Cruises parent agrees to buy German shipyard

The parent company of Crystal Cruises has agreed to acquire leading shipyard Lloyd Werft in Bremerhaven, Germany.

Global cruise and resort company Genting Hong Kong is to pay €17.5 million for 70% of a new shipbuilding business and a 50% ownership of the shipyard’s land.

The company will complete the acquisition of Lloyd Werft subject to the fulfilment of certain final purchase conditions.

The move follows plans for massive expansion of Crystal Cruises with the introduction of Crystal Yacht Cruises in December, Crystal River Cruises and Crystal Luxury Air in 2017 and new cruise ships from late 2018.

Genting Hong Kong signed a letter of intent earlier this year with Lloyd Werft to build Crystal’s ‘Exclusive Class’ polar-class cruise ships.

Lloyd Werft will also build luxury river yachts to sail to destinations in France, Germany, Switzerland, Holland, Belgium, Austria, Slovakia, Hungary, Croatia, Serbia, Romania and Bulgaria.

Genting Hong Kong chairman and chief executive, Tan Sri Lim Kok Thay, said: “Lloyd Werft has built and lengthened six of the ships owned by an affiliate of the company and has the expertise to build a series of world class cruise ships for the company, which will include the ‘Exclusive Class’ vessels for Crystal Cruises.

“Ownership in Lloyd Werft will enable Genting Hong Kong to leverage on the shipyard’s technical expertise and their well-established and long track record in the shipbuilding industry.”

Crystal president and chief executive, Edie Rodriguez, said: “With such great anticipation for Crystal River Cruises and Crystal Exclusive Class ocean vessels, we are incredibly excited about Genting’s groundbreaking investment in the Lloyd Werft shipyard that will contribute mightily to Crystal Cruises’ expansion.”

Should river lines be worried about Crystal?


By Michelle Baran

Throughout the last several years of seemingly unstoppable growth in the river cruise market, ocean cruise lines have resisted getting in on the river action, a segment of the cruise market that, while clearly very popular, represents entirely different economics of scale (in other words, much lower passenger volumes) than ocean cruising.

So when Crystal Cruises announced a massive expansion initiative, including plans for two new river cruise vessels, it effectively became the first ocean line to cross into the river world.

Until the Crystal announcement, the only significant crossover in Europe had been in the opposite direction: river cruise heavyweight Viking Cruises launched its first ocean-going vessel this year (there are several smaller scale examples, such as Haimark, which has both river cruise vessels and a coastal cruise vessel, as well as the now-defunct Peter Deilmann Cruises and Cruise West, both of which dabbled in river and coastal cruising). And Crystal has been involved on the rivers before, via a marketing partnership with AmaWaterways.

Crystal hasn’t revealed much detail about the river cruise piece of its ocean-yacht-river-jet expansion plan. Lloyd Werft, the German shipyard that will construct Crystal’s new ocean ships, is also building two luxury, Crystal-branded river cruise vessels that will operate in Europe. (Crystal CEO Edie Rodriguez told Travel Weekly’s Tom Stieghorst that Crystal will reveal additional information about its river cruise product at a later date for competitive reasons.)

Looking at all of this, should river cruise lines be somewhat nervous? Could Crystal entering the river cruise business put a dent into the all the hard work they’ve put into creating, growing and developing the market these past years?

Well, Crystal still has to fit those plans into the same 38-by-410-foot dimensions that all river cruise vessels are limited to, due to the locks and bridges along Europe’s inland waterways. In that regard, Crystal will be up against the same innovation challenges the river lines have been grappling with through these growth years: how to maximize space and onboard offerings when square footage is so limited.

Additionally, for now at least, it’s only talking about two vessels, a tiny fraction of the overall river cruise inventory in Europe.

But under its new ownership of Genting Hong Kong, which clearly has ambitious plans for the company, Crystal could have enough resources at its fingertips to at least make some waves in the river cruise market, both from a hardware as well as from a marketing point of view.

“I think Crystal is doing a very smart thing,” said Donald Baasch of American Canyon, Calif.-based LastCallCruises. “They might as well make money on their customers instead of letting someone else have them, especially if they believe that a lot of them will inevitably want to try a river cruise.”

So, all told, surely the highly competitive river cruise industry has its eye on Crystal’s plans, but I doubt they are shaking in their boots quite yet.