Partners will explore two joint ventures to develop cruise ports and China's first-ever domestic cruise line
By
Rebecca Gibson |
Carnival Corporation & plc has signed a memorandum of understanding (MOU) with China Merchants Group (CMG) to explore the possibility of two joint ventures (JVs) designed to accelerate the growth of the cruise industry in China.
One of the JVs will explore the possibility of owning and operating China’s first-ever domestic cruise line, targeted specifically at the Chinese market. The partners will evaluate the feasibility of sourcing newbuilds that have been designed and built in China, as well as the possibility of acquiring existing cruise vessels.
As part of the second JV, Carnival and CMG aim to develop turnaround and transit ports in China. This will include a flagship port – Prince Bay Cruise Terminal – in Shekou, Shenzhen, which is currently being developed by CMG. The partners plan to deploy cruise ships from this port while they develop other cruise ship destinations across China and North Asia.
“The MOU we have signed signifies a great opportunity to take the next step in the future of Chinese cruising, while addressing some key needs for both the cruise industry and its passengers in China,” said Alan Buckelew, COO of Carnival Corporation. “With CMG’s amazing track record, reach and influence in the market, we are working with a strategic partner that can help us explore immediate ways to impact cruise growth in China, including the possibility of a new Chinese cruise brand and new destinations.”
Carnival Corporation and CMG formalised their strategic partnership during an event held on 26 January in Shenzhen. Several key figures attended the MOU signing including Yang Tian Ping, general manager of China Merchants Shekou Industrial Zone; Alan Buckelew, COO of Carnival Corporation; and Sun Cheng Ming, vice president of CMG.
The MOU also supports Carnival Corporation’s strategy to expand its capacity in Asia. Last year, the company announced that global COO Alan Buckelew is to relocate to China to expand his leadership role and oversee the company’s growing operations in the country.
In 2015, Carnival Corporation will become the first global cruise company with four ships based in China. In April, Costa Cruises’ Costa Serena will begin her year-round deployment in Shanghai, joining her sister ships Costa Victoria and Costa Atlantica. The move will increase Costa’s overall capacity in Asia by 74%, while Carnival Corporation’s total capacity is expected to rise 140% over a two-year period.
Meanwhile, the new partnership aims to support the Chinese Ministry of Transport’s (MOT) initiatives to transform China into a leading global cruise market and spur new economic development from tourism.
According to the MOT, China is expected to become the second largest global cruise market after the US in the next several years based on economic growth, the increased spending power of Chinese consumers and the growing demand for cruise vacations in the country. In addition, it is expected to be one of the world’s largest cruise markets with 4.5 million passengers by 2020.