Growing the global cruise fleet

The cruise industry order book now stretches a record 10 years ahead with major newbuild deliveries scheduled up to 2026. David Mott reports

Growing the global cruise fleet
Norwegian Joy is due to debut in China in summer 2017
This article was first published in the Autumn/Winter 2016 issue of International Cruise & Ferry Review. All information was correct at the time of printing, but may since have changed.

The bullish tone of the cruise ship building market continues to grow rapidly in the wake of the global recession. In the past few months alone, major operators have placed orders for a potential seven new cruise vessels of more than 200,000gt and 5,000 berths each.

Shipowners are also jockeying for further building slots well into the future, agreeing to options for repeat ships to cover them. Most options will ultimately be converted to firm orders. The result of all this is that the industry order book now stretches an unprecedented 10 years ahead with deliveries up to 2026.

Privately owned MSC Cruises paved the way, advancing its ambition to be one of the world’s leading cruise lines by ordering two 5,400-berth LNG ships of more than 200,000gt – with an option for two more – from STX France in Saint-Nazaire. To be designed in collaboration with STX France, MSC Cruises’ World Class vessels will be delivered between 2002 and 2026. The total contract is worth more than US$4 billion. “This takes our 10-year investment plan up to 11 new ships entering service between next year and 2026,” said Pierfrancesco Vago, the line’s executive chairman.

This May, there was mild surprise when Royal Caribbean Cruises Ltd. (RCL) booked a fifth ship for Royal Caribbean International’s Oasis-class series. The vessels, which weigh 220,000gt and accommodate 5,500 passengers, are the largest in the world and cost up to US$1.5 billion each. To be built by STX France and delivered in 2018, the newbuild was ordered after what chairman Richard Fain described as a ‘staggering response on both sides of the Atlantic’ to the third Oasis-class ship, Harmony of the Seas, when she entered service in May.

At the same time, RCL ordered two Edge-class ships, each with 2,900 berths, for its Celebrity Cruises brand. The vessels will be delivered in 2021 and 2022, joining Celebrity’s first two Edge-class vessels, which will debut in 2018 and 2020.

Genting Hong Kong finalised an order for two of its cruise brands with its newly formed Lloyd Werft Group, a collection of four shipyards it recently acquired in Northern Germany. The order covers eight ships for Crystal Cruises, including a 117,000gt Exclusive Class vessel, mega yacht Crystal Endeavor and six river cruise vessels. The company has also contracted the yard to build two 201,000gt Global-class vessels, each with 5,000 berths, for Asia-based brand Star Cruises. Genting chairman Tan Sri Lim Kok said the latest Star Cruises orders and two earlier global vessels, which will all feature interiors tailored to Chinese travellers, will enter the market between 2019 and 2020 at a rate of one ship a year, rising to two. He believes the Lloyd Werft yard – best known for repairs and conversions – and its three smaller subsidiary builders in North Germany, have the ability to produce up to two mega ships and one mid-size 50,000gt vessel every year.

Meanwhile, Carnival Corporation & plc chairman Micky Arison used the official handover ceremony for Holland America Line’s (HAL) Koningsdam this April to formalise the corporation’s order for five new LNG cruise ships to be built by Fincantieri as part of a nine-ship deal announced in 2015. Two of the ships will sail for Princess Cruises, one for P&O Cruises Australia and two for Costa Asia, which will sail in China. Deliveries are expected in 2019 and 2020.

“The ability to power ships both in port and at sea with LNG, the world’s cleanest burning fossil fuel, is a historic (cruise) industry first when it comes to innovation,” Bo-Erik Blomqvist, Carnival Corporation’s head of shipbuilding, told ICFR. “LNG providing 100% of a ship’s power will enable significant reduction in exhaust emissions.”

Named by Queen Máxima of the Netherlands on 20 May, Koningsdam is the first of HAL’s 100,000gt Pinnacle Class ships. A second, named Nieuw Statendam, is due in 2018.

On an altogether smaller scale, Norwegian adventure cruise and ferry operator Hurtigruten made its largest investment to date when it placed a firm order for two ice-class explorer vessels destined for the polar regions this April. The 600-passenger ships will be built by Norwegian yard Kleven Werft, and will potentially be joined by two additional sister ships at a later date.

Several major brands have welcomed long-awaited cruise ships this year.

Carnival Cruise Line’s Carnival Vista arrived in the market this May to a ‘frisson of excitement’, according to the line’s president Christine Duffy. Surprisingly Carnival’s first newbuild for four years, the 13,500gt, 4,000-guest Carnival Vista is the line’s 25th and largest vessel to date. A second US$700 million Vista-class vessel named Carnival Horizon is to be delivered by Fincantieri in 2018.

AIDA Cruises’ much-delayed AIDAprima was named in Hamburg, Germany in May after being delivered by Japan’s Mitsubishi Heavy Industries yard. In 2020, the yard is to complete AIDAperla, a 3,300-guest sister ship, taking AIDA’s fleet to 14 vessels. However, the Mitsubishi yard, which was the only non-European yard building dual-fuel cruise ships, has sustained heavy financial losses while building the two ships, which are valued at a total of US$650 million. It is now unlikely to take any more orders for cruise ships and the orders for two even larger LNG ships have gone to Meyer Werft, AIDA’s traditional builder, as part of its parent company Carnival Corporation’s nine-ship package.

Regent Seven Seas Cruises’ (RSSC) latest ship, Seven Seas Explorer, was a long time coming, but is expected to drive revenue immediately now that she has been christened and started service in Europe. “There has been an extraordinary demand for the new ship, reinforcing the decision to expand the fleet,” said Jason Montague, the line’s president and CEO. Italian shipyard Fincantieri will build a 750-berth sister ship worth in excess of US$500 million, while RSSC’s three existing ships – Seven Seas Voyager, Seven Seas Navigator and Seven Seas Mariner – are also undergoing extensive upgrades.

Also in May, Viking Ocean Cruises christened the 47,800gt Viking Sea, the second of six 930-passenger ships on order. Viking Sea was the largest ship to be named in the port of London on the River Thames. CEO Torstein Hagen, said there was also interest in the fourth ship, Viking Sun, which will spend her maiden season on a major world cruise.

Meanwhile, German operator TUI Cruises took delivery of its latest ship, Mein Schiff 5, from Meyer Turku in Finland, 10 days ahead of schedule. The vessel was officially christened by German singer and songwriter Lena Meyer-Landrut in Lübeck-Travemünde, Germany on 15 July.

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David Mott
By David Mott
Tuesday, September 20, 2016