In a signal that cruising has finally recovered, Carnival Corp. has inked its first order for a new ship since before the pandemic. The fourth Excel-Class ship for Carnival Cruise Line will be built at the Meyer Werft shipyard and be delivered in 2027.
And the company confirmed rumors reported in Seatrade Cruise News they are in discussion for as many as four ships to be built by Fincantieri in Italy.
Carnival Corp. had traditionally contracted for ships financed by cash flow. But it rolled up more than $30-billion in debt in the lockdowns and recovery from the pandemic. Now the family of cruise lines is reporting record bookings and revenues for 2024 and beyond and it’s going to need to build more capacity.
“Building on our strong performance and growing momentum around the world, we are excited to resume our newbuild program and work to further enhance our global fleet with yet another state-of-the-art Meyer Werft ship that will wow Carnival Cruise Line’s guests,” said Josh Weinstein, CEO of Carnival Corp.
The new order for Carnival is going to be a sister of Carnival Jubilee, launched in 2023 and will have a capacity of up to 6,400 guests. The only other pre-pandemic orders still to be delivered ordered are Sun Princess, arriving at the end of February and Cunard Line’s Queen Anne, launching in April.
A final Princess ship, Star Princess is being built by Fincantieri for delivery in 2025. There won’t be any new ship christened by any of the Carnival Corp. lines in 2026.
Carnival wasn’t alone in pulling the plug due to the long lockdown. Royal Caribbean has two sisters of its recently lanched giant Icon of the Seas being built, and both of them were ordered in 2019. But it’s also just announced that its ordering a seventh Oasis Class ship to follow the Utopia of the Seas. The order with French shipbuilder Chantiers de ‘Atlantique won’t arrive until 2028.
Celebrity Cruises is building a final addition to its Edge Class, to be named Celebrity Xcel that’s due to be launched 2025, but it was planned before the pandemic. Norwegian Cruise Line Holdings’ newly launched ships for Regent Seven Seas and Oceania Cruises were also on order before the lockdown.
Another sign of recovery was MSC Group’s confirmation of an order for the final two of six ships being built for its Explora Journeys fleet.
“This order is a clear sign that the cruise market has recovered and that there is great demand for sea voyages,” Thomas Weigend, chief sales officer of Meyer Group told Seatrade Cruise News. Since 2018, Meyer Werft and Meyer Turku have built nine cruise ships with LNG propulsion on a joint technical platform for four cruise lines in the Carnival Corp. portfolio.
Despite the optimism, Carnival signaled a continued focus on the bottom line.
“With one newbuild scheduled for delivery in 2025, none for 2026, and this order being our only expected newbuild in 2027, our responsible capital approach will support utilizing our substantial free cash flow over the next several years to strategically improve our balance sheet, significantly reduce our leverage levels and continue to transfer value from debt holders to shareholders,” Weinstein commented.
“We also remain focused on driving revenue growth throughout our portfolio of world-class cruise lines by continuing to improve execution across all aspects of our operation, yielding higher return on invested capital.”
Story by Wallace Immen, The Cruisington Times
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