CBR Odo Commentary – Opening of Cuba to US cruising could have far reaching implications

The opening of Cuba for cruise passengers from the US could have far reaching consequences for the cruise industry in the region.

On Wednesday, the US and Cuba agreed to restore diplomatic ties for the first time since 1961 and the US agreed to ease travel restrictions between the two countries. However, it was not immediately known what this would mean in practice.

We think the cruise industry would be a major beneficiary from lifting of all travel restrictions currently imposed by the US government on its citizens.

Cuba’s tourism infrastructure would be unlikely to be able to cope with an influx of large numbers of Americans wishing to visit the country. Cruise ships would be able to overcome this be offering itineraries with overnight stays; Cuba is located only some 90 miles south of Florida, which would allow this on even short duration itineraries.

Cuba is virtually the only island in the Caribbean that can offer city destinations to visiting tourists, which could broaden the appeal of the region.

The introduction of Scandinavian style cruise ferries that carry passengers in good quality accommodations and their vehicles plus roro freight, could also be on the cards.

It is possible that the availability of berthing facilties in major locations, such as Havana, could pose some problems to cruise lines should the demand for cruises thsat visit Cuba reach a high level in a short period of time, which we think could be the case.

The opening of Cuba would, quite likely, have a negative impact of cruise tourism in the Bahamas as many lines would probably replace Nassau with Havana on their itineraries.

US, Cuba restore diplomatic ties, travel restrictions eased, cruise shipping shares gain

The US and Cuba have agreed to restore diplomatic ties, which sent shares in listed cruise shipping groups sharply higher. However, it is not yet known what promised easing of travel restrictions would mean in practice.

The United States and Cuba agreed on Wednesday to restore diplomatic ties that Washington severed more than 50 years ago, and President Barack Obama called for an end to the long economic embargo against its old Cold War enemy, the Reuters news agency reported yesterday.

“Travel restrictions that make it hard for most Americans to visit will be eased, but the door will not yet be open for broad U.S. tourism on the Caribbean island,” Reuters said.

“Obama's announcement also will not end the U.S. trade embargo that has been in force for more than 50 years. That is codified in legislation and needs congressional approval. Obama said he would seek that approval but likely faces a struggle,” the news agency stated.

However, it was not immediately clear what the warming of relations between the two countries that are separated only by 90 miles of sea would mean in practice.

Shares in listed cruise shipping companies, however, rose sharply on the news. Norwegian Cruise Line Holdings gained 4.57% to close at $45.76, Carnival Corp rose 3.46% to $44.61 in New York, while Carnival plc in London firmed 1.1% to finish trading at £28.01. Royal Caribbean Cruises Ltd (RCCL) rallied 6.62% to $81.54 and 0.7% to NOK585.0 in Oslo. The news came late in the day in Europe, which explains the smaller gains in European listed shares than those quoted in the US.

Christine Duffy named President of Carnival Cruise Lines

Carnival Corporation & plc., the world's largest travel and leisure company, today announced that Christine Duffy has been named president of Carnival Cruise Lines, with 24 ships, making it the largest of Carnival Corporation's nine distinct cruise brands.

Duffy, currently president and CEO of Cruise Lines International Association (CLIA), will assume the role on Feb. 1, reporting to Arnold Donald, CEO of Carnival Corporation & plc.

"Christine is one of the most respected and dynamic leaders in the travel industry," said Donald. "She brings a wealth of experience to Carnival Cruise Line that will help the cruise line continue to deliver unmatched vacation experiences to millions of guests each year."

Duffy has more than 30 years of experience in the travel industry and started her career as a travel agent in Philadelphia at McGettigan Partners. As CEO of CLIA, the leading trade association of the cruise industry, she led many advancements including the globalization of cruise industry associations around the world to create a unified voice promoting cruising to key stakeholders from policy makers to consumers through CLIA's more than 13,000 travel agency members representing over 50,000 travel agents.

In this role, Duffy successfully engaged member cruise lines and industry stakeholders to support CLIA's expansion into new and emerging markets around the world. Before assuming her role with CLIA in 2010, she served as president and CEO of Maritz Travel, the largest corporate meeting, incentive and event companies in the world from 2004-2010.

"This is a tremendous opportunity for me to be part of a dynamic organization with a long history of innovation and industry firsts," said Duffy. "The name Carnival is truly synonymous with cruising and I look forward to joining this talented team to continue the tradition of excellence that has made Carnival Cruise Line one of the top cruise lines in the world."

Duffy serves on various travel industry boards including U.S. Travel Association (USTA), the advisory board for Starwood Hotels, and the Board of Directors for Visit Florida.  In 2001, she founded Meeting Professionals International's Women's Leadership Initiative, which delivered research and programs to help women in the industry advance in their careers. She also is a member of The Committee of 200, an organization of the world's most successful women business leaders that supports, celebrates and advances women's leadership in business and works to ensure that women will continue to take on more significant and visible leadership roles.  

The St. Louis Business Journal recognized her as one of the 25 Most Influential Business Women. Corporate Meetings and Incentives chose her as one of the "Top 10 Women Leaders in the Meeting Industry," and Meetings News magazine named her four separate times as one of the "25 Most Influential People in the Meetings Industry."

RCCL enters partnership deal with Ctrip’s rival

After finalising its partnership deal with Ctrip, Royal Caribbean Cruises Ltd. (RCCL) has entered an exclusive cooperation agreement with another Chinese online distributor, JD.com. Alan Lam reports.

 

Meanwhile JD.com or Jingdong (), a NASDAQ-listed, Beijing-headquartered Chinese electronic commercial company, one of the largest B2C online retailers in China, has also signed a cooperation agreement with the NASDAQ-listed Tuniu Corp. (tuniu.com), a Chinese online travel agency, a rival of Ctrip, to jointly develop cruise business

 

JD.com launched its cruise travel service, Jingdong Cruise, in June 2014.

 

While the deal with Ctrip is to operate Celebrity Century, RCCL’s agreement with JD.com has been based on operating another Celebrity Cruises ship, Celebrity Millennium, which will be undertaking four cruises from Shanghai to Hong Kong, Japan and South Korea in the coming season. The marketing operation has already started in earnest.

 

This latest development is another suggestion that China’s cruise sales network is maturing and expanding fast. It may soon be a world leader, if not already, in online cruise product distribution. RCCL may be in the enviable position to reap the benefit. The group is certainly ahead of its peers in penetrating the Chinese market.

 

China is already a world leader in online retail sales.

 

Updated: Engine room fire on Insignia brought under control - report

One crew member and two contractors were killed after an engine room fire onboard Oceania Cruises' Insignia, the line has confirmed to Cruise Critic. 

"Three crew members and two contractors who were working onboard were transferred to a local medical facility. We are deeply saddened to learn that two contractors and one crew member did not survive. We extend our deepest condolences to their families during this very difficult time," the company was quoted as saying.

Also according to Oceania, the fire was contained to the engine room and all passengers are safe and have disembarked.

"Arrangements are being made for guests and crew to be accommodated at local hotels until transportation to Miami is arranged," the line said. A Guest and Crew Support team, along with a technical team, is en route from Miami to St. Lucia.

Insignia was on a 10-night cruise, which departed San Juan on December 7 and was scheduled to arrive in Miami on December 17, the report said.

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A fire that broke out in the engine room of Oceania Cruises' 30,000 gross ton Insignia at about 0930am local time, when the ship was docked at Castries in St Lucia, has been brought under control, a report on Cruise Critic said.

"According to St. Lucia News Online, fire officials in Port Castries received a call at 9:25 a.m. that a fire had broken out in the ship's engine room. The St. Lucia Air and Sea Ports Authority and the St. Lucia Fire Service told the news site the situation is under control, and confirmed that three people have been hospitalized, one for smoke inhalation and mild respiratory distress. Fire officials said the incident was contained within Berth 5 at Port Castries," the report said.

A member of Cruise Critic said that all passengers had been called to muster stations and disembarked from the vessel.

Oceania Cruises is part of Prestige Cruise Holdings, which was acquired earlier this year by Norwegian Cruise Line Holdings Ltd. Insignia was built in France in 1998 as R One for the now defunct Renaissance Cruises. Oceania acquired the ship in 2004.

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