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Carnival and CSSC explore cruise ship building in China

Carnival Corporation & plc, the world's largest cruise company, announced it has signed a memorandum of understanding (MOU) with the China State Shipbuilding Corporation (CSSC) to explore the possibility of a joint venture aimed at accelerating the development and growth of the Chinese cruise industry, expected to be one of the largest cruise markets in the world with 4.5 million passengers by 2020, according to the Chinese Ministry of Transport (MOT), the company said in a statement.

"Becoming official at a signing ceremony today at the Ninth China Cruise Shipping and International Cruise Expo in Tianjin, the MOU outlines the framework for exploration of a partnership between Carnival Corporation and the CSSC that includes the possibility of forming a shipbuilding joint venture that could become a three-way arrangement involving Fincantieri of Italy, the world's largest cruise ship building company, in support of the Chinese government's plans to grow the cruising industry in China and meet escalating demand for cruises from Chinese travelers," Carnival said

As part of the possible shipbuilding joint venture, Carnival Corporation & plc would work closely with CSSC and Fincantieri to help define the first-ever, world-class cruise ship built in China. "Under the joint venture concept, Carnival Corporation would provide its ship design and shipbuilding expertise to create the vision, definition and overall specifications for the China-built cruise ship," the Anglo-American cruise shipping group said.

"This is really a breakthrough day for all of us at Carnival, as well as our friends at the CSSC and all Chinese travelers who are increasingly turning to cruises for their vacation experiences," said Arnold Donald, CEO of Carnival Corporation. "This landmark agreement enables us to work closely with our partners at the CSSC to fully explore the possibility of forming a joint venture to further develop China into a leading cruise market, supporting local economic development and bringing vacation enjoyment to millions. We look forward to getting to work and lending the expertise of many talented people across Carnival Corporation."

In the past year, the Chinese Ministry of Transport has expressed its strong desire to transform China into a leading global cruise market, including investments in infrastructure and developing a strong domestic cruise presence to help spur growth in cruising as a key component of the expanding tourism industry in China.

The MOT projects China to be the second largest global cruise market after the U.S. in the next several years based on economic growth, increased spending power of Chinese consumers and growing demand for cruise vacations in China. Partnerships like the relationship being fully explored between CSSC and Carnival support the MOT's pro-growth cruise policies designed to spur new economic development from tourism in China.

UPDATED: Brittany Ferries reported to abandon newbuilding, LNG retrofit programme

Update: A spokeswoman for Brittany Ferries has confirmed the reported cancellation of a newbuilding and also the cancellation of plans to convert six existing vessels for LNG propulsion and the use of scrubbers instead.

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Brittany Ferries, the French company that operates in the Western Channel, is reported to have abandoned plans to build a 61,000 gross ton LNG fuelled cruise ferry and to plans to retrofit LNG propulsion on six of its ships, BBC reports on its website.

It has not been possible for Cruise Business Online to obtain a comment from the company at this moment.

The retrofit programme would have cost £320 million. Instead, Brittany Ferries will install scrubbers on board the ships to allow it to meet the new emission control rules that will take effect from the beginning of next year.

In January, Brittany Ferries signed an initial contract with STX France to build a LNG driven 61,000 gross ton cruise ferry that would have been 210 metres in length and carried 2,600 passengers plus 650 cars and 40 lorries. It would have been due foe delivery in early 2016.

Drew Madsen appointed Norwegian Cruise Line president and COO

Norwegian Cruise Line Holdings Ltd., the Miasmi based listed cruise shipping group that recenty acquired Prestige Cruise Holdings, said hospitality veteran Drew Madsen has been appinted as president and chief operating officer (COO) of Norwegian Cruise Line, the group's contemporary market unit. "Madsen brings a strong track record of success to Norwegian with more than 30 years of leadership experience in the hospitality and consumer products industry, most recently as president and chief operating officer at Darden Restaurants, Inc., the world’s largest full-service restaurant company," Norwegian said in a statement. “Having delivered exceptional results during his tenure at Darden, Drew has a wealth of experience to draw upon as he joins Norwegian,” said Kevin Sheehan, president and chief executive officer of Norwegian Cruise Line Holdings Ltd. “We are at an exciting point in our company’s history. With the upcoming acquisition of Prestige Cruises International, Inc., it is the opportune time to add such a talented individual to our already diversified leadership team to focus on the core day-to-day business. I am confident in Drew as a results-oriented, highly collaborative and thoughtful leader who will continue to propel Norwegian on our positive growth trajectory.” Madsen played an instrumental role in establishing Darden as the most successful multi-brand operator in the full-service restaurant industry, increasing sales from $4.8 billion to $8.6 billion, while delivering a cumulative total shareholder return of 110% that significantly exceeded the S&P 500 by more than 47%. He also had the distinction of having Darden recognized as one of Fortune’s “100 Best Companies to Work For” – a first for the food service industry that was repeated for three consecutive years. Prior to Darden, Drew held leadership and marketing positions at James River Corporation and General Mills, among others. Throughout his career, he has consistently demonstrated an ability to produce results that led to improved operating margins, increased guest satisfaction, superior market penetration and an enhanced level of employee fulfillment. “I am thrilled to be starting the next chapter of my career at Norwegian Cruise Line,” said Madsen. “I am looking forward to ensuring that Norwegian excels in every facet of operation and that we continue to produce industry leading financial results, while also bringing new ideas and ways of doing business that improve guest satisfaction and team member involvement.” Madsen holds a master of business administration with distinction from the University of Michigan and a bachelor’s degree in economics from DePauw University.

Carnival Corporation sees 24% improvement in fuel efficiency from 2007 through 2014

Carnival Corporation & plc, the world’s largest cruise company, today released the results of its multi-year Fleet Fuel Conservation Program that by the end of 2014 will have saved more than one billion gallons of fuel and reduced fleet carbon emissions by 12 billion kilograms over a seven year period.

By the end of 2014, Carnival Corporation’s Fleet Fuel Conservation Program will have improved the fleet’s overall fuel efficiency by 24 percent compared to 2007, while saving approximately $2.5 billion in fuel costs, the company’s single biggest expense. Carnival Corporation announced the results of its fuel conservation efforts in conjunction with a National Press Club event celebrating world tourism today in Washington, D.C.

Carnival Corporation’s Fleet Fuel Conservation Program combines energy-saving programs onboard current ships with new energy-efficient ship designs to reduce energy consumption and boost fuel efficiency across its fleet of over 100 ships. The program has become a cornerstone of the corporation’s strategy to collaborate across its nine industry-leading brands and leverage its scale, while supporting sustainability initiatives designed to reduce environmental impact from maritime operations.

Since cruise ships generate their own electricity from fuel, Carnival set out to uncover every feasible way to reduce onboard energy usage and launched several key conservation initiatives since 2007 that have driven the success of the Fleet Fuel Conservation Program. These efforts include:

–         Propulsion: Improving how the ship moves through the water by optimizing ship speeds and cruise distances to design more fuel-efficient itineraries, significantly reducing energy and fuel consumption.

–         Hull coatings: Using new hull coatings and cleaning technologies to minimize the growth of marine organisms that create drag on the hull, which reduces the amount of fuel needed to move the ship through water.

–         Air conditioning: Installing new, energy-efficient A/C systems to help reduce the energy used to cool the ships, which is the second largest consumer of onboard energy after propulsion.

–         Lighting: Replacing traditional lighting with more efficient LED bulbs is an ongoing opportunity to save energy, as the company continues the process of replacing four million lights across the fleet.

–         Water production: While producing 73 percent of water used onboard its ships, Carnival is reducing the rate of onboard water usage and finding more efficient ways to produce water, including better use of engine heat to convert sea water to fresh water and installation of reverse osmosis systems.

–         Education & Training: Increasing onboard energy use awareness among officers, crew and guests.

–         Other initiatives: The company is pursuing additional energy-saving ideas for engine room cooling equipment, audio and entertainment systems, galley/cooking appliances and laundry services, and expanding the 20 percent of ships equipped for “cold ironing” as more ports offer the ability to connect to shore electrical power. Carnival also continues to develop its ability to use alternative fuels.

New ship builds also drive significant improvements in fleet fuel efficiency through energy-saving innovations that are designed directly into the new vessels. By adding over 30 new ships to its fleet since 2007, Carnival Corporation has capitalized on the latest advances in energy efficiency, including building larger ships with highly efficient propulsion systems that incorporate new computer-modeled hull designs and the latest in fuel-efficient propeller and engine combinations.

“We have made great strides in working together to reduce energy and fuel consumption across our fleet, which is a top priority for us as a company,” said Arnold Donald, CEO of Carnival Corporation. “We are very proud of our conservation efforts, but we also realize that doing our part to reduce carbon emissions and help protect the environment is a job that is never complete. We’re committed to building on the momentum of our sustainability initiatives because it is the right thing to do for the environment and our fellow citizens, the passengers and crew on our ships, the communities we visit, and also for our business.”

Expanding Environmental Efforts Across Nine Global Cruise Brands

Carnival Corporation’s Fleet Fuel Conservation Program is part of its deep-rooted commitment to protect the natural environments in which it operates, while also reducing emissions from its ships and improving air quality. The company’s more than 100,000 employees drive this commitment to preserve the oceans and seas that provide livelihoods and enjoyment for millions of people around the world.

Fuel conservation is Carnival’s top environmental priority and the company is expected to increase fuel efficiency by five percent in 2014 alone. Driven largely by its energy and fuel conservation efforts, Carnival is now in a position to exceed its goal of a 20 percent reduction in carbon emissions by 2015.

Carnival Corporation is investing as much as $400 million to design, build and install an industry-first exhaust gas cleaning technology, called ECO-EGC™, to more than 70 percent of its fleet. The system uses filters and seawater to remove pollutants from exhaust gases, significantly advancing cleaner air quality for oceangoing vessels.

In addition to these efforts, the company continues to focus on additional environmental initiatives, including using effective waste management, employing on-board environmental officers on every ship and partnering with environmental organizations such as The Nature Conservancy to support protection of the global marine environment.

These efforts by Carnival Corporation paired with efforts from other parties in the maritime industry have had an impact on environmental preservation. According to the Secretary General of the International Chamber of Shipping, there has been a 20 percent reduction in greenhouse gas emissions for the entire global maritime transportation industry from 2007 to 2012. Carnival is also a member of the Sustainable Shipping Initiative whose main goal is to promote sustainability within the global maritime industry.

“The Three Cs”: Strategic Initiative to Leverage Carnival Corporation’s Industry-leading Scale

The Fleet Fuel Conservation Program has served as a model for Carnival Corporation’s strategy to work closely together across its nine brands through collaboration, cooperation and communication – known internally as “the Three Cs” – to improve guest experiences, strengthen brands, boost operational efficiency, reduce expenses and generate new sources of revenue.

Throughout 2014, Carnival Corporation has accelerated this collaborative approach to better leverage its scale as the world’s largest cruise company. The company’s extensive working-together program across its brands is designed over the longer term to generate significant cost-savings and revenue while improving quality and providing vacations that consistently exceed guest expectations. This effort embodies and helps actualize the sustainability values embedded in Carnival Corporation’s Health, Environment, Safety and Security Policy. 

Saga reports strong improvement in cruise sector

Saga, the British lifestyle company that focuses on customers over the age of 50, has reported a strong improvement in the profitability of its two ship cruise operations in six months to July, year on.

Revenue rose to £43.3 million from £38.1 million in the same period last year, while gross profit increased to £8.6 million from £4.5 million. Operating margin improved to 5.2% from 1.6%.

“Total passenger days in the Cruising business were up 13,000 (8.1%) through improved load factors on both of Saga's ships.  Together with improved per diem yields and higher on-board revenues, this resulted in a £5.2 million (13.6%) increase in revenue from the Cruising business,” the company said in a statement.

“In the Cruising business, we have extended the Saga brand into Third Party Cruising, through agreements with four separate cruise lines. Initial demand for this product has been strong and, encouragingly, 30% of the demand has originated from new customers - those that have not booked a cruise or holiday with us before - with a further 19% of the demand from people who have not holidayed or cruised with us for over 3 years,” Saga said.

The company owns the 37,000 gross ton Saga Sapphire and 19,000 gross ton Saga Ruby II, both of which were built in Germany in 1981.

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