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Orlando Ashford to leave Holland America Line after more than five years

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Written by Teijo Niemelä Teijo Niemelä

Category: Top Headlines Top Headlines

Published: 12 May 2020 12 May 2020

Holland America Line President Orlando Ashford announced that he will be leaving the company at the end of May. Ashford, who heads the premium cruise line within the Carnival Corporation family of brands, has been at the company for nearly five and half years and led a rejuvenation of the brand through an emphasis on enhanced onboard entertainment, live music and culinary experiences.

Since November 2014, Ashford has served as president of Holland America Line, leading the award-winning cruise line's brand and business, including its fleet of 14 premium vessels which carry more than 900,000 guests annually to all seven continents. He oversaw Holland America Line’s sales and marketing, revenue management, deployment and itinerary planning, public relations, hotel operations and strategy. Recently he has guided the company through an unprecedented pause in global cruise operations that have been extended through the line’s planned 2020 Alaska, Europe and Canada/New England sailing seasons.

“Orlando has made a substantial contribution to Holland America Line during his tenure, bringing a renewed energy to the premium cruise line that was recognized with many awards and accolades,” said Stein Kruse, Group CEO of Holland America Group and Carnival UK. “His unique background as an innovator and global leader in human resources was highly respected in our organization and his dynamism will be greatly missed.”

“It has been an honor and a privilege to lead the evolution of the Holland America Line brand for more than five years,” said Ashford. “I can’t say enough about the talent and teamwork both shoreside and on board the ships that has driven our many successes over the years.

“Today, a global pandemic has impacted our industry in ways that are completely unprecedented,” added Ashford. “However, I believe it is human nature to travel and explore new places and cultures and meet new people. I have no doubt that Holland America Line will thrive again soon, and its guests will be ready when cruise operations resume. I look forward to being one of the first to sail.”

Prior to joining Holland America Line, Ashford was president of the Talent Business Segment for Mercer, the global consulting leader in talent, health, retirement and investments. Previous to Mercer he served as senior vice president, chief human resources and communications officer of Mercer's parent company, Marsh & McLennan Companies. Ashford also has held several other leadership roles earlier in his career with organizations such as Coca-Cola, Motorola, Ameritech and Andersen Consulting.

Ashford serves on the board of directors of ITT, Inc., Hershey Entertainment & Resorts Company, Positive Coaching Alliance, Virginia Mason Medical Center and Year Up, a year-long intensive training program for underserved young adults.

Ashford is often recognized for his leadership. For example, Ashford was selected by Seattle Business Magazine for the 2019 Executive Excellence Award, honoring the best-of-the-best leaders in Washington state business and community.

Ashford’s book, “Talentism,” examines how technology and human networks can help bridge the skills gap, improve business performance and lead to the betterment of society at large. He has a second book currently in development.

Rick Meadows retires from Seabourn and Carnival Corporation after 35 years of service

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Written by Teijo Niemelä Teijo Niemelä

Category: Top Headlines Top Headlines

Published: 12 May 2020 12 May 2020

Today the cruise line announced that after 35 dedicated years with Carnival Corporation, Richard Meadows will be retiring from Seabourn at the end of May. Seabourn, the ultra-luxury brand in the Carnival Corporation family of brands, recently announced it was extending its pause in global cruise operations until mid-October through late November, depending on the ship.

Meadows is currently president of Seabourn and in this role has overall executive responsibility, leading all business and global operations for the award-winning luxury cruise line. He has held this position since 2011, when the company moved its headquarters to Seattle from Miami.

“I’ve had so many amazing opportunities throughout my career, passionately leading a number of global cruise brands as well as working with so many talented team members, travel advisors and other stakeholders around the world,” said Meadows. “It has been a true honor to help craft those lifetime memories and special moments for our guests, through the profound power of travel, which brings people and cultures together. I look forward to the day when we can once again welcome our guests back on board.”

Stein Kruse, Group CEO of the Holland America Group and Carnival UK into which Meadows reports added, “Rick’s contributions to the cruise industry and his leadership in elevating Seabourn to the ultimate ultra-luxury cruise experience, bar none -- are legendary. He will forever be part of our Carnival Corporation story and he has made us all better through his professionalism, authenticity and leadership.”

Between 2014 and 2016, Meadows also served in an additional leadership role as president of Cunard – North America, and assumed operating responsibility for the iconic Cunard brand throughout the North American continent.

Prior to his appointment at Cunard, Meadows was in a dual-capacity role, serving as both president of Seabourn and executive vice president of Marketing, Sales and Guest Programs for Holland America Line, where he had global revenue responsibility.

Among his previous roles, he was senior vice president of Sales and Marketing for Seabourn; vice president of Corporate Marketing at Carnival Corporation; and vice president of Sales and Marketing with Windstar Cruises, a former subsidiary of Holland America Line. He also served as director of sales for Carnival Cruise Lines, beginning his career with Carnival Corporation in 1985.

An active advocate for the cruise and travel industries, Meadows is a member of the board of directors for the Cruise Lines International Association (CLIA) in North America, and is a frequent speaker at industry forums and events. In 2007, Meadows was appointed by former Washington Governor Christine Gregoire to the Washington State Tourism Commission and served until 2010, and in 2017 he was named a Fellow by the Culinary Institute of America. He also currently serves on the board of directors for Seattle’s Fifth Avenue Theatre.

Opinion: Refocusing the cruise lens

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Written by Teijo Niemelä Teijo Niemelä

Category: Top Headlines Top Headlines

Published: 11 May 2020 11 May 2020

Written by Dr Wendy London

There is a militant cohort of people who would prefer if cruise ships didn’t exist. Their collective, narrow focus lens only takes in the bad stuff, like the incidence of norovirus on the ships, the dumping of bad waste into the sea and the smuts that can be seen forming a hazy cloud above a ship. This militant cohort doesn’t look beyond the outward symbols of bad. These people think they are Erin Brockovich, Ralph Nader and Rachel Carson all rolled into one. They set about to trash even the most innocuous posts about cruising on social media and try to sway public opinion by writing and supporting sensationalist stories in the mainstream media. We’ve all suffered their disapproval, and have the bitten, scarred tongues to prove it.

What makes me particularly sad and frustrated is that the cruise industry doesn’t invest enough in refuting the critics’ claims. I guess the reason is that the cruise lines believe that the sheer joy of cruising, the dream-making, will win out. No doubt that this is a true belief, given that cruising has continued to grow and grow. At least until this pause, this Covid-19 era. Now, cruise ships have taken centre stage as one of the leading evils, as the prime breeding ground for Covid-19. Cruising has come to a halt.

All sorts of scenarios are running through my mind to try to respond to this negativity. It might just come down to a very simple, and perhaps slightly obtuse (at least in this context) saying: ‘My enemy is my friend.’ Maybe this militant cohort, the muckrakers, have done us a favour. Maybe they are indeed our friend, because they have told us what they think is wrong, paving the way for us to refute their negativity. They certainly have made me think more seriously about what Covid-19 means for cruise tourism.

My take? We need to shift their lens. This isn't a story about cruise ships, It is a story about a pandemic. This is equally not (in the first instance) an economic crisis, it is a public health one. That pivot tells us a lot and how we should proceed.

In the first instance, the cruise ships did not invent Covid-19. In fact, the incidence of cases (passenger and crew) cruise ships is miniscule. On 24 April 2020, The Miami Herald reported that there were 2,787 cases onboard the ships. On that same date, Johns Hopkins University reported that the number of worldwide cases surpassed 2.6 million. In other words, cruise ships account for only one thousandth of all cases as at the end of April. Sure, no one knows for sure how many cases there really were on the ships, but nor is it known how many are active onshore. An intriguing statistic: one US aircraft carrier alone – the Theodore Roosevelt – reported more than 900 cases while other US Navy ships are also reporting cases. What about nursing/rest homes? The numbers are very very scary. Prisons, airplanes, boarding schools… all of these institutions are spaces of containment, where viruses are known to flourish if robust health and sanitation procedures are not followed.

As it turns out, cruise ships are held to an extremely high standard of safety, health and sanitation. All of us are aware of trigger events like the sinking of the Titanic (resulting in the creation and implementation of SOLAS), and the high profile intervention of the CDC in requiring high standards of cleanliness. Sure, not all cruise ships adhere equally, but sadly, we only hear about the bad stories, not the good stories.

It is here where we need to start refocusing the lens of those whose mission it is to criticise cruise ships. For example, what has happened, and with dizzying speed over the past weeks? The cruise lines have come up with health and safety regimes which, I dare say, would rival any space of containment onshore. Pre-boarding health checks, increasing laundry temperatures onboard, deep cleaning of passenger cabins and no more free-for-all buffets are just some of the protective health measures being put into place. So, in this sense, the presence of a threat has proven to be a good thing – continuous, fast-paced improvement in the face of a global health crisis. Time to tell this story so that its lessons can be applied in other sectors as well. It is not just a story about cruise ship practices, it is a story about how all spaces of containment should respond to major public health crises.

Before I move off this point, however, here is an example which solidly illustrates my point about the attitude of cruise line critics. Emirates Airline’s announcement that it would require all passengers to have an instant Covid-19 test before boarding was met with fanfare and flourish across the world. No one used that announcement as an excuse to criticise airplanes as a ‘bad’ mode of travel. Write a Facebook post about the health and safefy advancements undertaken by the cruise industry, and disparagement has no bounds.

Next focal plane in our new lens to address? The political response. We have seen instances over the past months where politicians and their bureaucracies engaged in blame-shifting and point-scoring concerning the disembarkation of passengers into local communities. In addition, inflammatory lip service was sometimes paid by the politicians to the plight of crew onboard the passenger-less ships, calling them ‘imprisoned’ and ‘badly treated’ (their take on the fact that the cruise lines were following best practice, isolating crew on the ships). With respect to the first observation, cruise ships are not and should never become political footballs – especially not in times like this. Instead, lessons learned from process failures should be transformed into robust codes to be agreed not just by the cruise industry (e.g. SOLAS and MARPOL) nor just by onshore agencies (e.g. a destination’s health ministry or department). Instead, codes – not dictatorial regulations – should be agreed in partnership with all affected parties, with the inclusion of appropriate expert advice. Now is not the time for confrontation, public displays of power or rancor. It is, instead, a golden time for collaboration; recognition of the social, economic and environmental contributions which each party can make; and respect for individual views. These are values that are not the sole domain of the cruise lines in the face of a pandemic, but should be adopted by all stakeholders in relation to any issue of public policy.

With respect to the second observation, i.e., ‘inflammatory lip-service,’ that, too, needs to change. Again, this isn’t an issue just about the cruise lines and their ships, but about how the rest of the world perceives anything it doesn’t completely understand. Sadly, the cruise industry doesn’t adequately convey its good work, onboard or onshore. Onboard, good stories range from the ships’ exemplary and innovative efforts to make the ships more environmentally sustainable to caring crew who go far beyond their jobs to embrace passsengers as family, forging life-long friendships. Onshore, the cruise lines contribute to social institutions such as schools, charities and orphanages. Discuss any of this on social media or through the mainstream media? The critics will find a dark-side, and denigrate even the most admirable activities and actions.

Very much related to this point is how the media – and politicians – frame stories about the cruise lines and their ships. Language such as ‘crew imprisoned in their rooms’ (quarantine requirements); passengers ‘stuck’ on ships; ‘the last cruise ship on Earth; and 'captive cruise ship staff beg to be arrested’ needs to change. Politicians, and local community stakeholders, tend to absorb this language, leading to inaccurate portrayals of the situation which mask the issues which really need to be addressed.

The cruise lines need to take assertive stance to refocus the critics’ lens. First, the cruise lines need to tell the stories of their good works, and their exemplary crews. Over recent years, the cruise lines have begun to embrace social media, including blogs on their own sites, but much more needs to be communicated. There are many channels which the cruise lines can use to disseminate their good stories. Secondly, and perhaps more critically, the cruise lines need to find a way to shed the public perception that the cruise lines are arrogant and hold boundless power. Instead, they need to engage more with the local communities they visit. Port agents, cruise associations and local cruise committees currently engage in dialogue, but local politicians and community leaders and representatives also need to be included. Ill-informed perceptions conveyed by politicians during informal live press conferences on social media platforms need to be corrected. Dialogue is the best way to correct these perceptions -- dialogue which should be initiated by the cruise lines and embrace not just the local cruise fraternity, but also local decision-makers and leaders from government, the wider business community and residents.

No one will argue with the proposition that the world has changed, and cruising along with it. But, as we have seen since the very beginnings of passenger ship travel, the industry continues to adapt to change, change brought about by global events such as war, economic downturns, terrorism and pandemic. In fact, the cruise lines are one of the great crisis survivors of all time. Wartime has seen luxury liners turned into troop carriers while economic downturns have seen creative creative pricing strategies leading to huge growth in the industry. Terrorism has seen the implementation of highly sophisticated ship and passenger security measures, as well as the establishment of new ports close to where passengers live. Earlier in this article, I mentioned the cruise lines’ proactive work to expand their health and safety regimes in response to the current health crisis. However, today, adaptation can and should go beyond the immediate needs of managing a health crisis. For those who dream about the future, it can provoke some blue-sky thinking. This future needs to start with financial and social responsibility necessity – and a further opportunity to refocus the critics’ lens.

A hint can be found in the conversion of luxury liners to troop ships in wartime. Today, the media is full of stories of cruise ship parking lots off the coasts of Mexico, the Philippines and other hospitable, safe harbours. The headlines and their stories are once again, predictably hostile. Compare: stories about aircraft parking lots in deserts and abandoned airports compel sympathy for the mothballed airplanes. Moreover, positive stories are now beginning to emerge about the airlines re-purposing at least some of their mothballed capacity by carrying more and more cargo, even in empty passenger cabins.

The cruise lines are in an even better position to repurpose their fleets. Cruise ships’ potential goes far beyond the airlines’ shift to carrying more cargo. As obvious as this next statement it is, it makes financial and social sense and engenders some near-term blue-sky thinking: ‘People can, and want, to live on cruise ships – and do.’ Cruise ships parked offshore, with minimal contact with virus-exposed land, make fantastic floating institutions of all sorts. As governments wrestle with the logistics of mass-quarantining of inbound air passengers, cruise ships can make ideal quarantine facilities for international ports-of-entry situated in coastal cities. Even airports could avail themselves of such facilities – Manila’s international airport has had to close for several days to manage the throughput of Filippinos arriving back, dealing with the logistics of testing, quarantine and onward travel. The proximity of the airport to the harbour makes the ships perfect quarantine facilities. It is inevitable, though, that a new wave of criticism will result.

That should not discourage the cruise lines from repurposing their ships, though, even if only during the pause to try to recoup revenue lost from leisure cruisers. There are many other possible uses, temporary uses, for cruise ships. Cruise ships are already used as floating universities. What about making them available to schools and universities fearing outbreaks on their land-based campuses? Or, as the weakness in the airline industry may take several years to recover, smaller cruise ships could also double as coastal ferries, offering point-to-point transportation options along with their leisure cruise guests. Longer term, though, I personally hope that the cruise lines re-consider their plans to jettison smaller ships in favour of larger, feature-rich, technologically-flash ships.

Certainly, Covid-19 has caused my lens to refocus, producing an even clearer image of how I perceive cruising. I have never been a fan of overt consumerism or glitz on land, or on the ships. Now, I value small, intimate, ‘learning’ ships even more – for the passengers and crew I meet, and frankly, for the benefits smaller ships can enjoy in terms of the monitoring and management of passenger health and safety. And even this compels a comparison with air travel and how it is perceived. Positive media attention and favourable comments surround recent press coverage about leaving middle seats free, changing the configuration of passenger cabins or installing protective screens. Raise the issue of a preference for smaller ships for any reason on social media? ‘All cruise ships are evil and should be banned.’ Time to re-focus.

I reckon that a recalibration of cruising would not be a bad thing, and indeed, we see it happening. Now, we just need to refocus the lens of the critics. Make them understand that cruising is about making dreams, about pumping billions of dollars a year into local economies, about creating jobs onshore as well as on the ships and about offering a form of tourism that makes travel possible for so many who would find land travel difficult or impossible. Make them understand that cruising is about adaptation and change. Now it is time for the critics to change, to refocus.

Dr Wendy London is acknowledged as one of the leading cruise tourism experts in both academic and economic development circles. She has written for publication in both the academic and commercial media. In 2018, Wendy completed her PhD on Auckland, New Zealand’s cruise infrastructure development, and is an Adjunct Research Fellow at Griffith Unviersity (Brisbane). Wendy is a tri-national (US/UK/NZ), having grown up in New Jersey and lived and worked in London, Amsterdam, Melbourne, and now New Zealand for the past 25 years. Prior to pursuing her love of tourism, Wendy was an IT lawyer and also worked in the area of information technology. Wendy and her husband are addicted cruisers, having traveled on 39 cruises to all continents, but New Zealand remains their favourite itinerary.

RCCL identifies capex cuts and estimates monthly cash burn at up to $275 million

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Written by Kari Reinikainen Kari Reinikainen

Category: Top Headlines Top Headlines

Published: 08 May 2020 08 May 2020

Royal Caribbean Cruises Ltd. (RCCL), the world’s second largest cruise shipping company, has identified significant reductions in capital expenditure and it estimates its cash burn at $250 million to $275 million per month.

Since the last earnings call, the company has identified approximately $3.0 billion and $1.4 billion of capital expenditure reductions or deferrals in 2020 and 2021, respectively, RCCL said in a statement.

The 2020 reductions and deferrals are comprised of:

$1.2 billion, of non-newbuild, discretionary capital expenditures and

$1.8 billion in reduced spend or deferred installment payments for newbuild related payments which the Company is currently finalizing.

The company believes COVID-19 has impacted shipyard operations and will result in delivery delays of ships previously planned for delivery in 2020 and 2021.

Since the last earnings call, RCCL has taken several additional actions to further improve its liquidity position and manage cash flow:

Increased the capacity under its revolving credit facilities by $0.6 billion, and fully drew on both facilities

Entered into a $2.35 billion 364-day senior secured credit facility with an option to extend (secured by 28 ships with a net book value of approximately $12 billion as of March 31, 2020)

Obtained a $0.8 billion, 12-month debt amortization and financial covenant holiday from certain export-credit backed facilities

Amended its non-export-credit backed bank facilities to incorporate a 12-month financial covenant holiday

Agreed with its lenders that it will not pay dividends or engage in stock repurchases.

“As of May 5, 2020, expected debt maturities for the remainder of 2020 and 2021 are $0.4 billion and $0.9 billion, respectively.

The Company estimates its cash burn to be, on average, in the range of approximately $250 million to $275 million per month during a suspension of operations,” RCCL said. 

“The Company is considering ways to further reduce the average monthly requirement under a prolonged out-of-service scenario and during start-up of operations,” RCCL pointed out.