Cruise Lines Encounter More Losses As Pandemic Continues - Ships Scrapped.


Published: January 12, 2021 - 12:01 AM

Carnival Cruises New Carnival Mardi Gras

Carnival Cruises New Carnival Mardi Gras has yet to take a revenue generating passenger - Cruise lines with mounting losses.

Talk about an industry needing a break. Today Carnival Corp released their fourth quarter earning. Posting a loss of $2.2 Billion dollar and the need to sell 4 more ships for a total of 19 ships sold / scrapped, the bad news continues to flow in. In addition Carnival Corp has delayed the delivery of 5 new ships reducing the number to one new ship in 2021. Carnival also has a number of new ships delvered in 2020 which have yet to carry a revenue generating passenger. These ships specifically being the Carnival Cruises' Mardi Gras, Princess Cruises' Enchanted Princess, Costa Cruises' Costa Firenza and P&O's Iona.

Other cruise lines in a similar situation include Virgin Voyages which has taken delivery of the Scarlet Lady and in expecting the Valiant Lady in the 2nd Qtr of 2021, but were not able to sail a revenue generating cruise yet. Also in the same boat (no pun intended) is Celebrity Cruises' New Celebrity Apex and Saga Cruises Spirit of Adventure. There are others as well.

Although the CDC has outlined the requirements to return to service, those rules are not easy to comply with. The return to cruising is will be a long and complicated road. Also in todays announcement, Carnival said they expect ALL ships to return to service in 2021. That is a giant task to achieve and I wish them well. another challenge us that many ports in the Bahamas, Caribbean, Canada and Alaska are not yet open to cruise lines so even if they were allowed to sail - Where would they go? Most likely cruises to their private islands, since cruises to nowhere are not permitted from US ports unless they are on a US registered ship.

While all of this is going on, the number of ships at scrappers has increased. The Marco Polo (Black Sea Shipping Company, Orient Lines and CMV) was sold at auction when CMV went in administration. The ship was expected to be used as an accommodation ship in Dubai but after arriving in Dubai, she was sold to scrappers when the accommodation ship deal fell through. In addition the Grand Celebration, ex, Celebration of Carnival Cruises, and most recently the Grand Celebration for Bahamas Paradise Cruise Line took a long road to the scrappers making a stop in Madagascar. Both ships arrived at Alang, India on January 9 and 10 2020. Both ships remain at anchor but are expected to be beached in the next few days based on the high tides. They will be joining on the beaches of Alang with the already beached Karnika (of Jalesh Cruises), The Dream (ex Tropicale / Costa Tropicale / Ocean Dream - Peaceboat) and the ocean going gambling ferry/Cruise ship Metropolis.

Meanwhile the beaches of Aliaga Turkey is expected to have a another ship arrive in the next few weeks. The Costa Victoria was sold to an Italian Shipbuilder, originally expected to be used as an accommodation ship for shipyard workers. Unfortunately the need never materialized and it has been confirmed the ships will be towed to Turkey departing from Piombino Italy at the end of a tow line from the tug Vos Chablis possibly as soon as this week.

Another piece of sad news, the Columbus (ex Star Princess From Princess Cruises) from Cruise and Maritime Voyages (CMV) was reportedly sold to the owner of Seajets (along with a number of other cruise ships). The Columbus is now laid up in Eleusis, Greece, no longer active. This is usually an indication that the ship too may soon be going to scrappers.

The Satoshi (ex Regal Princess / Pacific Dawn) has been sold to Indian Ship Breakers as well after arriving in Panama. It was expected that the ship was to be used as an offshore community for entrepreneurs and progressive thinker, but when insurance for the vessel could not be secured, the ship was sold to scrappers. The ship remains anchored off of Panama at this time.

And finally, the Funchal as reported in a prior article, is expected to be sold at auction by the end of the month. It is expected that based on the current state of the cruise industry, the amount of ships on the market and low demand, that ship scrappers will most-likely be the winning bidder

The months ahead will not be easy ones for the cruise lines and there will be ups and downs. If the cruise lines can remain solvent through the pandemic, once cruising returns to normal the available capacity will be exceed the demand (based on the ships being scrapped and the slow introduction of replacement ships. With reduced inventory and increased demand the cruise lines have the potential to make money. In addition, Seajets and other companies buying ships at a steep discount now, are poised to make big money when demand spikes and start up companies seek available tonnage. All these possibilities are many months / year(s) away - but are all viable. Only time shall tell.


Copyright (c) 2020



Copyright (c) 2020


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