By
Rebecca Gibson |
Carnival Corporation & plc has signed a memorandum of understanding (MOU) with the China State Shipbuilding Corporation (CSSC) to explore the possibility of establishing a joint venture that would accelerate the growth of the Chinese cruise industry.
Signed at the Ninth China Cruise Shipping and International Cruise Expo in Tianjin, the MOU outlines the framework for a partnership between Carnival Corporation and the CSSC that includes the possibility of forming a joint shipbuilding venture, which could be expanded to include Italian shipbuilder Fincantieri.
As part of the possible venture, Carnival Corporation, CSSC and Fincantieri would collaborate to define the specifications of the first-ever, world-class cruise ship to be built in China. The MOU also includes the possibility of exploring other joint ventures with CSSC related to the development of a domestic cruise company and ports, the creation of training programmes, and improving supply chain and logistics.
“This is really a breakthrough day for all of us at Carnival, as well as our friends at the CSSC and all Chinese travellers 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.”
The MOU also supports Carnival Corporation’s strategy to expand its capacity in Asia. The company recently announced that global COO Alan Buckelew is to relocate to China to expand his leadership role and oversee the company’s growing operations in the country. In his expanded role, Buckelew will lead all of the company’s initiatives in China, while also continuing to provide oversight of all maritime and port operations around the world and a number of related functions as part of his COO role.
This year, Carnival Corporation’s total capacity in China increased by 66%, after Princess Cruises – a Carnival Corporation brand – began homeporting Sapphire Princess in Shanghai in summer 2014.
In 2015, Carnival Corporation will become the first global cruise company with four ships based in China when Costa Cruises’ deploys Costa Serena year-round in Shanghai, China, from April, where she will join her sister ships Costa Victoria and Costa Atlantica. The move will increase Costa’s overall capacity in Asia by 74%, while Carnival Corporation’s total capacity is expected to rise 140% over a two-year period.
In total, Carnival will have 220 port calls from five brands in China in 2014, amounting to 15% of the company’s total port calls in all of Asia, a region where Carnival doubled its market share over the past two years.
Meanwhile, the new partnership aims to support the Chinese Ministry of Transport’s (MOT) initiatives to transform China into a leading global cruise market and spur new economic development from tourism.
According to the MOT, China is expected to become the second largest global cruise market after the US in the next several years based on economic growth, the increased spending power of Chinese consumers and the growing demand for cruise vacations in the country. In addition, it is expected to be one of the world’s largest cruise markets with 4.5 million passengers by 2020.