Carnival agree Joint Cruise Venture in China
Last week, President Xi Jinping of China spent time in London and Manchester during a visit to the UK. It was hoped the move would bring about financial investment from China, and one area to have benefitted from the visit is the cruising sector. Both Xi Jinping and UK Prime Minister David Cameron were present as Carnival Corporation signed a $4billion deal to establish a joint multi-vessel cruising venture devoted purely to China.
The venture will be carried out in collaboration with China’s largest shipbuilder, China State Shipbuilding Corp (CSSC), and China Investment Corp. These two Chinese state-owned firms will collectively own 60% of the venture, whilst Carnival Corp will own the remaining percentage.
The cruise line is yet to be named but, as our previous articles suggest, Asia is the fastest growing market. Further growth is projected in China, with cruise travel sales set to double to $11.5 billion by 2018 from $6.8 in 2013, according to Euromonitor.
Whilst further details are due to be released in the coming weeks, it has been confirmed that the new cruise line will order about five brand new ships – each of which will be built by Shanghai Waigaoqiao Shipbuilding Company. At present, no cruise ships have ever been built in China, although many cruise lines either have plans for have stated an intention to do so.
The five ships are thought to cost a combined total of 25 billion yuan (over £2.5 billion). Each of the vessels will measure a gross tonnage of 130,000, with the length exceeding 300m and a capacity for 5,000 passengers. It is thought construction will start on the first vessel next year, with a launch date set for 2020.
Alan Buckelew, Carnival’s global chief operations officer, said in a statement: "This joint venture is a significant step forward for the cruise industry in China and a tremendous opportunity … to increase awareness, interest and demand for cruise vacations among domestic Chinese travellers."
China is serious when it comes to tourism, with plans already outlined for ten new cruise ports by 2020. Undoubtedly, these new ports will support cruise ships from lines such as Royal Caribbean, Carnival Cruise Line, AIDA, Costa Cruises, Norwegian Cruise Line and MSC Cruises. Each of these cruise lines has announced intentions to dedicate vessels for a Chinese market in recent weeks.
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