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Cruise News for the Corporate Travel Professional

February 2011 Edition

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Royal Caribbean Close to Ordering More New Ships

Royal Caribbean Cruises Ltd. Chairman Richard Fain said the company is close to ordering more new ships for the Royal Caribbean International brand. He also denied rumors that the company is looking to sell its Azamara Club Cruises brand or the brand’s ships. (Image: Azamara Journey)

During a conference call with analysts announcing fourth-quarter earnings, Fain said the company is “working intensively on a new design,” perhaps of a new class of ships, but won’t formally announce a newbuild order “until all components are in place.” The new ships will incorporate the operating efficiencies and innovative guest amenities that the company has developed over recent years, he said. “While we look forward to a period of slower growth we do not intend to stagnate,” he said. “We feel the time may be right for such a move.”

One analyst asked Fain if rumors are true that RCCL is looking to sell either the Azamara brand or its two 694-passenger ships. “I’m not interested in selling the brand or the ships,” Fain said. “Azamara actually had probably the biggest increase in the fleet in terms of both passenger satisfaction and pricing, percentage wise. We’re not in the market to sell the ships or the brand.”

Another analyst asked whether Royal Caribbean was reevaluating Mexico as a destination for its ships. Several cruise lines this week cancelled calls at Mazatlan, on the Pacific Coast, due to reports of crime against cruise passengers. Royal Caribbean International President and CEO Adam Goldstein said Mariner of the Seas has been moved out of Los Angeles and will cruise in Brazil, Europe and from Galveston this year. “After that we won’t have any regular capacity in the West Coast of Mexico in the foreseeable future,” he said.

Goldstein added that there should be a distinction between the East and West Coast of Mexico. “In the Gulf of Mexico, we’re frequently going to Cozumel and Costa Maya and other ports, and we are seeing good demand,” he said. “Our biggest and new ships are going to those ports on a regular basis, and we don’t feel there are any obstacles.

Follow Up:- It’s official: Royal Caribbean International to get a new class of ship.

The 5,400-passenger Oasis of the Seas is significantly larger than the new ship would be.CAPTIONCourtesy Royal CaribbeanRoyal Caribbean International's parent company has signed a letter of intent with German shipyard Meyer Werft to build at least one 4,100-passenger, 158,000-ton ship for the line, with scheduled delivery in fall 2014.

The order would also include an option for a second ship, with a spring 2015 delivery.

"This next generation will not disappoint," said Richard Fain, chairman and CEO of Royal Caribbean's parent company Royal Caribbean' Cruises, Ltd., in a statement.

RELATED: Is Royal Caribbean about to order a new ship?
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Fain would not divulge any of the features that "Project Sunshine," as the class of ship is now code-named, might have, but he did say to expect "new activities and entertainment concepts."

"It will offer features for everyone," Fain said. "From grand, spectacular spaces to small intimate settings; from active, invigorating activities to the serenity of more personal space; and from a plethora of dining alternatives to a cornucopia of opportunities for families."

Fain also said the ships would take the leading-edge energy efficiencies and environmental technologies "one further step."

The 158,000-ton ships are almost exactly the same size as Royal Caribbean's 160,000-ton, 3,600-passenger Freedom-class vessels, and significantly smaller than the line's last two new builds, the 5,400-passenger Oasis-class ships.

Fain told Wall Street analysts in late January that "the time may be right" to order a new ship, and that the line had been working on a new design.

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