The new year started with a slew of news, some good some bad.  Lets get the bad out of the way first...  Two European cruise lines, both of whom are heavily indebted on their new ships, have had had ships impounded and now face bankruptcy.

Festival was forced to cancel the sailing of the m/v Caribe which was due to leave Santo Domingo in the Dominican Republic last Saturday. The 500-passenger ship which is on long term charter to Festival was the last ship in its operating fleet still cruising. Five of  Festival's ships are now under arrest and a sixth, the m/v Azur is headed for lay-up in Gibraltar.

The problem arose after Festival was late in making bareboat charter payments of 12.4 Euro's on their three newest ships.  Festival are seeking new investors in an attempt to find a way out of the financial crisis that has resulted in the arrest of the five ships. An upbeat press release from the company stated that they expect a positive outcome from their restructuring negotiations with their bankers

Meanwhile Festival have had some success in their continuing court fight with ALSTOM and Credit Agricole over the arrest of Mistral and where awarded a token 300.000 euro's as compensation. After a positive ruling in Marseille a court in Barbados has denied the right of a representative for Alstom and Credit Agricole to repossess the European Vision.

Adding to Festivals concerns are rumors that MSC (Mediterranean Shipping Company) are standing behind Alstom and are ready to buy one or all of the three Festival ships currently under arrest if they are repossessed and auctioned off.  Bearing in mind that the European Vision and European Stars are elder sisters to MSC’s Lirica and Opera.

Two subsidiaries of Royal Olympic Cruise Line filed for Chapter 11 protection in Honolulu in December and later agreed to allow creditors to arrest the Olympia Voyager and Olympia Explorer, paving the way for sales at auction. A third ship, Olympia Countess ( previously the Cunard Countess) was arrested in Durban and a South African court approved the sale of that ship at auction.

The long troubled Royal Olympic Cruise Lines recently stated that its ship owning subsidiaries have requested protection from creditors in a Greek court, an action similar to filing for Chapter 11 under the US bankruptcy code.  The court filing involves three subsidiaries separate from the two that filed in the US and the one whose ship was arrested in Durban.  The company is in negotiation with its creditors to find a solution, however, it also stated that if no alternative is found, it may be forced to cease operations.

 The good news.. After one on the biggest media blitzes in shipping history, the QM2 (Cunard's Queen Mary 2) finally arrived at her home port of Fort Lauderdale, Florida.  The City of Fort Lauderdale and inhabitants for many miles around turned out in force to welcome this landmark ship to her new homeport.

QM 2 entered Port Everglades shortly after 7 a.m. on Monday January 26, escorted by a flotilla of tugboats spraying red and blue water as well as a procession of Coast Guard and Navy vessels that escorted the liner to her berth.

QM2 will spend about a week in Port Everglades before sailing on her first scheduled US departure.  In the interim a huge publicity campaign will introduce the ship to the trade, city officials and past passengers.  Two short sailings will not only give a luck few a taste and flavor of the ship, but also allow for some fine tuning of both the hardware and service.

State of the Industry:

Royal Caribbean’s better than expected outlook on last weeks earnings call sent analysts revising their estimates upward.  The company now projects net revenue yields to climb 5% to 7% in 2004.  UBS Warburg raised estimates before the call, suggesting that the numbers could go higher afterward, and they did.  Analyst Robin Farley points out that Royal Caribbean allows for an even higher EPS up to $2.30 in 2004. ‘We believe the big driver in ’04 yield performance is recovery, not growth,’ Farley writes in a research note. ‘If net yields were to increase 5.8% in '04, that would still be roughly 5.5% below '00 yields. In our view, that leaves room for more upside either this year or in ’05.’

Whilst the major players are posting impressive numbers there is still some concern with some of the smaller niche and luxury lines.  Speaking with a number of industry people on the "front line" almost without exception they express confidence that the worst is behind them and a steady growth in numbers will herald a increase in revenues as we move into the year.

With the 2004 wave period off to a strong start and several lines posting record bookings, the North American cruise industry is on its way to another record-setting year, according to the Cruise Lines International Association.  At Radisson Seven Seas Cruises, ‘Call volume since the first of the year is up 30% over the same date last year and revenue for 2004 is up almost 30%,’ says CLIA chairman Mark Conroy, the president and ceo of RSSC. ‘Close-in bookings represent a good portion of the volume; however, we are also seeing great activity for the summer programs in Europe, Bermuda and Alaska.’

Worldwide has been recommending to our clients to get off the fence and make decisions for programs in 04 and 05 as prices have already moved upwards and will continue to do so.  "There is still some tremendous value out there", states Mr Steve Bloss, President of Sales for Worldwide.  "One has to choose wisely and that is where WWTCA comes into its own,  as an independent, we are able to advise our clients on the best choice of ship and itinerary as well as negotiate prices from a position of strength".  "WWTCA's annual volume puts us in the drivers seat and many of our clients are aware they benefit on several fronts when it comes to deciding whether to use WWTCA or "go it alone".  "We are proud to continue with our no fee policy and happy to offer our clients to best and most up-to date reviews and unbiased opinions of the hardware available to them".

Ship Report:

Worldwide was fortunate to be invited on a three day, two night cruise to nowhere on the QM2 and our report on the ship will be emailed later this week.

Important Information:

• Boarding Documents: Royal Caribbean International has announced they are instigating a new method of dealing with documents which our clients should be aware of as it will certainly impact some programs. The new system, which is automatic states than ANY ticket issued 21 days or less prior to sailing WILL BE AN E DOC ONLY. This would mean that if, at 30 days prior when RCI start running the documents and you are not fully paid on the group, RCI will hold back documents corresponding to the value of what is still due if you have any cabins with tba on them, or if you have any subsequent name changes. You can request that they be paper docs but they will cost $35 per ticket. The only solution to avoid this is going to be very important that at 30 days prior we have all your names, there are no name changes, and that everything is fully paid. 

• Additional Cruising Tax; A bill that would levy a $100 head tax on Alaska cruise passengers was referred to a subcommittee that will assess its legality. HB 207, is a holdover from last year’s legislative session. Proceeds of the tax would go to the state’s general fund. Opponents question the legality of taxing cruisers to pay for a budgetary shortfall as no revenues are directed to cruise-related functions or services. No words on when the subcommittee will report back on the legality of HB 207, but for now it’s gone.

New Builds:

• At the time of going to press with this newsletter there are nineteen new ships on order through 2006 including Med Shippings ' new ship the "Opera". 

• The numbers are impressive, the total order book value is $7,528m US dollars.  The average cost per cabin being $158,165 with Holland America's cabins being the most expensive at $216,450 per cabin and Costa's per cabin cost at $118,421 being the least expensive of the main stream cruise lines. 

• Princess Cruise Lines have the most new hardware on order with three new ships being delivered in 2004 and one  in 2005. 

• The first new cruise ship of 2004 is slated to be Carnival Cruise Lines "Miracle" which is due any day  (Jim Huff is sailing on the inaugural on Feb. 27th - look for his report in our March newsletter) closely followed by Princess's "Diamond Princess" also due in February.  (Venue & Menus report - click here).

• Royal Caribbean’s option for a second Ultra Voyager ship from Kvaerner Masa-Yards expires in September.   On today’s earnings call, management was asked: if that option were extended, would it push the 2007 delivery date back? During the week in September that Royal Caribbean triggered the order for the UV1, the euro was at one of its lowest points against the dollar in recent months,  at about $1.08-$1.10. Today, the euro closed at $1.24 -- some 10%-12% higher than in September.

Port News:

• Sydney, Australia;  The New South Wales Tourism Minister Sandra Nori welcomed Radisson's "Seven Seas Voyager" when she docked at the Overseas Passenger Terminal this morning on her maiden visit to Australia. An exchange of plaques was followed by an on-board VIP luncheon hosted by RSSC's  local GSA.

• Noumea, New Caledonia ; The South Pacific as a  destination is attracting many cruise lines such as e Crystal, Cunard and Radisson Seven Seas Cruises, as well as P&O and Star Cruises.  Work currently underway and expected to be completed by the end of this year include  major improvements to Noumea’s cruise terminal.   It is expected that the other lesser known, but spectacularly beautiful  ports of Poum, Hienghene, Mare and Ouvea will soon become as popular as Noumea and the Isle of Pines

• Valencia, Spain;  Will be the host the next America’s Cup Race.  More than 60 cities competed to host the 32nd America’s Cup. AMC, the company in charge of organizing the next competition chose Valencia in November.  Valencia has ambitious plans to upgrade the local infrastructure.  Plans being discussed include, accelerate the work on the High Speed Train (AVE) connection between Valencia and Madrid that will shorten the journey between the two cities 90 minutes, create new services and hotels, improve the international airport, build a metro line from the airport to the port, and remodel the docks at the Port of Valencia.  The port works include the construction of a canal to connect it to the sea, creating new areas and restoration of existing buildings. Final details have yet to worked out, but it is expected to include a dedicated area for cruise vessels and passenger facilities. Valencia received 68 calls and 50,171 passengers last year and  expects 125 calls this year, bringing around 90,000 passengers, an 80% increase on 2003

• Rostock-Warnemünde;  The gateway for cruise passengers visiting Berlin will inaugurate a new terminal in the spring of 2005.   Seetours, a regular caller at the port, is due to switch its operations to Kiel for the 2004 season during the construction phase although "Aida Blu"  is scheduled to return to home port here in 2005.   The state-of-the-art building is considered by insiders to be avante garde and will feature facilities which are so far uncommon in Europe. 

• Whittier, Canada; Carnival Spirit will depart from Whittier instead of Seward on its seven-day southbound Alaska cruises starting this summer, mirroring that of sister line Princess Cruises. Both brands will use Whittier’s new cruise facility.   Carnival said the shift to Whittier will save passengers 90 minutes of travel time from the airport at Anchorage.  Previously the trip to Seward took about three hours by motorcoach. Using Whittier as an embarkation point for southbound cruises also allows for a longer eight-hour stay in Sitka, the first stop on that itinerary. Seven-day northbound Alaska cruises on the 2,124-passenger Carnival Spirit will continue to depart from Vancouver. 

• Cape Liberty Cruise Port; Royal Caribbean Cruises Ltd. will name its new facility in Bayonne, N.J. the ‘Cape Liberty Cruise Port.’  Starting in May, Cape Liberty will serve as a seasonal home port to Voyager of the Seas and Nordic Empress.  In December, Royal Caribbean signed a letter agreement with the Bayonne Local Redevelopment Authority to construct and operate a new cruise port facility on the former Bayonne Military Ocean Terminal peninsula, now called The Peninsula at Bayonne Harbor.  "Cape Liberty Cruise Port is a fitting name as our guests will begin and end their vacations with a marvelous view of the Statue of Liberty and lower Manhattan,’ says Adam Goldstein, executive vp brand operations for Royal Caribbean International".   The location is 15 minutes from the Newark airport and right off the New Jersey Turnpike.

Ship News:

• m.s. Paul Gaugin is named "top ship in the world".   Radisson Seven Seas Cruises is thrilled to share with you the wonderful news that the m/s Paul Gauguin has been named Top Ship in the World by Condé Nast Traveler, scoring an impressive 97.7 out of a possible 100.  In addition, we are equally excited to note that the Seven Seas Navigator has been named #2 in the world, scoring a 95.3.

• Norwegian Cruise Line recently announced that a severe storm in Germany was the cause of the sinking of their new ship the Pride of America which was undergoing fitting-out alongside the shipyards dock.   High seas breaking against the side of the ship gained ingress to the hull some three stories above the water line, gradually filling the partly constructed hull until it finally came to rest on the ocean floor.  At the time of going to press she is  still partly submerged.  Substantial damage was done to the machinery and a number of cabins which where nearing completion.  NCL announced that the ship would be substantially delayed ("months rather than weeks") and now looks as though it will not be completed until late 2005.  In the interim it will be replaced for its inter-island Hawaii sailings this summer by the Pride of Aloha. The Aloha, currently sailing as the Norwegian Sky, was scheduled for 3-4 day Hawaii sailings in October, following a multi-million dollar remodeling and a reflagging into the U.S. registry.  Now, the ship will undergo refurbishment and reflagging in May in order to be ready for seven-day inter-island sailings beginning July 4, 2004.   Star Cruises SuperStar Leo will join Norwegian Cruise Line's fleet in Alaska in May to take over for the Norwegian Sky.   The Sky will be refurbished and reflagged in May as the Pride of Aloha to take over for the Pride of America in Hawaii.  SuperStar Leo was built in 1998 at the Meyer Werft Shipyard and holds 1,966 passengers. The Star Cruises press release also notes that a mid-sized NCL ship will be transferred to Star Cruises by the end of 2004.

• m.s. Nordic Empress; RCI announced the Nordic Empress to receive major renovations and a new name.  RCI recently announced that the Nordic Empress will undergo extensive renovations before commencing her spring cruises in the New York City metro area.  She will start a series of unique six- and eight-night Bermuda cruise vacations from the newly named Cape Liberty Cruise Port.  RCI has indicated she will be officially rename the "Empress of the Seas", bringing her in line with the remainder of Royal Caribbean’s fleet all of  which feature "of the Seas" names. Renovations on the 1,602-passenger Nordic Empress will extend to every area of the ship, and are designed to further enhance the onboard experience. A main focus is providing guests with additional dining, entertainment and fitness areas, it is anticipated that the work will be completed by May 2004.

Cruise Opportunities:

From time to time WWTCA is able to offer some last minute deal, cancelled charter opportunities and other deal of particular interest.  This month we have the following which,  if the dates work for your programs - represent amazing value.

These following dates are all on smaller, 5 star ships (pax count from100 to 400)

March 19-24, 2004,  5 nights - Caribbean

April 5-9, 2004,  4 nights - Caribbean

April 9-14, 2004, 5 nights - Caribbean

May 5-12, 2004,  7 nights Europe (Atlantic seaboard)

August 16-23, 2004,  7 Eastern  Med.

October 11-18, 2004, 7 night Eastern Med.

November 13-17, 2004,  4 nights Caribbean

November 17-22, 2004,  5 nights Caribbean

November 29 - December 5, 2004 Caribbean

Another small ship opportunity;

March 11 – 13, 2004, 2 nights Caribbean

May 8 – 13, 2004,  5 nights South France etc.

May 12 – 13, 2004, 1 night South France etc.

Top of the line smaller ship

August 30, 2004,  7 nights Med.

September 01, 2004,  7 Nights West Coast USA

September 22, 2004 , 7 nights South of France etc.

October 06, 2004, 7 nights Italian Riviera

February 8, 2005, Western Caribbean

February 24, 2005, Central Caribbean

Finally

November 6, 2004, 7 nights Western Med.

November 7, 2004, 7 nights Western Med.

November 14, 2004, 7 Nights Western Med.