News: Carnival to sell 18 ships as demand sinks

Carnival Corporation has confirmed it will continue to shrink the size of its fleet as the cruise sector struggles to return from the Covid-19 shutdown.

In July, the company said it would dispose of 13 vessels as demand shrank.

The figure has now been increased to 18 – with Carnival planning to offer approximately 12 per cent less capacity next year when compared to 2019.

Noting all of the ships to be sold were older and less efficient, Carnival said the vessels had only produced three per cent of its operating income in 2019.

Also being older ships, Carnival added their disposal would improve the fuel efficiency at the corporation.

ADVERTISEMENT

A total of eight ships have already been sold, and delivered to new owners.

The news comes as Carnival reported a GAAP net loss for the third quarter of $2.9 billion, adjusted to $1.7 billion.

The company said average monthly cash burn stood at $770 million, in line with previous projections.

Since announcing its intention to downsize its fleet, Carnival has confirmed the sale of four cruise ships from Holland America Line, two from Costa Cruises, two from Carnival Cruise Line and one from P&O.

In addition, two more ships from Costa Cruises were already sold and due to be delivered to a new Chinese joint venture, and two ships were sold from P&O Australia and due for delivery in 2021 to Cruise and Maritime Voyages.

CMV, however, went into administration during the summer.

Carnival Corporation chief executive, Arnold Donald, sought to strike an upbeat tone.

He said: “With two thirds of our guests repeat cruisers each year, we believe the reduction in capacity leaves us well positioned to take advantage of the proven resiliency of, and the pent up demand for cruise travel – as evidenced by our being at the higher end of historical booking curves for the second half of 2021.

“We will emerge with a more efficient fleet, with a stretched out newbuild order book and having paused new ship orders, leaving us with no deliveries in 2024 and only one delivery in 2025, allowing us to pay down debt and create increasing value for our shareholders.”

Leave a Reply

Your email address will not be published. Required fields are marked *