By sending its next ship to sail from Shanghai, Princess
Cruises will vault into the vanguard of Western cruise lines seeking to source
passengers from fast-growing China.
Princess said it will use the third ship in its Royal class,
set for delivery in 2017, to establish a year-round presence in China, one of
only three cruise lines to have done so.
The 3,560-passenger ship will be from the largest class of
vessels that Princess sails, one-third larger than the 10-year-old Sapphire
Princess, which begins its second season of summer sailings from Shanghai next
“Deploying our next new ship in China underscores our strong
commitment to growing the China cruise market,” Princess President Jan Swartz
said in a statement.
The move echoes the decision in April 2014 by Royal
Caribbean International to commit the Quantum of the Seas to Shanghai even
before it had been delivered. After six months of interim sailings, the ship
left New York on a transit cruise May 2 and will begin year-round cruising in
China in June.
At the time, Royal Caribbean CEO Adam Goldstein said the
company felt it had an asset in the Quantum that was impossible to match.
The Princess ship, as yet unnamed, will be a follow-up to
the Royal Princess and Regal Princess, which will remain on U.S.- and
European-based itineraries. When they were introduced in 2013 and 2014,
respectively, they made a splash with their protruding SeaWalk platforms,
dancing water fountains and a pair of elegant chef’s table restaurants.
In addition to those features, the 2017 ship under
construction at the Fincantieri shipyard in Italy will be customized for
Chinese guests, using the Princess Class elements pioneered on the Sapphire Princess.
They include the World Leaders Dinner, a traditional English
afternoon tea, a Lobster Grill, Ultimate Balcony Dining, an oceanview, hot-pot
dinner option, ballroom dancing and expanded duty-free shopping.
“And as this ship is still in the design phase, we are
looking forward to creating other new and exciting venues and experiences
catering to the Chinese vacationer, which we will reveal in the coming months,”
In announcing the ship, Princess said it will be “the first
year-round international luxury vessel designed and built specifically for
The announcement comes as competition begins in earnest for
the Chinese customer.
On May 15, a joint venture between Royal Caribbean Cruises
Ltd. and Chinese online travel agency Ctrip will begin sailing the former
Celebrity Century from Shanghai.
The 1,800-passenger ship has undergone a renovation, which
included the addition of an ice bar, a trampoline and minigolf as well as a
makeover of the restaurants to tailor them to Chinese tastes. It will sail
under the name SkySea Golden Era.
On May 21, the Sapphire Princess begins its second summer of
sailings from Shanghai, followed by the arrival of the Quantum in June.
Carnival Corp. is also represented in the Chinese market by
Costa Cruises, which has been sailing the Costa Serena from Shanghai since
In a note to investors issued after the Princess
announcement, UBS Securities predicted that 2015 will be the tipping point for
China to become a “game-changing force” for the cruise industry.
UBS analyst Robin Farley said China will not only provide a
new source of demand but will reduce capacity and strengthen pricing in more
mature markets such as North America and Europe.
The international cruise industry’s presence in China has been
growing since 2008 when Costa first put a ship there dedicated to the Chinese
market. Carnival Corp. sent then-Costa chairman Pier Luigi Foschi to oversee
its Asian operations.
After Foschi left Carnival, former Princess Cruises
president Alan Buckelew was named chief operations officer and was dispatched
to China. Although Costa has two other ships, the Costa Victoria and Costa
Atlantica, also sailing from China, the shift of a Princess newbuild to China
will significantly step up Princess’ presence there.
After the 2017 delivery, Princess has no new ships on order,
although Carnival Corp. recently announced an agreement in principle with two
European shipyards to build nine vessels from 2019 to 2022.
Carnival Corp. has also agreed to explore a joint venture
with Fincantieri and the China State Shipbuilding Corp. to develop the first
“world-class cruise ship” to be built in China.
Norwegian Cruise Line has formed a task force to evaluate
whether and how to enter the Chinese market. However, its largest shareholder
is Genting Group, a Malaysia-based company that also owns Star Cruises, a line
that is focused solely on the Asia market.
During the company’s earnings call last week, CEO Frank Del
Rio said, “It is incredible to see our competitors devoting their newest,
largest and probably best-performing ships to the Chinese market.” He added that the Norwegian study group would
deliver its findings by year’s end.