Putting perhaps the best face on tough times, executives at the State of the Industry panel discussion said adversity has brought the far-flung industry together in order to survive what was a near-death experience.
Jason Liberty, president and CEO of Royal Caribbean Group, likened COVID-19 to the asteroid that struck prehistoric Earth, wiping out the dinosaurs.
Surviving a meteor hit
‘When you’re in a moment when a meteor directly hits your company, and your industry, you look around,’ Liberty said. ‘Many of us looked around at each other, at our colleagues, all the different partners we had out there and came together to be a species that actually survived a direct meteor hit.’
As the industry came back, crew members and guests came together to tell the tale of how new protocols were keeping them safe.
Carnival Corp. CEO Arnold Donald invoked an army of Uber drivers that made it transparent to the public during COVID how many people depended on the cruise industry for their jobs. ‘Without those resources we would not have been able to weather this storm,’ he said.
A community to influence government
Kelly Craighead, president and CEO of Cruise Lines International Association, referred to the ‘ecosystem’ of cruise stakeholders, to which CLIA lent unity and a common data source. ‘So much was changing so quickly,’ Craighead said to panel moderator Lucy Hockings, a BBC anchor. A strong global trade association gave the cruise community the ability to influence government at all levels and to ‘to take action when you needed to be able to have your voice heard,’ she said.
Turning to new challenges, like inflation, panelists said cruising has always stood out as a cheap vacation when prices were marching higher. ‘On a relative basis we’re just a much better value, and a better experience,’ said Donald, whose move to Carnival Corp. vice chairman come August was made public just as the panel began.
The most popular guy in the room
Pierfrancesco Vago, executive chairman of the cruise division at MSC Group, a container shipping giant, said global supply chain disruptions make inflation inevitable, but that his company stands ready to ride to the rescue.
‘That’s why I’m the most popular guy in the room,’ Vago quipped, ‘because I’m helping everybody.’
Vago, also chairman of CLIA, said the industry stands ready to exceed its pre-COVID passenger levels by next year. He said that by July 90% of the industry’s capacity will have returned to service, representing 270 ships and 550,000 lower berths.
He said the industry should now turn to the challenge of filling the demand gap for scheduled capacity growth of 4.7m cruisers by 2025.
Cruising’s ‘critical issue’
Longer-term, Vago highlighted environmental sustainability as cruising’s ‘critical issue.’ He said the industry is making great progress on lowering its carbon footprint and that regulators could do more than set targets without saying how companies are supposed to achieve them.
He also called on governments to include cruising in sustainable finance programs to transition to a carbon-free future.
Shore power commitment
Craighead unveiled a new industry initiative to equip all CLIA-member ships with shore power connections for ports that offer it, and to use alternative low carbon technologies at ports without shore power facilities.
At the same time, Donald urged the port delegates in the Seatrade audience to lobby for shore power connections to make the initiative more valuable. ‘We want to work with the ports to make sure they have that infrastructure in place,’ he said.
Donald said that fleet-wide Carnival’s C02 emissions actually peaked in 2011, although the fleet capacity has grown 45% since then. Each new class of Royal Caribbean Group ship is 20% more efficient than its previous class, Liberty said, through use of fuel-saving technologies.
Getting to zero carbon emissions
When Hockings asked how to cut carbon emissions to zero by 2050, cruising’s new goal, Donald said the ultimate answer was either ‘a combination of things, or one big breakthrough,’ such as cold fusion technology. ‘Until then it could be everything from bio-fuels, to fuel cells, to lithium-ion battery technologies. We’re investing in and experimenting with, and others are too, with all of those things because we are on a hard march to get to net-zero emissions.
‘And the reason is simple,’ Donald said. ‘It’s in all of our best interests.’