Pandemic decimates cruise ship orders

Newbuild order trough

Shipbuilders have continued to work steadily through their orderbooks, delaying those close to completion into 2021 and slowing construction of others. They are still ordering engines, thrusters, automation and auxiliary machinery for those cruise ships already well into the construction phase.

According to RINA project manager for newbuildings XL projects Piero Moncheroni, shipyards should now focus on their existing orders as they are unlikely to receive new contracts for at least five years because of the massive industry slump.

He expects operators will not order new cruise ships until at least 2025, when shipyards will be almost empty, and repeat-business options will be ignored.

Mr Moncheroni made these comments in a presentation during Riviera Maritime Media’s Passenger ship projects and deliveries: adapting to a new normal webinar on 25 September. That webinar, held in association with Cruise Ship Interiors Expo, Europe, was part of Riviera’s Passenger Shipping Webinar Week.

Mr Moncheroni explained the dire situation for the cruise industry and those shipyards building new vessels.

“Covid-19 has had a terrible impact on the cruise industry and no one knows the future,” he said. “This has had an impact on newbuilding schedules and orderbooks. Until 2025, we do not expect any new big contracts.”

On the topic of newbuilding projects, Mr Moncheroni said: “Even the ones close to delivery are delayed.” He does not think previously signed orders will be cancelled, “but,” he said, “on the other side, options are not being confirmed.”

“Shipyards should now focus on their existing orders; they are unlikely to receive new contracts for at least five years”

This will have considerable impact on shipyards that have invested in facilities for building cruise ships once their existing orderbook is completed, particularly in Europe and China.

According to BRL Shipping Consultants there are 135 cruise ships on the orderbook, as of mid-November 2020, with 24 ordered so far this year, the vast majority of these in Q1 2020 before the extent of the Covid-19 crisis was known.

This compares with 23 orders in 2019 and 32 in 2018. The orderbook has been stable over the past three years, but as cruise ships are delivered to owners, the global orderbook will diminish. There could be 12-15 cruise ships delivered in 2021, although this number could be swelled by those delayed from this year. As an example, Costa Crociere has pushed delivery of its new Toscana into 2021.

Another 12-15 cruise ships are scheduled to be delivered in 2022; again this could rise if those due in 2021 are pushed back a year. For example, Disney Cruise Line confirmed an adjusted delivery schedule for its Disney Wish, now debuting in 2022.

There could be around 15 cruise ships delivered in 2023, but less than 10 in 2024 and another eight or so in 2025. But deliveries in these latter years could be increased by delayed orders, or drop if owners decide to backtrack on stillborn projects.

Ship upgrades

With a large portion of the cruise ship fleet laid up there is little demand for ship repairs either, although recommissioning work and interior design changes may increase as operators attempt to return to business.

Mr Moncheroni said cruise lines will consider reducing passenger numbers on ships; ne noted there could be “potential increases in demand for ships with reduced passenger-carrying capacity”. Perhaps there could be a maximum of 2,000-2,500 passengers on ships? This would affect interior design and allow increased crew space, necessary “due to the possible limitation on crew movement ashore and the extended length of their contracts” said Mr Moncheroni.

He said design changes could include increased onboard hospital facilities, isolation areas and expanded onboard networks for IT applications. “HVAC design and arrangements will change, with advanced filtering, no recirculating and containment capabilities,” said Mr Moncheroni.

“New standards for materials are to be implemented in the marine industries and regulation,” he added.

These changes could be extensive on newbuildings, where construction has only recently commenced. They will be less extensive on existing ships or those newbuildings close to delivery.

“These design trends will be applied to the repair and refurbishment of ships on a less extensive level,” Mr Moncheroni said. “We do not expect huge modifications to the design of current newbuildings where construction has started,” he added.

Recent ship deliveries include Enchanted Princess to Princess Cruises, Saga’s Spirit of Adventure, World Voyager expedition cruise ship for Nicko Cruises and Silver Moon luxury cruise ship for Silverseas.

Enchanted Princess was Fincantieri’s 100th cruise ship built in the past 30 years and the first delivered since the Covid outbreak. This 145,000-gt vessel can accommodate 4,610 passengers in 1,830 cabins and 1,411 crew. In 2021, the Monfalcone shipyard is scheduled to deliver the sixth vessel in the Royal class, Discovery Princess.

Princess Cruises’ next series of cruise ships will be larger, at 175,000 gt and 5,300 passengers. They will be the first in Princess Cruises’ fleet to be powered by dual-fuel engines, capable of burning marine gasoil and LNG. The ships are scheduled for delivery from Q4 2023 to Q2 2025.

P&O took delivery of 184,000-gt, LNG-powered Iona from Germany’s Meyer Werft in Q4 2020. This RINA-classed ship can accommodate 5,206 passengers. It has an overall length of 344.5 m, beam of 42 m and 2,614 passenger cabins. Another Meyer Group shipyard, Neptun Werft in Rostock, Germany, manufactured Iona’s engineroom unit which contain the LNG fuel tanks. Iona’s sister vessel could be delivered in 2022.

Cruise ship orderbook and orders

Against the grain

Bucking the general trend is Swan Hellenic, which has ordered a third Vega-class expedition cruise ship from the Helsinki Shipyard in Finland.

This vessel will be larger than its sister ships, accommodating 192 guests in 96 cabins and suites. It will be a Polar Class 6 cruise ship, able to operate in medium first-year ice during voyages.

Swan Hellenic said the ship will feature a 4.6-MW diesel-electric hybrid propulsion system with a 3-MW battery package, enabling it to sail under battery power alone for short periods.

Construction could follow a fast-track schedule, ready for delivery before the end of 2022.

Helsinki Shipyard is also making progress on other Swan Hellenic ships; it laid the keel on SH Minerva in September and the main engines were lifted onto the keel in October. The vessel will have four medium-speed and IMO Polar Code category A engines.

“Covid-19 has had a terrible impact on the cruise industry”

SH Minerva is scheduled for delivery in November 2021 and its sister ship in April 2022. These ships will have capacity for 152 guests.

Windstar Cruises is also going against the grain with a US$250M fleet modernisation programme, including considerable expansion of its ships. Fincantieri Palermo redelivered the first of these stretched cruise ships in November.

It extended Star Breeze from a 134 m, 10,000 gt vessel with a passenger capacity of 212, to 160-m, 13,000-gt, 312-passenger ship. This involved the installation of a 25.6-m mid-body section; two 12-cylinder Wärtsilä 26 propulsion engines and two eight-cylinder Wärtsilä 26 inline diesel generators, plus new cabins and suites.

Star Breeze is scheduled to re-enter service in March 2021. Its sister vessels, Star Legend and Star Pride, are getting similar makeovers at Fincantieri, with Star Pride due to be completed in July 2021.

For ongoing newbuild projects, Fincantieri placed a US$150M order with ABB to supply Azipod propulsion systems, including the most powerful to be installed at the shipyard.

ABB will supply twin Azipod units for five cruise ship newbuilds, which are scheduled to enter service between 2023 and 2026. These will have total ordered propulsion power of 178 MW, including Azipods rated at 20 MW each.

Each cruise ship newbuild will also feature ABB’s integrated electric power plant setup, encompassing generators, drives, switchboards, propulsion transformers and a remote-control system to manoeuvre the Azipod units from the bridge.

Major shipbuilders with cruise ship orders

Fincantieri is the current leader in cruise ship newbuildings, with 36 ships on its orderbook, according to BRL Shipping Consultants. These stem from majors such as MSC Cruises, Carnival and Norwegian Cruise Line. It also has orders from Oceania Cruises, Princess Cruises, Silverseas, Tui Cruises, Viking Ocean Cruises and Virgin Cruises. Its shipyards are full to 2025 with ship orders.

Chantiers de l’Atlantique is another important builder with a large orderbook. It is constructing cruise ships for Celebrity Cruises, MSC and Royal Caribbean Cruises, with deliveries to 2025.

Meyer Group is another major cruise ship builder with activity at two yards, one in Germany and the other in Finland. It has orders from major liners, including Aida Cruises, Carnival Cruises and Royal Caribbean Cruises; there are also orders from Costa Crociere, Disney, Silverseas and Tui Cruises on its books.

MSC Cruises is a clear leader in cruise ship investment with a massive 12 on order, according to BRL. Viking Ocean Cruises is a close second, with 10 ships on order. Both Royal Caribbean Cruises and Norwegian Cruise Line have six cruise ships on order each and Carnival Cruises/Group has five on order, although other brands in the group have contracted shipyards for vessels.