Carnival will be on the China sidelines for a few years: CEO Weinstein

Costa Cruises ships that led the company's China deployment were withdrawn and are gainfully employed elsewhere, Weinstein told analysts during Monday's second quarter earnings call.

China joint venture

But there was no mention of Carnival Corp.'s joint venture with China State Shipbuilding Corp., whose first newbuild, the 135,500gt Adora Magic City, is due out later this year. It will sail from Shanghai.

A Carnival spokesperson said the company remains a minority stakeholder in the venture, 'which is a separate legal entity belonging to a different ownership structure.'

Name change

Earlier this month, CSSC Carnival Cruise Shipping, founded in 2018, changed its name to Adora Cruises.

Chairman Yang Guobing said: 'After years of development, Adora Cruises Limited has become an independent and full-functioning cruise company and has its own brand. We are getting well prepared in sales and marketing, product and hotel management and maritime operation.'

Costa Mediterranea and Atlantica

Of the two Costa ships that were also put into the joint venture, the former Costa Mediterranea, 86,000gt, is to begin sailing later this year on international cruises from Tianjin. The 2003-built ship will be operated by Adora Cruises as Mediterranea following a refurbishment bringing new livery, upgrades and adaptations for Chinese passengers.

As for the 2000-built Costa Atlantica, based in Europe for months and currently sailing in the Tyrrhenian Sea off Italy, an Adora spokesperson told Seatrade Cruise News its operation plan is still under discussion and will be released later.

She added that the name change from CSSC Carnival Cruise Shipping to Adora Cruises didn't involve a change in ownership structure, board or management team.

Costa ships embraced by Carnival customers

Meanwhile, three ships from Costa, Carnival Corp.'s pre-pandemic China platform, were assigned to Carnival Cruise Line — two for 'Carnival Fun Italian Style,' which Weinstein said has 'gone fantastic,' adding that customers' embrace of the concept has exceeded expectations. 

Carnival Venezia, one of three Costa ships transferred to Carnival Cruise Line

Carnival Venezia's introduction this month was an 'instant success' and supports the upcoming transfer of Carnival Firenze, Weinstein said. Carnival (ex Costa) Luminosa, meanwhile, not part of the 'Italian Style' branding, splits its year between Alaska and Brisbane, Australia.

Carnival brand one-third of company's capacity and generates highest returns

These ship moves result in Carnival Cruise Line capacity growing 22% more than pre-pandemic plans and Costa's capacity 36% reduced.

Thanks to reallocated assets, Carnival Cruise Line — the company's highest returning brand along with AIDA Cruises and P&O Cruises — now comprises about one-third of Carnival Corp. capacity, up from 25% pre-pandemic.

Weinstein said the Carnival brand is generating 'outsized returns' for the company while 'right-sizing' Costa is supporting its improved revenue profile, with European brands' bookings taken this past quarter for second half 2023 sailings for European deployments achieving double digit percentage increases in both volume and price compared to 2019.

Happy for China reopening but ships yielding more elsewhere

The Carnival chief said the company's assets are 'in a good place, and they're yielding more than they would had we stayed the course, I believe. So, we're very excited about China opening up for international travel with cruise companies, and we think that's a great thing for the industry.

'But the fact is we're going to be probably on the sidelines of that for a few years because our assets are right where we want them to be.'