First newbuild for Carnival joint venture in China is halfway complete

The first cruise ship being built for Carnival Corporation’s joint venture with China State Shipbuilding Corporation is halfway complete, with much of her hull and superstructure now assembled.

The unnamed cruise ship will be the first of several planned for CSSC Carnival, which will operate exclusively for the domestic Chinese cruise market, sailing from popular Chinese ports such as Hong Kong, Shanghai and Tianjin.

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Carnival announced the joint venture with CSSC back in 2015 in a move to expand its footprint in the fast-growing Asian cruise market. Several cruise lines have already committed ships to China, including Costa Cruises, Princess Cruises, MSC Cruises, and Royal Caribbean.

Carnival is the first to partner with a domestic firm to build a cruise ship in the country, which will enable it to circumvent a number of restrictions China places on international cruise lines.

While in other global markets cruise lines can sell their voyages retail through travel agents, in China they have to charter their vessels to wholesalers that are then responsible for filling the ships, meaning most of the communication and marketing to customers is out of the cruise company’s control.

By going into a joint venture, Carnival Corp will be able to avoid those restrictions. China has made joint ventures with international companies a key feature of its economic strategy.

By limiting access to its market unless firms partner with a local company, its able to access new technologies and boost local employment. The United States calls this process ‘technology transfer’.

China’s cruise economy, which first opened in 2006, has grown 45 percent on average every year for the last ten years, an estimated 4.5 million Chinese people were expected go on a cruise in 2020 prior to the COVID-19 pandemic.

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By launching a new cruise line through CSSC (one of the ten largest defense contractors in China), Carnival Cruise Line is also continuing its own strategy of having distinct cruise lines for each geographic cruise market it targets.

Carnival Corporations has Costa Cruises for Italy, AIDA Cruises for Germany, P&O Australia for Australia, P&O and Cunard for the UK, and Carnival Cruise Line, Princess Cruises, Holland America Line, and Seabourn for the US and international markets.

The first newbuild for CSSC Carnival is currently known only be her hull number, Hull H1508. She’s being built at the Waigaoqiao Shipyard in Shanghai, and will be the first of two 133,500 gross tons cruise ships based on the Vista-class.

The first is due to be launched in 2023 and will have space for 4,200 passengers. There are plans for at least four additional ships to be built at a later stage.

CSSC Carnival already purchased two cruise ships as a stop-gap while its first newbuilds are being constructed, Costa Atlantica and Costa Mediterranea. Both of which are currently awaiting re-deployment in Dubai.

In recent weeks announcements have been made about more cruise ships that will be built in China, including a 6,500 passenger, 140,000 gross tons vessel that RINA will classify, the Italian ship’s classification agency, which has worked with Carnival Corporation extensively in the past, although no buyer for this vessel has been disclosed so far.