Carnival Corporation expects to reduce its current fleet capacity by nearly nine per cent, as the cruise giant looks to further accelerate the removal of ships to help stay afloat amid the COVID-19 pandemic.
In a business update issued late last week, Carnival said it had sold one ship during June 2020, and has agreements for the disposal of five ships and preliminary agreements for an additional three ships, all of which are expected to leave the fleet in the next 90 days.
These agreements are in addition to the sale of four ships, which were announced prior to the 2020 fiscal year.
“In total, the 13 ships expected to leave the fleet represent a nearly nine per cent reduction in current capacity,” Carnival said.
“The company currently expects only five of the nine ships originally scheduled for delivery in fiscal 2020 and fiscal 2021 will be delivered prior to the end of fiscal year 2021.
“In addition, the company expects later deliveries of ships originally scheduled for fiscal 2022 and 2023.”
Carnival noted in its update that the company reduced its new-build capital expenditures by US$1.3 billion ($1.9 bilion) for 2020 and expects to reduce its new-build capital expenditures by over US$600 million ($864.8 million) for 2020.
Additionally, since March, Carnival said it has raised over US$10 billion ($14.4 billion) through a series of financing transactions.
Furthermore, the company has US$8.8 billion ($12.7 billion) of committed export credit facilities that are available to fund ship deliveries originally planned through 2023.
Despite substantially reduced marketing and selling spend, Carnival said it continues to see demand from new bookings for 2021.
For the most recent booking period (the first three weeks in June 2020), almost 60 per cent of 2021 bookings were new ones. The remaining 2021 booking volumes resulted from guests applying their future cruise credits to specific future cruises.
Featured image source: Carnival