Terry Thornton, Senior Vice President of Carnival Cruise Line.
Carnival Cruise Line's (CCL) return to the Virgin Islands hinges on berthing conditions as the company is not prepared to go through Norwegian Cruise Line (NCL) and Disney Cruise Line (DCL) for permission to berth at the Road Town Cruise Pier.
On Tuesday, October 15, CCL took the decision to cancel bookings to Tortola from about July 2014 through to 2016.
Government has since said they are expecting to sign berthing agreements with DCL and NCL which could see other cruise lines having to enter into negotiations with the two companies to berth in Road Town. Hence, Government stated that it could not confirm CCL's bookings beyond the 2013/2014 season.
In an exclusive interview with BVI Platinum News, CCL's Senior Vice President, Mr. Terry Thornton rejected the suggestion of having to go through NCL and DCL.
"We have not been told that directly by Government. We have read that same information from Government in the media. I could tell you very specifically there is no circumstance where Carnival Cruise Lines will work through Disney and NCL to make berth reservations in Tortola. That would not happen," said Mr. Thornton.
Asked about Tortola bookings beyond 2016, he replied, "It's hard for me to say yes or no to that because I don't know what the process will be in order to confirm berths for 2016, 17 or 18. If the process to confirm berths requires me to go to NCL and Disney, then we will not be making calls to Tortola for 2016, 17 and 18. If the process is different and accessible to us, we will consider it."
Mr. Thornton explained that CCL and a number of other cruise lines are part of the Carnival Corporation which is responsible for some 70% of the cruise business to the BVI for 2013/2014.
As for 2014/2015, Mr. Thornton said that CCL would have been responsible for 100% of the calls from Carnival Corporation.
He noted that CCL has since shared their recent decision with other cruise lines under the Carnival Corporation.
"We have shared what we have decided to do with all of the sister cruise lines with Carnival Corporation and each of the cruise lines is now evaluating that information and the response that they are getting from the BVI Government and they will be making their own independent decision about their calls for 2014 and 2015," Mr. Thornton said.
Government contends that under the berth agreements with NCL and DCL, the Territory is guaranteed over 400,000 passengers with a head tax of $15. Additionally, under the agreements, once the companies fail to deliver passengers as promised, then they are required to pay the head tax.
Minister for Communications and Works, Hon. Mark Vanterpool told BVI Platinum News that the agreements with DCL and NCL have not been signed, but Government expects the two cruise lines to fill the void left by Carnival.
Mr. Thornton commented that a passenger commitment is one thing and the port revenues that go with that is one thing.
"Let's say the other cruise lines involved don't bring the number of people that are in the commitment, yes the ports will receive the revenue, but all of the local vendors...the tour operators, the restaurants, all the people that benefit from the passenger spend will not be benefiting from those calls...," Mr. Thornton stated.
Government Promised 2014/2015
Mr. Thornton said that Carnival's decision to cancel service to Tortola was partly due to the Government undertaking a very large project on the current berth and CCL understands it's a combination of maintenance work as well as some improvements.
He stated that this requires ships to move to anchorage instead of docking at the pier, but the company felt that this would not be a very good experience for guests.
"It takes significant amount of time away from their tour of the destination. We run the risk of missing the call due to bad weather. This was not an acceptable position for us to move to anchorage and the Government had already asked us to move one of our ships to anchorage in 2014," Mr. Thornton explained.
He revealed that Carnival had already gotten approval from local authorities to berth in 2015 and the company had started selling tours up to April 2015.
It was noted that the passengers who have already booked cruises that stop in Tortola from June 18, 2014 to April 30, 2015 are being notified about alternative ports. Ships affected include Sunshine, Freedom, Liberty, Glory and Valor.
"We asked the Government and the Ports [Authority] for our 2015 calls; if they can simply re-confirm what they had already confirmed to us as berth reservations. All we wanted to know was could they re-confirm our berth reservations that we had already made. The port and the Government came back and advised us that they could not re-confirm our previously scheduled calls into Tortola at this time," Mr. Thornton stated.
He added, "With our 2015 calls, that left us with complete uncertainty whether we were going to be able to operate those calls at all. Given that those cruises were open for sale to our customers, we had to make a decision to cancel their calls to Tortola and offer an alternative port so at least our guests would know with certainty what ports of call they were going to be able to visit on the cruises they were buying."
According to Mr. Thornton, the company has been successful in finding alternative ports and is in the process of advising all the people that have already booked the cruises about the change.
"This is not going to be a very good experience for the people who have booked. They had booked thinking they were going to be able to visit Tortola on these cruises and now in fact they wouldn't be able to do that. I am sure there are going to be some of the guests who will be upset with that," Mr. Thornton noted.
He questioned Government's intention towards the company which has been serving the Territory for over a decade and has increased arrivals to the Territory since 2010.
Expected guests figures for the next 3 years was said to be over 100,000.
"What was confusing to us is why would the Government take a position that would limit our ability to call on Tortola when we were by far the largest supporters of business to Tortola. We could not understand that and we can't speculate as to why that is," he stated.
"A sizable number of guests will be impacted by this change. In numbers to us, from a reputation standpoint, if we had 10 persons on a cruise it is still something that we sold to them with what we thought was a confirmed berth in Tortola that we now wouldn't be able to deliver. It's not a very good situation for Carnival Cruise Line," Mr. Thornton noted.
He said the company does not foresee having to resort to legal action as they are mostly focused on doing the right thing for guests by managing the transition.
"We have been talking with Government for over a month, trying to figure out how we can work this out; how they can give us the reassurances we need for the calls and we have done everything we can to try to maintain the calls that we ended up having to cancel for 2014 and 15. We really did not want to make this decision and we really tried really very hard to work with the Government to see if there was away to do that. It is a very unfortunate outcome, but I want you to know that we really very much tried for over a month to avoid what was this ultimate decision".
Mr. Thornton was asked about suggestions that CCL attracts low end spenders, but he explained that the company has been making calls to the BVI for a number of years and has never been told by Government or by any of the local operators that they have been disappointed with the on island spending of guests.
"I can't say that I have ever been advised of that. What is always true with Carnival Cruise Line is we deliver the line of guests that we have on our ship very consistently. Our ships are always full; we carry what we would consider a very viable customer for the BVI. I have never been advised that any of the local businesses have been disappointed by the level of spend that our guests bring to the BVI," Mr. Thornton stated.
Article Published October 15, 2013 - Carnival Cruise Line Pulls Out
Days after local officials shared mixed views about cruise tourism, Carnival Cruise Line has delivered a bombshell, pulling out of the BVI for the cruise seasons between 2014 and 2016.
BVI Platinum News understands that the Government and Carnival had been in intense meetings, but by yesterday, October 15, the company took the decision to cancel some 60 planned port calls to the Territory.
When contacted, Hon. Mark Vanterpool, Minister of Communications and Works stated that the BVI Ports Authority (BVIPA) had informed Carnival that they could not confirm available dates for the 2015/2016 season.
He explained that this was done because of ongoing negotiations involving Government, Disney Cruise Line (DCL) and Norwegian Cruise Line (NCL) to finalize berthing agreements.
According to Hon. Vanterpool, the berthing agreements with DCL and NCL will guarantee 450,000 passengers with a head tax of $15.
He stated that once the agreements have been finalized, it is expected that NCL will deliver port calls for 52 weeks starting October 2014 and DCL will deliver port calls for 24 weeks starting January 2015.
Photo Credit: BVI Platinum News
BVI Platinum News understands that once the berthing agreements with DCL and NCL are in place, other cruise lines will access the cruise pier through the two companies.
Asked about this, Minister Vanterpool stated that this is nothing new and is also the case in St. Marten and St. Thomas where Caribbean Cruise Line holds berthing agreements.
"The passengers that we would have lost from Carnival will be replaced by Norwegian and Disney. Because we could not confirm available dates for Carnival, it wouldn't be surprising if they have decided not to come to the BVI. The berthing agreements are the best way to go because the two cruise lines will have to deliver what they have promised and if they don't, then they will have to pay us," Minister Vanterpool stated.
BVI Platinum News further understands that the berthing agreements are dependent on the extension of the Road Town cruise pier since NCL has plans to introduce their larger 4000 capacity cruise ship to the BVI.
Minister Vanterpool stated that the talks with Carnival were cordial and Government intends to maintain their very good relationship with the company.
Just last month, the Minister said he was not going to make any rosy promises for for the 2013/2014 cruise season.
"I believe we are still under that situation where the pier is not being extended; the cruise ship companies have been looking elsewhere until we do our extension to the pier," Hon. Vanterpool had stated.
The BVI Ports Authority had stated that the BVI is expecting 415 cruise calls from this October to September 2014, including some inaugural calls. During 2012-2013, figures for the same time period recorded a total of 402 cruise calls.
According to the Ports Authority, during the last cruise season, BVI was visited by over 359,000 passengers.
Director of the BVI Ports Authority, Mr. Claude Skelton-Cline remains optimistic about cruise tourism.