Cruise Line Case

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Case Study: Allure Cruise Line – Challenges of Strategic Growth and Organizational Effectiveness Who are the “major players” in the North American cruise industry? The “major players” in North America cruise industry are, Carnival, P&O Princess (P&OP), RCC and Star Cruises Group accounted for 69% of capacity in 2002. In 2006, with P&O Princess now part of Carnival, the top three reached over than 79%.  In progress the top three “major players” would increase to 81% by 2010. With the emergence of MSC Cruises as a fourth major player which is likely to be placing regular orders from 2010, though, that top three shares is not likely to grow significantly higher by 2015. While Allure Cruise Line is a small North American cruise line, and it currently has three ships in its fleet and is in the process to planning to add new ships and itineraries in the upcoming several years.

What are the business statistics about these “players”? Asset size? Fleet size? Passenger volume? Crew to passenger ratios? Where are they located? Organizational structure? The “major players” in North American cruise industry together they have more than 79% of all.

Carnival is a public company, located in Miami, FL, and founded in 1974 with more than 10,000 employees. Carnival revenue in was about $12,000 (7%) in 2008. Earlier in 2008, it operated 85 cruise ships with 158,352 passenger capacities in North America, Europe, Australia, and New Zealand.

Royal Caribbean Cruises (RCC) is also located in Miami, FL, CA, founded in 1968 by Anders Wilhelmsen & Company shipping company. Currently, RCC has more than 8,500 employees expecting to have annual capacity of 850,000 for next year. RCC had a most successful 2008. Despite an 18% increase in capacity, net revenue yields remained in line with the high levels achieved in 2008 and occupancy increased by 20%. Star Cruise Group is the third largest cruise line in the world, just behind Carnival and Royal companies, and dominates the Asian-Pacific market. Star Cruise Group was founded in 1993 with its company headquarters in Hong Kong. The Group a non-cash Euro denominated debit translation loss of $9.5 million and forward contracts loss of $ 11.3 million. As a result of aforementioned factors, the Group recorded a net loss of $9.0 million for the year ended in 31 of December in 2008, as compared to a net loss of $12.5 million in 2007. Allure Cruise Line was founded in 1993 and during this time has grow to develop a reputation for providing one of the highest quality cruise experiences available. Allure Cruise Line’s three ships have a passenger capacity of 2,500. Each ship has a crew of 1,000 of which 190 are officers on board. The crew represents 40 different countries and nationalities. What are the route structures? Where do they sail to? Carnival has progressed, expanded, and grown into the largest cruise line in the world by carrying more cruise passengers than any other cruise line. The most popular routes form Carnival Company are: Florida to the Bahamas, Hawaii Cruise, New England from New York, Western Caribbean from Florida, and Bahamas from Jacksonville.

Royal Caribbean Cruises now generally the routes take place in a certain area of the Caribbean, visiting the ports of call particular to that region. There are also routes just to one destination, such as Bermuda or the Bahamas, but routes in the Eastern and Southern still being the most interesting for the clients.

The Star Cruise Group is great company that offers over than 200 destinations in the world. They are the leading cruise line group offering routes in Asia-Pacific as: Kuala Lumpur and LangKawi Island (both cities in Malaysia), Phuket Island (Thailand), Singapore and Hong Kong.

Currently, Allure Cruise Line’s ships sail out of Fort Lauderdale, Florida, and have several itineraries within the Caribbean from which passengers can choose, including destinations such San Juan, Puerto Rico, and Nassau,...
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