General presentation of the Carnival Company:
We shall now continue with a review of the Carnival Company’s activities and its different sources of revenue. This will assist you in anticipating the challenges to its future growth.
The Carnival Group is an American company specialised in the cruise ship sector that owns and operates a number of related brands including Carnival Cruise Line, Holland America Line, Princess Cruises, Seabourn, Cunard, AIDA Cruises, Costa Cruises, P & O Cruises and P & O Cruises Australia.
To better understand the group’s activities it is possible to divide them amongst a number of sectors depending on the amount of turnover generated in each way:
- The sale of cruises represents the major part of this company’s activities with 98.1% of its turnover. This particularly relates to the sale of tickets and the optional services available aboard the cruise ships.
- The remaining 1.9% of this company’s turnover is from the sale of holidays in Alaska and Canada through its travel agents Holland America Tours and Princess Tours.
The Carnival group currently operates a fleet of 104 cruise ships with a total capacity of 236,910 passengers.
It can also be advantageous to know the geographical distribution of the Carnival Group’s revenue that is generated as follows: 55.2% of this company’s turnover is from North America, 30.4% in Europe, 12.6% in Australia and Asia and 1.8% from the rest of the world.
Know the competition to the Carnival Group:
Although Carnival is currently one of the international leaders in the cruise sector there are a few serious major competitors to this company that you should monitor closely for your analyses of this company. These are the major competitors to Carnival:
- Marriott International: This American company is also specialised in cruises as well as the hotel sector and mainly exercises its activities in North America and Pacific Asia.
- Royal Caribbean Cruises: This group holds second position worldwide in the cruise ship sector with activities under the following brands: Royal Caribbean International, Celebrity Cruises, Pullmantur Cruises, Azamara Cruises and CDF Croisières de France.
Of course, you should also take into account the indirect competition from other travel companies that do not offer cruises or are small more localised companies.
The strategic alliances implemented by the Carnival Group:
Carnival therefore has some serious competitors on the market but can also count upon certain allies. Here for example is a recent strategic partnership that the group implemented which significantly influenced its stock market share price:
- CSSC: This partnership was implemented by CSSC, the China State Shipbuilding Corporation, with the creation of a joint venture named CSSC Carnival Cruise Shipping. The Chinese Group thereby held the majority of the capital in this joint venture and purchased two cruise ships from Costa capable of transporting 2,000 passengers with the option of ordering other ships that would be built in China. The programme also included two firm purchases from the Shanghai shipyard with an initial delivery in 2023 and an option for two new ships. It should be noted that CSSC also signed concurrently a partnership with the Italian company Fincantieri still with the objective of creating a joint company for the construction of cruise ships which would enable the creation of Chinese cruises.
Of course, it is probable that the Carnival Group implements other strategic partnerships during the coming years and these events should draw your attention and enable you to take strategic positions on volatile and advantageous trends over the short and medium term.