Carnival Orders Another Cruise Ship from Meyer Werft

German shipbuilder Meyer Werft reports it has secured an order from U.S.-based Carnival Corporation for the construction of a new cruise ship for Carnival Cruise Line. The newbuild order is the first placed by Carnival Corporation in five years.

Slated for delivery in 2027, the Excel-class ship will be a sister vessel to the 183,200 GT Carnival Jubilee, which was handed over at the end of 2023.

"Our Excel-class ships have been a tremendous addition to the Carnival fleet and proven very popular with our guests," said Christine Duffy, president of Carnival Cruise Line. "As the world's most popular cruise line, this new ship enables us to continue the growth of our incredible fleet as we welcome our loyal guests back to cruise more frequently and attract new-to-cruise guests to experience all that a Carnival cruise has to offer."

Josh Weinstein, CEO of Carnival Corporation, said, "Building on our strong performance and growing momentum around the world, we are excited to resume our newbuild program and further enhance our global fleet with yet another state-of-the-art ship that will wow Carnival Cruise Line's guests."

The new ship will be approximately 180,000 GT, around 344 meters long and have space for more than 6,400 passengers. It will be equipped to run on liquefied natural gas (LNG) as fuel.

Since 2018, Meyer Group shipyards Meyer Werft and Meyer Turku, in Finland, have built nine cruise ships with LNG propulsion on a joint technical platform for four cruise lines in the Carnival Corporation portfolio.

"We are very pleased that the partnership between the Meyer Group and Carnival Corporation will continue with this new order," said Bernd Eikens, CEO of Meyer Werft's parent company, the Meyer Group

The order comes amid strong demand for cruising following the lows of the pandemic downturn. Carnival in January said it was off to an "early and robust" start to its wave bookings season, with volumes hitting an all-time high.

"With one newbuild scheduled for delivery in 2025, none for 2026, and this order being our only expected newbuild in 2027, our responsible capital approach will support utilizing our substantial free cash flow over the next several years to strategically improve our balance sheet, significantly reduce our leverage levels and continue to transfer value from debt holders to shareholders," Weinstein said.

"We are following through on our measured capacity growth strategy with the addition of one to two ships per year beginning in 2027, which will be allocated to our cruise lines that most need the capacity to satisfy outsized demand, delivering an attractive payback period. We also remain focused on driving revenue growth throughout our portfolio of world-class cruise lines by continuing to improve execution across all aspects of our operation, yielding higher return on invested capital," Weinstein continued.

Thomas Weigend, chief sales officer of the Meyer Group, said, "This order is a clear sign that the cruise market has recovered and that there is great demand for sea voyages."

Meyer Werft's current order book includes five cruise ships, one research vessel and the steel construction for four offshore converter platforms.