Carnival offers a boatload of fun. The company is the world's #1 cruise operator, boasting about a dozen cruise lines and about 100 ships with a total passenger capacity of more than 190,000. Carnival operates in North America primarily through its Princess Cruise Line, Holland America, and Seabourn luxury cruise brand, as well as its flagship Carnival Cruise Lines unit. Brands such as AIDA, P&O Cruises, and Costa Cruises offer services to passengers in Europe, and the Cunard Line runs luxury trans-Atlantic liners. Carnival operates as a dual-listed company with UK-based Carnival plc, forming a single enterprise under a unified executive team.
Carnival maintains its top position in the industry by leveraging its cruise lines to penetrate a number of different markets. Carnival Cruises, a leading brand in the US, and Princess both target families, retirees, and other upper middle class customers with competitively priced cruise packages. Its popular destinations include the Caribbean, the Mexican Riviera, and Alaska. P&O Cruises chases after a similar target customer in the UK with trips to the Mediterranean and Scandinavia. (P&O also operates out of Australia and New Zealand.) Holland America is known for its scenic getaways in New England, Canada, and along the Pacific coast. The company offers trips within the Asian market through its Costa Cruises. The line serves cruise-goers with Chinese-style food, mah-jongg tables in its casino, and luxury brands in its retail shops.
While Carnival has been known as the Fun Ship, the cruiser also attracts those looking for a fine ship. Carnival's Seabourn brand operates luxury cruises to upscale travelers and caters to them with fine food, personalized service, and exotic destinations worldwide. Similarly, its Swan Hellenic premium brand sails throughout Europe and Asia. Of course, luxury is the name of the game for Cunard, which provides a variety of cruises in addition to its liner services.
Despite fears of terrorism during the past few years and a wavering global economy, the company has been growing at full steam since its $5.4 billion acquisition of UK-based rival P&O Princess in 2003. The mega deal boosted Carnival's presence in the UK and throughout Europe and put it leagues ahead of rival cruising company Royal Caribbean. Indeed, its European brands accounted for 39% of the company's total capacity in 2010. The cruise firm is counting on Europe, as well as Australia, New Zealand, Asia, and South America, for future growth, as it believes these markets are relatively untapped. In North America, however, Carnival has seen its sales revenue take a dive to 52% in 2010 from 55% in 2008.
Fueled by optimism for the future, Carnival has orders in place for more than a dozen additional cruise ships, which it will integrate into its fleet by 2012. A 2007 addition to Cunard's fleet, the $470 million Queen Victoria, has proven to be popular. In response to high early bookings for Queen Victoria, Carnival inked a deal with Italy's state-owned shipbuilder Fincantieri in 2007 for a 2,092-passenger liner (to be christened Queen Elizabeth) that launched in late 2010. To make room for its new order of cruise ships, in November 2008 Carnival sold Cunard's 40-year-old Queen Elizabeth 2 to Dubai-based Istithmar for about $100 million. State-owned Istithmar, part of Dubai World, plans to convert the ship into a first-class hotel berthed off the coast of Dubai or South Africa.
Carnival has united with others to expand its portfolio of ships, as well. The cruise operator entered a partnership with leading Spanish travel firm Orizonia in 2007 to form Ibero Cruises. The newer cruise line features a handful of Spanish ships sailing from Spain and Brazil.
To fill its expanding inventory of passenger berths, Carnival continues to spend heavily on marketing its cruises, especially to consumers who have never taken to the high seas. While it relies on the traditional mediums, such as television and magazines, Carnival since 2009 has been shifting its efforts from print media to online and social media, utilizing Facebook, YouTube, Twitter, Flickr, and Podcasts. Its goal is to engage in two-way conversations with consumers and create brand fans. Also, the company has expanded its number of homeports to put cruising possibilities closer to customers. Effective 2011, Carnival operates from 15 North American homeports.
Carnival became a dual listed company after its acquisition of P&O Princess, which was then recast as Carnival plc. The dual-listing structure gives Carnival access to capital markets in both the US and the UK.
CEO Micky Arison and his family own about 35% of Carnival Corporation and control a 27% voting stake in the combined entity that consists of Carnival Corporation and Carnival plc. Arison, one of the wealthiest people in Miami, also owns the Miami Heat basketball team.