Growing Pains and Growing Gains
The State of the Cruise Ship Docks

March 1st, 2010
by Jennifer Mathews

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Honduran National President Pepe Lobo, center, Carnival Senior Vice President for Port Development Giora Israel, right, and Mahogany Investing Partner Jerry D. Hynds, left, ceremoniously open the cruise ship dock on February 10.

Honduran National President Pepe Lobo, center, Carnival Senior Vice President for Port Development Giora Israel, right, and Mahogany Investing Partner Jerry D. Hynds, left, ceremoniously open the cruise ship dock on February 10.

The inauguration of the Mahogany Bay cruise ship dock on February 10 brought international attention as major political figureheads of Honduras gathered to honor the grand opening of the cruise ship dock, including President Pepe Lobo, Roatan mayor Julio Galindo, investing partner Jerry Hynes, and Carnival Corporation Senior Vice President of Port Development Giorra Israel, Guanaja mayor Richmond Hurlston, and Santos Guardiola mayor Perry Bodden, among others.

The beginning months of the Dixon Cove cruise ship dock have not been without challenges. The initial opening date was postponed because weather conditions delayed completion of the dredging in the channel. Dredging continues and, according to Jennifer de la Cruz, Director of Public Relations for Carnival Corporation, “We are still finishing the dredging and channel alignment works which will take a few more months for completion.”

Rumors circulated the internet blogs about the Carnival Legend scraping the bottom on the reef just days after the inauguration, causing damage that led to the Legend arriving in Tampa, FL, hours late. According to blogs, the boat listed when it turned east leaving the channel, a move that Carnival general manager Mike Reimers reported is normal. The Legend skipped its scheduled stop on one voyage at Grand Cayman, visiting Cozumel instead. According to Carnival officials, the Legend’s propulsion problem was electrical and was fixed. The Legend resumed its normal schedule, actually arriving back in Mahogany Bay the next week, a day early. The ship runs year-round, seven-day voyages, originating from Tampa, and calling at Grand Cayman, Cozumel, Belize and Roatan.

According to Alvaro A. Durón, General Manager for Royal Caribbean Port of Roatan in Coxen Hole, Port of Roatan had received nine ships by the time of writing that were rerouted from Mahogany Bay due to wind conditions. According to Carnival’s de la Cruz, “It is always at the captain’s discretion as to whether it is safe to dock at any given port based on sea and wind conditions. The desire is always to dock at the scheduled facility. However, if a captain determines it is not advisable to do so, then alternative plans are enacted.” Since all Carnival ships docked at the Port of Roatan in Coxen Hole until the opening of the Mahogany Bay facility, “the captains know their way around,” said Durón. The Port of Roatan is open to all ships and Carnival ships are welcome. “The ships are good for the island and we’re glad the island has the option of an alternative dock,” said Durón. Such an event, however does create a difficult scramble in organizing the transportation systems (which can be up to 200 vehicles) last minute, but can be accomplished in about one hour. Port of Roatan fees are based on concessions, costing $725 per passenger, up to 33% of which goes to the government as taxes.

The opening of the Mahogany Bay cruise ship dock drastically changed the numbers of traffic to the Port of Roatan with Carnival lines now going to Mahogany Bay. The amount of scheduled ships to Port of Roatan was reduced from 167 in 2009 to 88 in 2010. “2010 is a transition year,” said Durón, allowing the port to begin construction on Phase II of their construction and expansion plans. Awaiting environmental permits delayed progress in 2009, but upon receiving licenses in December, Phase II began “the next day,” according to Durón. The first portion underway is the 53.6 meter expansion of the dock and installation of five new dolphin anchor stations. The entire project is scheduled to be completed in July 2010, in time to receive the Norwegian Epic, one of the fleet’s larger ships, on its first arrival on July 27. Royal Caribbean is reputed for having the largest cruise ships in the world.

Following the dock expansion, the port will begin on the commercial development portion and a hotel. Phase I commercial area was at 85% occupancy at the time of writing. According to Durón, all retail spaces are slated to be open by the time construction on Phase II begins. As the smaller, less expensive retail spaces and kiosks are in high demand, the port is considering plans to set up more opportunities for smaller businesses.

Carnival’s expectations of bringing 500,000 passengers in 2010 are on track, according to de la Cruz, who anticipates that 65% of all cruise passenger traffic to Roatan in 2010 will be courtesy of Carnival Corporation brands.

The Florida Caribbean Cruise Association released its 2008/2009 economic impact study report in October 2009, revealing statistics about the initial year of Roatan’s cruise ship industry in Port of Roatan. Of the 15 lines under the association, seven are associated with Carnival. The report (taken from surveys) showed that 97% of passengers cruising to Roatan are residents of the United States and Canada. The average age of respondents was 47 years of age and broken down to the following categories – Under 15 years of age: 8%, 15-24 years old: 6%, 25-44 years old: 21%, 45-64 years old: 45%, over 64 years old: 20%. Approximately 43% of passengers had a household income of more than $100,000. Average expenditure per passenger was calculated at $70.39, with crew expenditures reaching $58.66 per crew member. Of passengers to return for land-based or resort vacation within the next three years, 57.5% said likely, 42.5% not likely. The study placed Honduras ranking high on the charts, fifth, under Cozumel, Bahamas, US Virgin islands, and Cabo San Lucas. All figures were from the twelve months beginning in May, 2008, ending in April, 2009. [/private]

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