Turning a new page

With its announcement that it has signed letters of intent for a further five newbuildings P&O has also altered shipbuilding’s future. Although the order itself is significant, of greater importance is that Japan’s Mitsubishi Heavy Industries will build two of the newbuildings.

While P&O argues that the development is entirely logical — it has been forecast for some time — it will also come as a blow to European shipbuilders. P&O notes that a prime factor was the lack of price flexibility with European yards. It attributes this to the introduction of the Euro, resulting in similar price quotes from all European builders. There is a distinct price advantage in placing the order in Japan.

Of equal importance to P&O was the lack of berth availability. It accepts that this does not apply to Masa-Yards. However, the continuing uncertainty over the future of the Finnish shipbuilder, combined with its close association with P&O’s competitors, meant that it was not a viable alternative.

The result is that MHI has been given a prime chance to prove itself as a builder of high value cruise ships.

Indeed P&O has given MHI a blank sheet as far as the design of the newbuildings goes. Although they will be 110,000g all other design parameters are open. For this reason the contract will take longer to conclude’ but P&O anticipates that it will be signed before the end of the year. Even aspects such as Grand Princess’s distinctive suspended disco at the aft end will not necessarily feature on the new ships. Propulsion also remains an open option for the moment.

Comments P&O: “MHI is a first class yard with excellent design capabilities.” While P&O has confidence in MHI it does not believe that the trend to build cruise ships in the Far East will necessarily spread to other yards in Japan. It thinks that other yards in Japan have downsized to the point where they would be unable to meet the challenge, especially from a design perspective. It thinks that Korean yards are not yet ready to meet this particular newbuilding challenge.

Traditionally, European shipbuilders have argued that Far East builders would be unable to handle the costly interior design work. P&O says that MHI’s tie up with Tokyo’s Hotel Okura means that it is confident about this aspect. It adds that the ship will use Japanese sources for all material and equipment.

Fincantieri has also benefited from P&O’s spree. It will build a further repeat of the 110,000g Grand Princess. Unlike the other ships in the class built at Fincantieri this ship will be operated by P&O Cruises rather than Princess Cruises. This will mean a marked change in the interior design since Princess has a different operating philosophy. P&O says that this will be the first mega-ship specifically deployed for fly/cruise holidays.

The third yard to benefit is France’s Chantiers de l’Atlantique. It is looking to build two 88,000g ships.