CBR Odo Commentary - Curtain descends on German one ship operators

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Written by Kari Reinikainen Kari Reinikainen

Category: Top Headlines Top Headlines

Published: 03 January 2015 03 January 2015

Peter Deilmann Reederi, operator of the luxury market cruise liner Deutschland became the third one ship cruise operator in Germany to go out of business in the past 18 months. Both cost and revenue related matters have led to their demise.

In brief, a one ship operation means that all shore based expenses are related to the one ship only; it does not require double the number of office staff to run two vessels instead of two or three.

One ship can only be in one place at a time. This severely limits itinerary planning and it has been particularly damaging to the three German companies in particular as they have been destination-focused operators.

Expansion of larger companies, such as TUI Cruises and Aida Cruises, parts of the Royal Caribbean Cruises Ltd. (RCCL) and Carnival Corp & plc group respectively, has furher added to the woes of the one ship operators by drawing customer focus on larger, modern ships.

The two other companies that left the scene Ambient Kreuzfahrten in Berlin, which introduced the Portuguese owned Azores on the German market. However, sales targets were not met and the company was forced to close its doors, and Passat Kreuzfahrten, whose mid-1970s built Delfin also failed to generate enough revenues to keep the operator afloat.

Deilmann's Deutschland was built in 1998 and it targets the affluent, upper end of the German market. Unfortunately, the ship only has rather few balcony cabins, which puts it in a disadvantage in competition with other vessels aimed at the same market segment.

Deilmann's problems came to the surface in the summer, when its joint managing directors resigned after reporting that the planned sales targets for 2014 would not be met. In the autumn, MS „Deutschland“ Beteiligungsgesellschaft mbH, which owns the ship, sought debt restructuring under court protection, but these attempts ultimately failed.

The ship was put up for sale in the autumn and according to Suddeutsche Zeitung, the Munich based daily, only one strategic potential buyer emerged. This was FTI, the Munich based tour operator, which reportedly offered €1 for the ship. However, the report did not say whether FTI would have assumed liabilities of the ship owning company, which amount to about €60 million, in the process.

FTI already operates the 9,870 gross ton Berlin - which started life as a Deilmann ship in 1980 - and it is one of the very few remaining one ship cruise operators in Germany. The cruise ship business is, however, only part of its wider tour operation activity.

Transocean Cruises, now part of the UK based Cruise & Maritime Voyages (CMV) group, operates the 20,606 gross ton Astor on the German market for about six months per year. However, CMV that will soon have seven ships operates the vessel in Australia and the UK for the rest part of each year.

Court opens MS Deutschland and Peter Deilmann bankruptcy proceedings

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Written by Kari Reinikainen Kari Reinikainen

Category: Top Headlines Top Headlines

Published: 03 January 2015 03 January 2015

A court in Eutin in Germany has started bankruptcy proceedings of MS „Deutschland“ Beteiligungsgesellschaft mbH, which owns the 22,496 gross ton cruise liner Deutschland and Peter Deilmann Reederei, the company that has operated the vessel, Deilmann said in a statement.

Meanwhile a world cruise of Deutschland that was due to operate from 18 December 2014 to 1 May 2015 had been cancelled in the absence of a buyer for the vessel that would have provided working capital for the cruise to take place, the company said in a separate statement on 27 November.

Liabilities of the ship owning company amount to about €60 million and those of the operator to about €2 million. The companies have about 1,500 creditors and the first meeting of them will take place on 20 February at the Eutin court house, Deilmann said.