Orla O’Sullivan talks to Peter Fetten, SVP of refits of Carnival Corporation, about the challenge of refitting ships that meet market expectations and changing demographic trends.
When Peter Fetten joined Carnival Corporation as senior vice president of refits, this newly created role was the latest step in his already impressive career. With 30 years’ maritime experience, he has held a similar role at RCCL and positions with Blohm + Voss Shipyard, Barthels & Luders and his own consulting firm.
Having joined Carnival last year, Fetten sees himself as head of a service utility for the world’s biggest cruise operator, mediating between brands and instituting best practices across the company. When asked which of these aspects is more important, he replies, "Both".
For example, as a mediator in a sale, Fetten says he might arbitrate between the seller and buyer on what is a reasonable cost and length of time for a ship to migrate from one brand to another, although this is not always plain sailing.
"Sometimes we criticise, sometimes we are being criticised," he notes with a laugh. "My function is related to support. We help individual lines with whatever demands they have. Our function is going from the idea to the execution."
The degree of change could be from what he calls "revitalisation" or "enhancing what is already there" to a major structural conversion, such as lengthening a ship, adding a superstructure or moving decks around. Fetten’s main team comprises six architects, designers and technicians. He also has access to a large corporate newbuilding group, and similar groups within some Carnival cruise brands that have their own heads of refitting. "However, we should not take away the responsibility of the individual lines," Fetten emphasises.
Rather, he sees himself and his group as defining processes and reinforcing success by analysing what has worked best across the entire fleet. Without such a conscious effort to institute best practice, a lot of individual knowledge may not be communicated.
"Most of the job is defining the right designs and the right people for the task," Fetten says. "We don’t have a formal database where you put in a profile and it pops out a name, but we keep a huge database on the latest performance statistics in the cruise industry."
This data includes information on shipyard and contractor selection and pricing. Fetten is adept at analysing data to achieve results. In the 1990s, as head of his own consulting company in his native Germany, he saved upwards of $10m per ship for clients by building in China.
Rate of change
There is no way to be an expert in all aspects of cruise life. "A cruise ship is basically a town," says Fetten. Hence, Carnival draws on a lot of outside partners, working with many of the world’s major retailers, casino and spa operators to stay abreast of current trends. The two biggest trends Fetten sees for the coming decade are an even greater escalation in the speed of refurbishment cycles, and more sophisticated customers.
Customer awareness will see a continuation of the focus on health and wellness, bringing increased dietary options, activities and, notably, spa services on board.
"Historically, a ship was modernised after 25 years; now it’s every ten years," Fetten says. "It’s a constant adaptation to keep ships fresh and in line with the latest building philosophy and trends." Fetten notes there must be balance between the renewal of some ships and ensuring others do not look jaded by comparison, adding that there is a constant recycling within fleets since it takes up to four years for a single refurbishment. The slowest change to make is cabin upgrades, he notes, because there are likely to be somewhere between 1,200 and 1,500 cabins.
Refitting projects can also be deceptive in their intensity. High on the list of time-intensive makeovers are menu changes, which at first thought might seem superficial, however, the increasing culinary sophistication of passengers means that a cruise ship, instead of having one main dining room, must have several.
"If you don’t have a primary speciality restaurant, at least one – even sometimes five or six – it’s possible you’ll lose customers," Fetten says.
A spa-styled restaurant may require juicers and copious amounts of raw food, while a casual dining option, which ten to 15 years ago meant pizza, hamburgers and hot dogs, today also means sushi, tapas, Indian and Mexican.
"It seems easy to change a menu, but this requires hardware changes in the background that nobody sees," he adds.
However, Fetten notes how themed cruises, which have become a recent industry trend, have had less of an impact on refits. In this area, Carnival has hosted a theme cruise based on US rock group Lynyrd Skynyrd, which included live performances by the band.
In Fetten’s experience entertainment-related changes have commanded the least investment from refitting budgets. With the exceptions of the recent trends of big screens and films screened outdoors, entertainment arenas were originally designed to be multipurpose.
By contrast, new itineraries require changes that were not envisioned when traditional routes applied. "For example, ships now might change from sailing in Alaska to a route in the Caribbean," he explains. "In Alaska you need a more closed ship whereas in the Caribbean you need a more open ship. A lot of ships need a lot of adaptations that nobody sees."
That’s not to mention changes required for ships on new cruise routes to Australia, Asia and South America. And with cruising attracting a younger demographic, a new segment is opening up for casual cruises. "Within Carnival Corporation there is the fun ship concept, Holland America for older people and Princess for the baby boomers," says Fetten, who is also aware of the differences between markets.
"Not only is the European market different from the US, but within European countries Spain is completely different to the UK," he says. "The speed of change is increasing year by year. It’s a huge task to take a ship out of service and modernise it in the quickest time possible."
While Fetten is aware that it is his job to ensure that each customer gets to enjoy "a four-or five-star experience", he is also aware that there is no alternative to facing this challenge: "The more you adapt the better you perform."