No menu items!

COSTA RICA'S LEADING ENGLISH LANGUAGE NEWSPAPER

HomeArchiveCarnival to spend $700 million on backup power after mishaps

Carnival to spend $700 million on backup power after mishaps

LOS ANGELES, California – Carnival Corp., the cruise operator beset by mishaps at sea this year, will spend $600 million to $700 million on fire protection and backup systems across its entire 101-ship fleet.

Carnival is installing additional emergency generators and reinforcing shipboard systems to prevent a loss of power like that on its Triumph liner in February, the Miami-based company said a statement Wednesday. The company, the world’s largest cruise operator, will also invest in new fire-prevention, detection and suppression systems.

The Triumph’s engines failed after a fire in February, leaving 3,100 passengers adrift off the Mexican coast for several days without working toilets and electricity. The mishap was the first of at least three incidents this year involving separate ships.

“Safety is our highest priority,” Howard Frank, vice chairman and chief operating officer, said at the company’s annual meeting. “We’ve learned much in the past several years and we continue to learn.”

The company’s 24-ship Carnival Cruise Lines unit is creating a Safety & Reliability Review Board that will include outside experts, the company said. In addition, the company will more than double the capacity of a training facility in the Netherlands to accommodate 7,000 employees a year in bridge and engine-room training.

The spending will probably take place over the next three years, Steven Wieczynski, a Stifel, Nicolaus & Co. analyst, wrote in a research note Wednesday. The company had been spending about $650 million annually on maintenance, he said.

“Without clarity on the capex spending levels, investors couldn’t get comfortable,” write Wieczynski, who recommends buying the shares.

Carnival plans to earmark about $300 million of the spending for its namesake unit, according to the statement. The company had about $2.3 billion in capital spending last year.

The company said this week it will reimburse the government for help responding to accidents aboard the Triumph and Splendor. Sen. Jay Rockefeller, D-W.Va., who heads the Senate Committee on Commerce, Science and Transportation, had asked the company in a March 14 letter whether it would pay $4.2 million in rescue and investigation costs incurred by the Coast Guard and Navy.

“It’s unfortunate that it has taken a series of terrible cruise line failures, and the scrutiny that followed, for Carnival to respond with some improvements for their passengers’ safety,” Rockefeller said in an emailed statement. “I will continue to take a close look at how the cruise industry operates and hold them accountable for the safety and quality that their passengers expect.”

Carnival fell 0.2 percent to $33.23 at the close in New York. The shares have dropped 9.6 percent this year, compared with an 8.8 percent gain for the Standard & Poor’s 500 Index.

© 2013, Bloomberg News

Trending Now

Panama Farmer Receives Land Title After 60-Year Wait at Age 109

A 109-year-old Panamanian farmer has received the land title for the property where he lives and works—six decades after first requesting it from the...

Tsunami Alerts in Latin America After 8.8 Quake in Russia

An 8.8-magnitude earthquake struck off Russia’s Far East coast on Wednesday, one of the most powerful quakes ever recorded, triggering tsunamis with waves up...

Venezuelan Migrants Describe Hellish Stay in El Salvador Jail

Mervin Yamarte left Venezuela with his younger brother, hoping for a better life. But after a perilous jungle march, US detention, and long months in...

Why I Choose Real Life in Costa Rica Over the AI Hype

When it comes to AI, call me OG. Old school. I sometimes wish I could go back to a time before it existed. Artificial...

From New Jersey Ponds to Costa Rica’s Mud Turtles: A Wildlife Story

In a weird way, stinky turtles have led to my current life as a guy in Costa Rica working in wildlife monitoring. Up until...

Judicial Corruption Exposed in Costa Rica’s Latest Drug Bust

Costa Rican authorities took down a cocaine smuggling operation Tuesday that moved drugs from South America to the United States, with a judicial worker...
Avatar
spot_img
Costa Rica Coffee Maker Chorreador
Costa Rica Coffee Maker Chorreador
Costa Rica Travel Insurance
Costa Rica Rocking Chait
Costa Rica Travel

Latest News from Costa Rica