Q – As a frequent cruiser, I’ve been on eight of your top-ten rated lines, I am interested in the financials of some of these businesses. It seems to me that it is extremely difficult, with all of the discounting, to really make money in the cruise industry. The new Virgin ships won’t be paid off for many, many years so I’m wondering where the money comes from and how much it really takes to get a venture like that off the ground. Is Richard Branson
A – Much of the financial details concerning investment and profits is shielded from public scrutiny with the exception of the larger, publicly held companies. This has, in recent years, had more to do with outstanding profits rather than the embarrassment of failure. In fact, many analysts are predicting a profit ranges of 8-10% going forward to 2020 when , it is projected, new ship construction will slow.
We don’t know the financial specifics for Virgin. The “street” talk is that it is a total investment of about $800 million with Branson’s Virgin Group putting up approximately $100 of that amount and Bain Capital, Mitt Romney’s former firm, taking on the largest investment share. Virgin is still collecting data from Virgin fans and potential cruisers before releasing firm plans for the design of three 2,800 ships to begin entering service in 2020.
