Federal Judge considers sanctions affecting Carnival that could affect cruises

[Thorncroft]

29 minutes ago, cruzincat50 said:

Any fines imposed on CCL will likely end up causing higher cruise fares in the future. It wouldn't be fair to penalize CCL's customers.  Instead there should be investigations in all cases of illegality and jail time imposed on those responsible. If CCL does not assist in the investigation or in firing those responsible, only then should they have to pay a fine.

 

You realize this is a case of probation violation after already being found guilty and paying a $40M fine, previously? Carnival has no recourse but to throw themselves at the mercy of the court, here. You can almost bet there will be a precedent setting fine and who knows what else? 

[cruzincat50]

16 minutes ago, Thorncroft said:

 

You realize this is a case of probation violation after already being found guilty and paying a $40M fine, previously? Carnival has no recourse but to throw themselves at the mercy of the court, here. You can almost bet there will be a precedent setting fine and who knows what else? 

If they deal with the people within the organization that actually committed the infractions, and do so harshly, providing the government with evidence to prosecute them, then they might come out of it, without too much damage.  

[jimbo5544]

29 minutes ago, Thorncroft said:

 

You realize this is a case of probation violation after already being found guilty and paying a $40M fine, previously? Carnival has no recourse but to throw themselves at the mercy of the court, here. You can almost bet there will be a precedent setting fine and who knows what else? 

It makes sense

[broberts]

2 hours ago, cruzincat50 said:

Any fines imposed on CCL will likely end up causing higher cruise fares in the future. It wouldn't be fair to penalize CCL's customers.  Instead there should be investigations in all cases of illegality and jail time imposed on those responsible. If CCL does not assist in the investigation or in firing those responsible, only then should they have to pay a fine.

 

Unfortunately it can be extremely difficult to identify all those responsible for an illegal action. Certainly the generally low level employees that actually commit the transgression can be identified, but those employees above them who created an environment that encouraged, possibly required the action are much more difficult to identify.

 

Even were all of the doers punished, it would not change the basic corporate culture that permitted, possibly encouraged the transgressions. So the problem will more than likely persist. Required is the implementation of carefully considered policies and practices that alter corporate culture and behavior. Putting people in jail is not going to help with this.

 

[ontheweb]

12 hours ago, cruzincat50 said:

Any fines imposed on CCL will likely end up causing higher cruise fares in the future. It wouldn't be fair to penalize CCL's customers.  Instead there should be investigations in all cases of illegality and jail time imposed on those responsible. If CCL does not assist in the investigation or in firing those responsible, only then should they have to pay a fine.

Basically the fares are determined by supply and demand, so I don't know if this will actually have that effect. More likely it will have an effect on corporate profits.

[Keys2Heaven]

29 minutes ago, ontheweb said:

Basically the fares are determined by supply and demand, so I don't know if this will actually have that effect. More likely it will have an effect on corporate profits.

 

True to an extent. If it impacts the bottom line, then my gut tells me that will find its way to the consumer as a higher fare or a cutback.

Edited April 18, 2019 by Keys2Heaven

[mdahmus]

If Carnival was saving money by dumping trash in the oceans, and the other lines were obeying the law and absorbing higher costs, then Carnival's fares having to rise as a result of fines seems like an eminently fair outcome to me.

[ProgRockCruiser]

Here is an interesting bit of math:

 

Revenue for Carnival Corp was almost $19 billion last year, with net income over $3 billion.

 

Carnival Corp was fined $40 million.

 

They have a fleet of 104 (+/-) ships across the fleets.  Let's say 100 available, with four in dry dock somewhere at all times.

 

To "recover" that fine, they would have to earn an extra $400,000 per ship.

 

Lets' say they try to do it over one year, or 365 days.

 

Each day, they would need to generate $1096 per ship.  The ships carry well over 2000 pax per cruise each - maybe there are a few ships with lower capacity, but I am pretty sure we can count on an average of 2000.

 

So fifty cents a day extra from each pax will easily cover the fine.  Yeah, there may be financial games to be played about revenue vs non-expensable fines, but overall, the fine is chump change.

 

Make the fine $400 Million for the latest transgression: if Carnival looks to "recover" it over 5 years through increased fares, it would cost every pax $1 extra per day.

 

Anyway, just thought I'd put some perspective on the numbers being bandied about.

[bowlinmoe]

2 minutes ago, ProgRockCruiser said:

Here is an interesting bit of math:

 

Revenue for Carnival Corp was almost $19 billion last year, with net income over $3 billion.

 

Carnival Corp was fined $40 million.

 

They have a fleet of 104 (+/-) ships across the fleets.  Let's say 100 available, with four in dry dock somewhere at all times.

 

To "recover" that fine, they would have to earn an extra $400,000 per ship.

 

Lets' say they try to do it over one year, or 365 days.

 

Each day, they would need to generate $1096 per ship.  The ships carry well over 2000 pax per cruise each - maybe there are a few ships with lower capacity, but I am pretty sure we can count on an average of 2000.

 

So fifty cents a day extra from each pax will easily cover the fine.  Yeah, there may be financial games to be played about revenue vs non-expensable fines, but overall, the fine is chump change.

 

Make the fine $400 Million for the latest transgression: if Carnival looks to "recover" it over 5 years through increased fares, it would cost every pax $1 extra per day.

 

Anyway, just thought I'd put some perspective on the numbers being bandied about.

Yeah.  It's about how much they make from one game of BINGO. 

 

Carnival will get that money back no problem.

[Aquahound]

1 hour ago, ProgRockCruiser said:

Here is an interesting bit of math:

 

Revenue for Carnival Corp was almost $19 billion last year, with net income over $3 billion.

 

Carnival Corp was fined $40 million.

 

 

There's much more in play that would impact your math.  Don't forget the Environmental Compliance Plan Carnival was made to enact in addition to the $40 million fine.  Part of Carnival's "probation" was to take aggressive environmental actions such as reducing emissions, installing exhaust scrubbers, reducing waste, etc.  These are ongoing efforts that come with a high, recurring price tag.

[jimbo5544]

6 minutes ago, Aquahound said:

 

There's much more in play that would impact your math.  Don't forget the Environmental Compliance Plan Carnival was made to enact in addition to the $40 million fine.  Part of Carnival's "probation" was to take aggressive environmental actions such as reducing emissions, installing exhaust scrubbers, reducing waste, etc.  These are ongoing efforts that come with a high, recurring price tag.

True, but a lot of that is coat of business (scrubbers as an example), paying for cost and salary for a environmental steward on each ship, would be unique (as would a 10 fold increase in fines).   It is a great a ways off, and will be interested to see how it all rolls out, but not a great day in any regards.  

[bury me at sea]

2 hours ago, jimbo5544 said:

True, but a lot of that is coat of business (scrubbers as an example), paying for cost and salary for a environmental steward on each ship, would be unique (as would a 10 fold increase in fines).   It is a great a ways off, and will be interested to see how it all rolls out, but not a great day in any regards.  

 As you, I am waiting to see what will come next.  Do you have an opinion on what should happen for violation of the probationary terms?

 

 

[jimbo5544]

2 minutes ago, bury me at sea said:

 As you, I am waiting to see what will come next.  Do you have an opinion on what should happen for violation of the probationary terms?

 

 

Certainly not an area of expertise (shocker...), I feel less strongly them some here on the punitive aspect (and have no idea on what that dollar amount should be, seems that 10X above the last is right), I do understand some of the emotion expressed by you and others on this.  I have much stronger feelings on what went wrong and what the corrective action should be.  Obviously they are having issues solving the problem(s), and with it being a recurring issue and across many of their lines.  Their efforts to implement solutions while substantive in theory, failed in application.  I am most troubled that the corporation’s size and complexity appears to have impacted their ability to do what needed to be done.  I have read nothing that makes me believe this was a conscious or willful act, but in the end, that is a minor point.

 

More than the penalty assigned by the judge in June, something needs to change (shocker again), probably by initially by putting an agent on each vessel to ensure compliance and implement a plan and action that ensures it will work.  NOT an easy task.

[bury me at sea]

Thank you jimbo for your thoughtful reply.

 

As often as you and I seem to disagree on some threads, we seem to agree that this was a major misstep on a major problem.

 

I have enjoyed every Carnival cruise, though it's obviously harder for me than for you to accept silently some of the changes (I refer to as cutbacks) in the last several years.

 

Carnival can and should do better.  I would hate to see this issue resolved by firing a few low level personnel when those at the top must have been aware of the violations.

[jimbo5544]

23 minutes ago, bury me at sea said:

Thank you jimbo for your thoughtful reply.

 

As often as you and I seem to disagree on some threads, we seem to agree that this was a major misstep on a major problem.

 

I have enjoyed every Carnival cruise, though it's obviously harder for me than for you to accept silently some of the changes (I refer to as cutbacks) in the last several years.

 

Carnival can and should do better.  I would hate to see this issue resolved by firing a few low level personnel when those at the top must have been aware of the violations.

Some here, including our local expert, think it will (or at least should) cut much deeper.  I really have no idea, and have mixed emotions on terminations and convictions and jail time in the business world.  I am unimpressed with what I have read here on how someone at a higher level knowing about the issue (responsibility is a different topic), but to be honest, I have not dug deeply, only scanned posts here and other places.  I would be SHOCKED if any corporate officer is convicted...but cannot back it up.  Micky, Arnold and Christine (and probably many others) will emerge scathe free (or until the board decides otherwise - note I did not say Judge).  I respect your views as well, and as I mentioned earlier, there is no up side to this mess - despite the bashers saying the contrary.  My 2 cents and $4.99 can get you a happy meal at McDonalds....

 

I really do hope that Carnival (the corp and the cruise line) will come out better from this and the kick in the nether regions is appreciated for what it truly is for.....

Edited April 18, 2019 by jimbo5544

[bury me at sea]

Coming out better would be a good resolution.

 

Sorry that I couldn't edit your message to the last paragraph. 

 

The combination of an ancient phone and a lack of tech skills makes it hard to respond as I would like to do.

[jojonlolasmom]

They need a wake up call, and figure out where they’re going wrong.  I’ve gone on a cruise once, I’m supposed to be going on August unless the judge kicks them off the US ports. Question to our local experts: how long are these bans? Are they months, years, days? 

[elcuchio24]

16 minutes ago, jojonlolasmom said:

They need a wake up call, and figure out where they’re going wrong.  I’ve gone on a cruise once, I’m supposed to be going on August unless the judge kicks them off the US ports. Question to our local experts: how long are these bans? Are they months, years, days? 

 

They will never happen, so do not worry yourself.

[chengkp75]

3 minutes ago, elcuchio24 said:

 

They will never happen, so do not worry yourself.

I would suspect the possibility of a ship by ship ban for those ships that have been proved to have repeated violations in the 800+ line items of the probation violation findings.  I would suspect the ships could be banned for a year, or until their record of compliance is clear, whichever is longer.  This is not an unusual punishment.

[jojonlolasmom]

3 minutes ago, chengkp75 said:

I would suspect the possibility of a ship by ship ban for those ships that have been proved to have repeated violations in the 800+ line items of the probation violation findings.  I would suspect the ships could be banned for a year, or until their record of compliance is clear, whichever is longer.  This is not an unusual punishment.

That seems fair enough, just hope it’s not my ship that’s a repeat offender. Lol . But honestly do you think this is finally their wake up call? Do they really understand what they’re doing ? And what they are/can lose? 

[chengkp75]

1 minute ago, jojonlolasmom said:

That seems fair enough, just hope it’s not my ship that’s a repeat offender. Lol . But honestly do you think this is finally their wake up call? Do they really understand what they’re doing ? And what they are/can lose? 

Most shipping companies get their wake up call after the first settlement.  Unless this second violation really hurts Carnival badly, financially, I don't know if they will "get the picture".

[cruiserider444]

disappointed in Carnival. I wish I didn't book my cruise with them and most likely won't cruise w them again. 

[Keys2Heaven]

36 minutes ago, cruiserider444 said:

disappointed in Carnival. I wish I didn't book my cruise with them and most likely won't cruise w them again. 

 

Then cancel your booking, unless you're speaking in past-tense.

[Keys2Heaven]

On 4/17/2019 at 8:27 PM, Thorncroft said:

Carnival has no recourse but to throw themselves at the mercy of the court, here.

 

Don't expect a multi-billion dollar company to roll over.

[chengkp75]

13 minutes ago, Keys2Heaven said:

 

Don't expect a multi-billion dollar company to roll over.

There's not a lot of wiggle room for a probation violation.  Carnival originally agreed to the settlement, to preclude a more severe penalty, including abiding by the findings of a court appointed auditor.  Now you think they can say "oh, we disagree with the findings?"  They voluntarily agreed to these terms, and are now finding out what happens when you pay scant attention to the terms of your probation.