In an effort to streamline operations and maximize efficiencies, Cunard Line will be relocating to Princess Cruises' California offices by December 2004, sharing administrative, finance and IT functions with Princess.
"Cunard is a strong brand with a worldwide luxury image," explained P&O Princess CEO Peter Ratcliffe who pointed out that as a brand Cunard will be kept completely independent from Princess. But behind the scenes, "all the functions the customers and the travel agents will not see will be integrated." In fact, Ratcliffe said he hoped customers and agents would not even notice.
The relocation is expected to reduce future overhead costs for Cunard by approximately $20 million on an annual basis. Non-recurring charges related to the cost of the relocation of between $10 million and $15 million are expected to be recorded over the remainder of 2004.
Before P&O Princess was acquired by Carnival Corporation, Cunard was being positioned in the U.K. to compete head-on with P&O Cruises, according to Ratcliffe, who suggested that the brand positioning has since been modified to focus Cunard on the international luxury market. "Cunard enjoys high worldwide recognition.," Ratcliffe noted, "not only in the U.S. and the U.K., but also on the continent and in Asia."
With the sale of the Caronia, Cunard will operate the OE2 and the OM2 in 2005 and will receive the Queen Victoria in 2006. All three ships will be similarly positioned with a consistent product, which Ratcliffe described as "traditional luxury."
"I anticipate that we will continue to grow the brand," Ratcliffe added.
Cunard's North American sales and customer service department will report to Lee Robinson, Cunard's vice president of sales and customer service, and the North American marketing and revenue department will be led by David Gevanthor, Cunard's vice president of yield management and marketing.
Carol Marlow and Jackie Foggit, heads of sales and marketing in the U .K. and Australia, will also be reporting to Ratcliffe.
The current Cunard field sales force remains intact.
There are approximately 300 people employed at Cunard in Miami, and Princess is recruiting for 70 positions in Santa Clarita, while Seabourn Cruise Line is recruiting for 50 positions, according to Ratcliffe.
In Great Britain, Cunard's operations were also recently merged with those of other Carnival Corporation & pie U.K. brands.
While some P&O and Cunard itineraries may seem to overlap, such as the world cruises, Ratcliffe said pricing does not overlap. Also, while P&O carries British passengers, Cunard's passengers are from North America, the U.K and Australia, as well as other countries.
Pam Conover, who has been president of Cunard for the past three years, is stepping aside, but will oversee the transition to Santa Clarita, and will assume a new corporate position as senior vice president of "Carnival Shared Services."
Seabourn will stay in Miami and operate as an independent brand under Deborah Natansohn, who has been appointed president. She was formerly vice president ofs ales and marketing for Cunard.
Cunard already relocated from New York to Miami in 1997, while Seabourn moved from San Francisco. Larry Pimentel was president and CEO of the two brands from 1997 to 2001, when he was succeeded by Conover.