Disney Cruise Line is exploring a new preferred berthing agreement with a memorandum of understanding for terminal usage in New York is how this article should have read based on new information. After some investigation, I’ve determined the article I used as a source for the post on DCL extending a berthing agreement in New York was based on incorrect information. The original article remains at the end of this article for transparency purposes along with a link to a web archive of the original version of the source article.
After reviewing minutes from a December 2017 New York City Economic Development Corporation (NYCEDC) meeting as well as corresponding with a representative from NYCEDC, I’ve learned the executive board did discuss berthing agreements for Carnival Cruise Lines, Disney Cruise Line, and MSC Cruises. However, no formal berthing agreement with Disney Cruise Line has been made at this time. I did not inquire about the status of the other lines referenced in the minutes.
Three proposed usage agreements (the “Usage Agreements”), one with each of Carnival Corporation d/b/a Carnival Cruise Lines or an affiliated entity, Magical Cruise Company, Limited, d/b/a Disney Cruise Line, or an affiliated entity, and MSC Cruises S.A. or an affiliated entity (“MSC”), each of which operates cruise lines (each a “Cruise Line,” and collectively the “Cruise Lines”), related to berthing space at the Manhattan Cruise Terminal and/or Brooklyn Cruise Terminal, on substantially the terms set forth in Exhibit H hereto.
In answer to a question from Mr. Wilkins, Mr. Patchett stated that under the proposed Usage Agreements the actual fees per berthing would be slightly lower than in the past, but that there would be a significant increase in volume commitments, which would result in a substantial overall increase in revenue. Mr. Patchett also noted that MSC had just started berthing in the City, and thus was another increased source of revenue. — approved minutes from the December 13, 2017 meeting
Exhibit H of the minutes which appears to be the basis of the original Cruise Industry News article includes a now dated look at a potential preferred berthing agreement at either Manhattan Cruise Terminal (MCT) or the Brooklyn Cruise Terminal (BCT) Disney Cruise Line.
In the document, it is stated Disney Cruise Line is committed to bringing a guaranteed volume of passengers to the cruise terminals and for the first time is seeking to enter in to a usage agreement with NYCEDC. The Exhibit H usage agreement would provide Disney Cruise Line with guaranteed berthing space at the Manhattan and/or Brooklyn terminals along with incentives and other discounts on the port facility charges in exchange for a guaranteed minimum number of passengers over the term of the agreement.
DCL’s initial term of the Exhibit H agreement would 5 years, with two five-year renewal options. The potential agreement would guarantee Disney one berth at MCT or BCT seven days a week to allow the cruise line to plan future deployments with the assurance that berth will be available for their ship.
The Exhibit H agreement mentions passenger counts. It is important to understand this number. Ports typically count passengers when they embark and debark or port of call. Think of it more as the number of passenger movements. For a closed-loop cruise, you are counted when you board and when you leave. The only time a passenger would be counted once is if the ship is visiting for the day (port of call) or in the case of a repositioning cruise where the cruise only ends at the port like the recent Disney Magic Transatlantic cruise which started in Dover and ended in New York.
After reading over Exhibit H, the passenger count is, in fact, passenger movements. The agreement shows that Disney Cruise Line would guarantee a minimum of 200,000 passengers (movements) over the initial 5-year term which in turn would generate an estimated $5.02 million in gross revenue for the port. That 200,000 passenger movements equates to roughly 20,000 passengers per year or about 8 cruises give or take based on repositioning cruises.
Original Article: Disney Cruise Line Extends New York Berthing Agreement Through 2022
According to a report from CruiseIndustryNews.com, Disney Cruise Line recently entered into a long-term agreement with the New York City Economic Development Corporation, which oversees cruise ports in New York City.
Cruise Industry News mentioned the five-year deal extends through 2022, guaranteeing Disney Cruise Line a berth at Manhattan or Brooklyn Cruise Terminal seven days a week. In exchange, Disney guarantees New York a minimum of 200,000 guests annually over five years, generating an estimated $5.02 million in gross revenue.
Clarification on guaranteed passenger counts – While I have not been able to review the contract, ports typically count passengers when they board and debark. They use the term passengers when they mean passenger movements. The only time passengers are counted once is if the ship is visiting for the day (port of call) or in the case of a repositioning cruise where the cruise only ends at the port.
UPDATE: The reference to the berthing agreement has been removed from the Cruise Industry News article. Click here to see an archive of the original article.