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The Economic Impact of Carnival Cruise Lines Operations in the Long Beach Economy and the State of California, 2006 Carnival Corporation: A Global Company Carnival, one of the most popular and profitable cruise lines in the world, began in 1972 as the vision of the late Ted Arison. Today, Carnival Corporation operates a fleet of 87 ships, with another 20 ships scheduled for delivery between now and 2012. At any given point in time, there are more than 215,000 people sailing aboard the Carnival fleet, with over 160,000 guests and 80,000 shipboard employees worldwide. The North American cruise industry accounts for over 80 percent of worldwide passenger embarkations. Carnival Corporations is the unquestioned market leader with 50 percent of all embarkations. Carnival Cruise Line is the largest single cruise line in the industry with over 3 million annual passengers and a market share of 33 percent. CC-1.indd 1 6/10/08 10:33:10 AM Economic Impact of Carnival Cruise Lines Operations in the Long Beach Economy and the State of California, 2006 The Long Beach Cruise Terminal Economic Impacts In 2003, the Long Beach Cruise Terminal opened, representing Economic impacts from Carnival Cruise Lines’ Long Beach Cruise an investment of $50 million. The construction of the passenger Terminal arise from: terminal was unique in that it marked the first time a cruise company, Carnival Corporation, built a port in the United States • Spending by cruise passengers and crew members for goods and from scratch, including the terminal and pier. services associated with the cruise. In 2006, cruise passengers and crews spent $24.9 million in the local economy. Carnival Cruise Lines has two ships positioned out of Long Beach. Carnival Pride is a ship with 2,124 lower berths that provides a • Spending by Carnival Cruise Lines’ operations staff at the seven-day cruise usually to the Mexican Rivera, with ports of call in terminal and their expenditures for goods and services, including Puerto Vallarta, Mazatlan, and Cabo San Lucas. Carnival Paradise food and beverages, fuel, hotel supplies, equipment and so forth. In is a ship with 2,052 lower berths that provides three and four day 2006, Carnival Cruise Lines spent $57.5 million on its operations cruises to Baja Mexico (Ensenada Mexico and Catalina Island). and purchasing within the local economy. The Long Beach Cruise Terminal served approximately 400,000 • The $82.4 million in direct expenditures generated an individual passengers annually or 800,000 embarkations and employment impact of 536 jobs and an annual payroll of $18.2 disembarkations. Almost 20 percent of cruise passengers are million. out-of-the-area and generate approximately 53,000 room nights in either pre or post cruise stays in the local economy. The direct expenditures of $82.4 million, in turn, yield indirect and induced impacts in the regional and state economies. Passengers & Crew Spending, • In the regional economy, defined as the counties of Los Angeles, $24.9 million millions Orange, San Diego, Riverside, San Bernardino, and Ventura, the $30.0 total economic impact of Carnival Cruise Lines was $126.6 million, $24.9 million an annual payroll of $28.9 million and 792 jobs. $22.5 $20.5 million • At the state level, Carnival Cruise Lines’ Long Beach operations $15.0 generated a total economic valued at $132.4 million, an annual payroll of $31.2 million supporting 847 jobs. The total economic $7.5 $4.4 million impact for the State of California is only slightly higher than that of the region, indicating that much of the economic impact of Carnival $0 Crew Passengers Total is in the local and regional economy. CC-1.indd 2 6/10/08 10:33:11 AM Future Prospects Carnival Cruise Lines Direct Expenditures, $57.5 million On March 29, 2009 one of Carnival Cruise Lines newest ships, millions Carnival Splendor, is scheduled to replace Carnival Pride for the $60 $57.5 million seven day voyages to the Mexican Rivera. Carnival Splendor is a $50 113,300-ton vessel with a maximum passenger capacity of 3,700. The deployment of Carnival Splendor requires a $10 million construction $40 $36.6 million expenditure for an additional berth and related expenditures to the pier and the Long Beach Cruise Terminal. $30 $20.9 million Carnival Splendor will have additional economic impacts with its $20 Ship Provisions Port & Operating Total increased capacity of 1,000 additional passengers and an additional Costs Expenditures 300 crew members per cruise. Had Carnival Splendor been deployed in Long Beach during 2006, the total annual passengers would have increased by 50,000. In 2006 dollars, these additional passengers Total Direct Expenditures, would have spent $5.4 million; added crew members would have $82.4 million spent $600,000; the economic impact of Carnival Splendor would millions have increased direct expenditures in the local economy by $6 million. 90 82.4 million The added capacity of Carnival Splendor would cause Carnival 70 57.5 million Cruise Lines purchases of goods and services to increase$3 million. 50 Staffing levels for embarkation, disembarkation, security and added personnel would have involved additional $5 million expenditure. 30 24.9 million Overall, the additional economic impact of Carnival Splendor would have been $14 million in direct annual expenditures. These added 10 Passengers & Crew Carnival Cruise Lines Total Direct Expenditures expenditures would have increased the direct expenditures from $82.4 million to $96.4 million. CC-1.indd 3 6/10/08 10:33:13 AM Total Economic Impact of Carnival Cruise Lines Operations in the Long Beach Economy and the State Activity Direct Indirect Induced Total Operations and Purchasing $57.5 million $17.1 million $16.5 million $91.1 million Passenger and Crew Spending $24.9 million $8.2 million $8.2 million $41.3 million Total $82.4 million $25.3 million $24.7 million $132.4 million Jobs Operations and Purchasing 297 78 123 498 Passenger and Crew Spending 239 49 61 349 Total 536 127 184 847 Payroll Operations and Purchasing $11.9 million $3.9 million $4.6 million $20.4 million Passenger and Crew Spending $6.4 million $2.1 million $2.3 million $10.8 million Total $18.2 million $6.0 million $6.9 million $31.2 million Economic Impact Study of Carnival Cruise Lines Operations This study was prepared by Drs. Lisa M. Grobar and Joseph P. Magaddino of the Office of Economic Research at California State University, Long Beach. The authors may be contacted at 562.985.5061 or email@example.com. 2008 CC-1.indd 4 6/10/08 10:33:15 AM
"Carnival Cruise Lines Operations"