Business Monday

Carnival Corp. chief executive officer Alan Buckelew talks about China

Alan Buckelew, chief operations officer at Carnival Corp., has relocated to China to oversee operations there.
Alan Buckelew, chief operations officer at Carnival Corp., has relocated to China to oversee operations there.

This time last year, Alan Buckelew was still CEO of Princess Cruises, a California-based role he’d held since 2007.

What a difference a year makes.

In December of 2013, he started a new job with Princess parent company Carnival Corp., which is based in Doral, as chief operations officer. While he held on to his Los Angeles home, the corporate position required him to become a part-time South Florida resident as well.

Just last month, the company announced a new role for Buckelew, 65 — with yet another move. The 37-year cruise industry veteran has relocated to Shanghai to oversee Carnival’s growth in China while holding on to his COO duties.

In an email interview, Buckelew discussed his year of moves, his goals in China and the importance of that market to the company and cruise industry as a whole.

Q. Where are you working these days? Have you already made the move to China?

A. I have officially relocated to Shanghai to directly oversee our expanding operations in China, while continuing in my role as chief operations officer of Carnival Corporation with responsibility for all maritime and port operations around the world, IT, Internal Audit, as well as other strategic operational functions for our company.

Q. Why was the decision made to shift your home base to China?

A. Carnival Corporation is the cruising leader in China today and the market represents a tremendous opportunity for us moving forward with potential for double-digit growth over the next decade. We are also committed to helping China realize its vision of being one of the world’s leading cruise markets, so being on the ground to work directly with our team and partners will help all of us maximize the potential for cruising in China in a timely fashion.

Q. How tricky will it be to continue your COO duties, considering the geographic distance and time difference?

A. It is definitely a balancing act, but it is an opportunity I could not pass up considering the strategic importance of China to our company and the amazing potential for China to be an emerging cruise market unlike anything we’ve seen in four decades, including a projected 4.5 million cruise passengers in China by 2020.

Q. What are your main priorities when it comes to the Chinese cruise market?

I’m focused on strategic planning, growing our leadership position, relationship building and supporting China in its efforts to develop and grow into one of the world’s leading cruise markets. In fact, we just signed a memorandum of understanding with the largest Chinese shipyard to explore joint ventures in shipbuilding, creating a domestic Chinese cruise brand, port development and other areas to support growth in Chinese cruising.

Q. How does the Chinese market typically book a cruise and take cruises now? How are those patterns different from North America?

A. Awareness of cruising is fairly low in China and demand is rising, which represents a big opportunity for all involved in the Chinese cruising industry to show the value of cruising in creating lifelong vacation memories.

Chinese cruisers are typically younger, traveling with parents and children, and they want to take shorter cruises, book on shorter notice and are really interested in the experience of travel for both fun and personal growth. All bookings are made through travel agents with outbound travel licenses.

Q. Is Carnival hoping to encourage a change in those behaviors at all?

A. Not at all – we are looking to grow awareness, appeal to a growing market that spends more on tourism than any other country and accelerate demand that is already on the rise by working with Chinese officials to develop and grow the cruise industry and infrastructure so more Chinese travelers choose cruising as their vacation of choice.

Q. How much do various Carnival brands tweak their product to appeal to Chinese travelers?

A. Our brands, especially Costa and Princess, go to great lengths to tailor our offerings for the tastes of Chinese travelers, including shorter itineraries since they typically have less time off for vacation, packed with luxury shopping, sophisticated style, new fine dining options, personalized services and opportunities for personal life enrichment, all of which align with what Chinese cruisers tell us they are looking for in a cruise experience. While both brands tailor the product to suit the Chinese market segment they are serving, fundamentally the product is the same as offered everywhere else in the world.

Q. What will Carnival’s presence be in China next year?

A. In expanding our industry-leading presence in China next year, we expect to carry 500,000 passengers in 2015, and we’ll be the first cruise operator with four ships home-ported in China when our Costa brand adds Costa Serena as the third ship in its fleet in China in April 2015, in addition to our Sapphire Princess ship based in China.

Q. How much of a change does that represent compared to this and previous years?

A. From 2013 to 2015, we’re growing our capacity in China by 140 percent, and in Asia overall, we’ve doubled our market share in the past two years.

Q. What are the major challenges there still?

A. Similar to the cruise industry in North America in the 1970s, the Chinese cruise market is in its infancy, so we are working to grow awareness for the value and experience of cruising and capitalize on the vast growth opportunity in China. We want to help China in its goal to be a leader in cruising, which requires development of infrastructure, ports and other areas, all of which are very normal for an emerging market. What is abnormal in this market is the incredible growth rate and potential upside for cruising in China.

Q. What potential do you see in China?

A. Government projections for the near term in China estimate 4.5 million passengers by 2020, and we believe China will someday be the largest cruise market in the world.

Q. Did you ever expect that you’d be making two big moves over the course of less than a year at this point in your career? (If you’d suspected as much, would you have retired when you still had a chance?)

A. No, I absolutely did not expect it! But I’m having fun, I’m excited to come to work every day, and I feel energized by the new opportunities I’ve been given to make a contribution to Carnival Corporation and serve our company in a way that provides value. I feel very lucky to have spent 37 years in this business, and I couldn’t have asked for more in this new assignment.

Q. As more North American lines move capacity to Asia, do you see that as competition for Carnival or as an overall positive for broadening the market?

A. It is definitely a positive for the market, which can handle the added capacity, and in fact, there is headroom for more growth based on strong demand. Supporting the development and growth of cruising in China is something we all can play a role in and benefit from if we stay focused on providing the best possible cruise experience for guests in China.

Alan B. Buckelew

Title: Chief Operations Officer, Carnival Corporation

Age: 65

Lives in: Shanghai

Education: MBA and bachelor’s degree from UCLA

Professional background: 37 years spent in several leadership positions in the cruise industry, including CEO of Princess Cruises

Family: Wife, Chris, and two grown daughters, all living in Los Angeles

Hobbies: Who has time for hobbies with my crazy schedule; with some spare time on weekends I may seek out some new interests

Interests: Making a difference in everything I do, nonprofit work, board assignments and my day job