Royal Caribbean Ends Its Joint Venture With Ctrip in China

SkySea Cruises, a joint venture between powerhouses Royal Caribbean Cruises and Ctrip,  will stop sailing by the end of the year.

The companies disclosed the decision to end the venture late Monday. Both had a 35 percent stake in the line, with SkySea management and asset manager Stone Capital  holding the rest.

First announced in November of 2014, SkySea was meant to be “a national cruise line for China” that was created specifically for the market. It started with one ship, which was formerly operated by Celebrity Cruises, and the companies said there was potential to add more over time.

“We expect SkySea cruises to be an integral part of China’s fast growing cruise market,” former chairman and CEO Min Fan said in a 2014 statement.

The line started sailing in 2015. But as foreign players including Royal Caribbean International, Princess Cruises, and Norwegian Cruise Line entered the market over the next few years with newer, bigger ships, competition grew more fierce and prices suffered.

Tensions between China and South Korea also kept popular Korean ports off limits for cruises that left China, leading to itinerary changes that also hurt pricing.

“SkySea did a lot of things right, and we’re proud of their work,” said Rob Zeiger, global chief communications officer for Royal Caribbean Cruises, in an email. “But it was hard for the brand to break through and build broad awareness at a time when a lot of global names were entering the China market.”

SkySea’s ship, Golden Era, will be sold to TUI’s Marella Cruises. It is expected to be delivered in December.

Royal Caribbean and Ctrip expect SkySea to cease business operations before the end of the year. They believe employees can be absorbed into available positions at both companies.

“Through its Royal Caribbean International brand, [Royal Caribbean Cruises] will continue to serve the Chinese market, with the largest fleet deployment in the region and a strong collaborative relationship with Ctrip,” the statement said.