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Tag: Environmental Impact of Cruise Line Industry

  • Clean, Green, and Cost-Effective Businesses – What’s Making the E-commerce & Food Giants in India Shift to Electric Fleets?

    This article has been contributed by Pritesh Mahajan, Founder, Revamp Moto.

    The landscape of India’s business world is changing, and it’s changing rapidly. In recent years, sustainability has emerged as a central theme in global business discussions. The urgency to combat climate change and reduce greenhouse gas emissions has pushed companies worldwide to reevaluate their environmental impact. India is no exception. With a growing awareness of the environmental challenges and a commitment to cleaner, greener practices, Indian businesses are taking significant steps towards sustainability.

    E-commerce and food delivery giants, in particular, are undergoing a significant transformation as they seek to align their operations with sustainability goals and cost-effectiveness. A key driver of this transformation is the shift toward electric fleets. This concept has become a huge motivating factor that encourages industry leaders to embrace electric vehicles and the profound impact it’s having on the business ecosystem.

    The Electric Revolution
    1. Zomato: Partnering for a Greener Tomorrow
    2. Amazon India: Delivering Sustainability
    3. Flipkart: Pioneering Sustainability
    4. Swiggy and BigBasket: Delivering Green Convenience
    5. Maersk: A Global Leader in Sustainability
    Technology Driving the Transition
    Government Initiatives and Infrastructure Development
    The Road Ahead

    The Electric Revolution

    Electric vehicles have become a symbol of this sustainability drive. These vehicles are not just environmentally friendly; they also offer substantial cost advantages over traditional internal combustion engine (ICE) vehicles. In India, EVs have garnered increasing attention for their potential to reduce air pollution, decrease fuel costs, and promote energy efficiency.

    To put things into perspective, a study by Boston Consulting Group found that the total cost of ownership of a high-speed two-wheeler EV is around 35% lower than the same model with a combustion engine. An electric three-wheeler is 25% cheaper than its diesel counterpart. These numbers alone underscore the economic rationale behind the shift to electric fleets.

    Several prominent e-commerce and food delivery giants in India are at the forefront of this electric revolution. Let’s delve into some real-life examples.

    1. Zomato: Partnering for a Greener Tomorrow

    Zomato, a multinational restaurant aggregator and food delivery company, has set ambitious sustainability goals. In 2022, Zomato partnered with Jio-bp, a joint venture of Reliance Industries and BP, with the aim of electrifying its entire fleet by 2030. At that time, the company already had around 4,000 riders using EVs for deliveries. Zomato’s strategy includes increasing awareness among its drivers on EVs across India and forming partnerships with original equipment manufacturers (OEMs) and leasing companies to accelerate the electrification of its fleet.

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    2. Amazon India: Delivering Sustainability

    Amazon India, a major player in the e-commerce sector, joined forces with TVS Motor, one of India’s largest two-wheeler manufacturers, in 2022. This partnership aimed to bolster the deployment of electric two-wheelers and three-wheelers for last-mile deliveries. Amazon India has set an ambitious target of adding 10,000 EVs to its fleet by 2025, aligning with Amazon’s global commitment to adopt 100,000 EVs by 2030.

    3. Flipkart: Pioneering Sustainability

    Flipkart, India’s pioneering e-commerce company, has been a trailblazer in embracing EVs. It was the first Indian e-commerce company to introduce electric vehicles to its fleet and join The Climate Group’s EV100 initiative. Flipkart has made a bold commitment to become 100% electric by 2030, marking a significant milestone in its sustainability journey.

    4. Swiggy and BigBasket: Delivering Green Convenience

    Swiggy, India’s leading on-demand convenience delivery platform, embarked on a green journey by partnering with Taiwanese battery-swapping company Gogoro. This strategic move involved switching to electric intelligent scooters, contributing to reduced emissions and cleaner air. Similarly, BigBasket, an online supermarket based in Bangalore, is determined to electrify 90% of its fleet, demonstrating its commitment to sustainable last-mile deliveries.

    5. Maersk: A Global Leader in Sustainability

    Mærsk, a Danish shipping and logistics company, recognized the importance of electric vehicles in distribution logistics in India. In August, the company announced its plan to deploy an additional 500 EVs in 26 Indian cities to ramp up electrification in first-mile, middle-mile, and last-mile deliveries. Maersk had already taken the first step in September 2022 by launching electric three-wheelers and four-wheelers in Mumbai.

    Technology Driving the Transition

    Technology has played a crucial role in facilitating this transition to electric fleets. One notable example is UK-based Saietta’s Vehicle Control Unit (VCU) designed specifically for three-wheeled and four-wheeled light electric vehicles (LEVs). Saietta has partnered with HCLTech to manufacture the VCU in India and deliver over 80,000 units to Indian LEV manufacturers over five years. This partnership underscores the technological advancements that are driving the EV revolution in India.

    Government Initiatives and Infrastructure Development

    It’s worth noting that government initiatives have also paved the way for the adoption of electric fleets. The ‘Go Electric’ campaign, launched in 2021, seeks to educate the public about the advantages of EVs. Additionally, the FAME II scheme, aimed at supporting the electrification of public and shared transportation, has contributed to the growth of electric fleets in ride-hailing and delivery services.

    One of the critical factors behind the success of electric fleets is the expansion of charging infrastructure. Both public and private players have invested in charging stations across the country. This development addresses a significant concern for potential EV buyers: range anxiety. With improved charging infrastructure, EV adoption is expected to accelerate further.

    The Road Ahead

    As more e-commerce and food delivery giants in India embrace electric fleets, the ripple effect of this transformation is evident. It not only aligns with global sustainability goals but also sets an example for other businesses to follow. The initial investment in EVs may be higher, but the long-term cost savings, reduced emissions, and positive impact on the environment make it a compelling choice.

    As Pritesh Mahajan, Co-founder of Revamp Moto, a leading name in sustainable mobility solutions, puts it, “The adoption of electric fleets by e-commerce and food delivery giants is one of the most efficient ways to integrate electric vehicles on the road. It not only increases their visibility but also encourages more people to make the shift to cleaner and greener mobility options. This shift is a win-win, as it not only saves costs for businesses but also aids mobility among the hardworking delivery professionals. It’s a step towards a sustainable future that we can all be proud of.”

    The shift to electric fleets by e-commerce and food delivery giants in India is more than a business decision; it’s a commitment to a cleaner, greener, and more sustainable future. With technology advancements, government support, and a growing charging infrastructure, the road ahead looks promising. As these industry leaders continue to lead by example, it’s only a matter of time before electric fleets become the norm in India’s delivery and logistics landscape.

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  • Evolution of The Cruise Industry

    By the year 2018, the entire cruise industry’s market worth was USD 150 billion making it the fastest-growing segment of the tourism industry. By early 2020, the industry welcomed more than a million passengers onboard the various cruise ships and seemed to be well on the road to a record-breaking year.

    Unfortunately, the global hit of the coronavirus pandemic brought all economic activity to a standstill overnight. Between March 2020 and September 2020, the cruise industry lost business worth USD 77 billion. A study conducted by Statista recorded that over 500,000 jobs were lost with over 2500 jobs lost worldwide for each day that cruise operations were suspended due to the pandemic. In 2021, the cruise industry slowly began operating as restrictions relaxed with more companies joining as the year progressed. The question that keeps hovering in the face of such a sudden and unforeseen collapse is – Will the cruise industry recover?

    History
    Cruise Industry – Current Trends
    Facilities and Amenities Offered Aboard Cruise Ships
    The Effect of the Pandemic
    Environmental Impact of the Cruise Line Industry
    Drivers of the Cruise Industry and Conclusion

    History

    The year 1822 is considered the birth year of the cruise industry with the first leisure cruise by the Peninsular & Oriental Steam Navigation Company. Three sailors Captain Richard Bourne, Brodie McGhie, and Arthur Anderson began with a steam service between London, Spain, and Portugal, better known as the Iberian Peninsula. Two decades later, in 1844, the first passenger cruises were introduced that marketed sea tours to destinations like Athens, Malta, and Gibraltar. The company later introduced round trips to Alexandria and Constantinople.

    The rapidly growing popularity of the cruise industry saw major development with larger, more luxurious ships being built in the later half of the 19th century. The SS Ravenna became the first ship to be built with a complete steel superstructure in 1880 and the SS Valetta which was built in 1889 was the first ship to use electric light.

    Augusta Victoria was the German cruise ship that popularized cruises to the wider market. It sailed in the Mediterranean Sea and the Near East between 22nd January and 22nd March 1891 with 241 passengers onboard. The first ship that was exclusively built for luxury cruising was named Prinzessin Victoria Luise of the German Empire. It was designed by Albert Ballin, General Manager of the Hamburg-America Line, and completed in 1900.

    Three European-owned luxury ocean liners offered transportation between Europe and North America in 1897, which increased to seven ocean liners by 1906.

    In the 1960s, when the jet aircraft was invented, the ocean liner trade suffered a terminal decline as passengers shifted from ships to planes. The ocean liner services that were aimed at passengers finally ceased in 1986. The focus then shifted from passenger travel to cruising with entertainment value. International celebrities were hired to perform onboard, along with cabarets. Casinos and other entertainment amenities were added and the crossing itself was advertised as a vacation.

    The Sovereign-class ships were contemporary cruise ships that were built in the late 1980s and were the first mega ships built specifically for the mass cruising market. These were also the first series of cruise ships that included a multi-story lobby and single deck housing cabins with private balconies.

    Between 1988 and 2009, just two short decades, cruise liners have grown longer and wider with an increased passenger capacity from just 2744 passengers to 5400 passengers. They have also tripled in volume from 73,000GT to 225,000GT.

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    Cruise Industry – Current Trends

    The cruise ship business has been, historically, volatile. The prominent reason for this is that ships are a large capital investment with high operating costs. Throughout its existence, cruise lines have sold, renovated, or rebranded their ships to keep up with the continually changing traveling trends. The 1990s witnessed a wave of failures and consolidations as many cruise liners were bought over by larger holding companies and continued operations as a brand. For example, Carnival Corporation & PLC’s owned Carnival Cruise Line had an earlier reputation as ‘party ships’ for younger travelers and yet turned its name around to become synonymous with the large, modern, and profitable enterprise.

    There are some cruise liners that even specialize in a particular cruise type. Saga Cruises allows passengers only above the age of 50 years aboard their ships, while Star Clippers only operate tall ships. Carnival Corporation & PLC, Royal Caribbean Cruises Ltd., and Norwegian Cruise Line Holdings are currently the largest cruise line holding companies and operators in the world.

    Carnival Corporation & PLC
    Carnival Corporation & PLC

    In comparison to the hotel industry globally, the total number of cabins on all world’s cruise ships amounts to less than 2%.

    Facilities and Amenities Offered Aboard Cruise Ships

    Cruise ships operate similarly to a hotel and are also known as floating hotels. These ships are equipped with a complete hospitality staff in addition to the crew. Modern cruises offer various dining experiences like formal fine dining, buffet-style eateries which may remain open 24 hours, or even a diverse range of ethnically themed restaurants. Various other on-board facilities include –

    • Card Room
    • Casino – Open only when the ship is on the high seas and able to avoid conflict with local laws
    • Child Care Facilities
    • Cinema
    • Clubs
    • Fitness Center
    • Hot Tub
    • Indoor / Outdoor swimming pools with water slides
    • Infirmary and morgue
    • Karaoke
    • Library
    • Lounges
    • Observation Lounge
    • Ping-pong tables
    • Pool tables
    • Shops – open on the high seas to avoid merchandising, licensing, and local taxes
    • Spa
    • Teen lounges
    • Theatre with Broadway-style shows

    There are a few ships that offer additional entertainment amenities like bowling alleys, ice-skating rinks, rock climbing walls, sky-diving simulators, miniature golf courses, video arcades, ziplines, surfing simulators, water slides, basketball courts, tennis courts, chain restaurants, rope obstacle courses, and even roller-coasters.

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    The Effect of the Pandemic

    As the world grappled and crumpled under the attack of the deadly coronavirus, all economic activity was brought to a standstill. The cruise industry was rocked under weighty restrictions from various governments as countries refused docking permissions or in some cases did not allow crew members to disembark and return home after the passengers were safely sent back. The cruise line stock saw a sharp decline on March 27th, 2020 after the USD 2 trillion relief package passed by the US Congress and signed by then President Donald Trump excluded companies that were not organized under United States Law.

    In a tweet, Senator Sheldon Whitehouse clarified – “The giant cruise companies incorporate overseas to dodge US taxes, flag vessels overseas to avoid US taxes and laws, and pollute with offset.  Why should we bail them out ?”  

    Carnival Corporation & PLC, which is registered in Panama, England, and Wales recorded a loss of 75% on its stock between 1st January and 31st March 2020.

    Environmental Impact of the Cruise Line Industry

    Sewage, greywater, hazardous waste, oily bilge water, ballast water, solid waste, and air pollutants are a number of waste streams that are produced by cruise ships in general. If left untreated, these wastes can be a significant source of pathogens, nutrients, and toxic substances that can cause damage to aquatic life. Cruise ships primarily run on heavy fuel oil which results in high sulphur dioxide emissions. However, most cruise ships are now taking active steps towards reducing environmental pollution and are fuelled by LNG. Cruise ships are also increasingly being adapted to use onshore power reducing dependency on diesel generators.

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    Drivers of the Cruise Industry and Conclusion

    The global cruise industry is being driven by the growing hospitality and tourism industry as holidaymakers are looking for small vacations in the wake of the pandemic. Millennials are increasingly enjoying leisure trips and voyages. River cruises are gaining popularity with attractive packages that include travel within the countries and not just the coastal areas.

    Between 2022 and 2028, the river cruise segment itself is all set to witness the fastest growth rate by registering a CAGR of 13.3%. However, the market is dominated by ocean cruises by revenue share due to their exciting packages, amenities, and entertainment activities. The cruise industry is here to stay for the long run as it continues to offer and deliver unique experiences to travelers.

    FAQs

    Which are the largest cruise line holding companies in the world?

    Carnival Corporation & PLC, Royal Caribbean Cruises Ltd., and Norwegian Cruise Line Holdings are currently the largest cruise line holding companies and operators in the world.

    Which was the first ship that was built for luxury cruising?

    The first ship that was exclusively built for luxury cruising was named Prinzessin Victoria Luise of the German Empire.

    What are the environmental impacts of the cruise line industry?

    Sewage, greywater, hazardous waste, oily bilge water, ballast water, solid waste, and air pollutants are a number of waste streams that are produced by cruise ships in general.