The Wall Street Journal Interactive Edition -- June 22, 1998
Slow Boat: Disney's Perfectionism
Frustrates Cruise-Ship Contractors
BY DANIEL MACHALABA and BRUCE ORWALL
Staff Reporters of THE WALL STREET JOURNAL
MARGHERA, Italy -- Gianni Alassio used to enjoy reading Mickey
Mouse comics. That was before his employer, Demont Srl, started work
on Walt Disney Co.'s first-ever cruise ship, the Disney Magic. Now,
Mr. Alassio hopes never to lay eyes on Mickey again. "It makes me
remember this job," he says.
As chief of engineering here for the Italian firm, Mr. Alassio has led a small
army of ship fitters that for months has been installing the Disney Magic's
piping, air-conditioning and ventilation systems. All the while, Disney
inspectors have swarmed over the ship, checking and rechecking
Demont's work and demanding that additional pipe supports and new
welds be put in. Some areas of the ship have had to be redone four or five
times -- nearly unheard of in the cruise business.
"They are too meticulous about unimportant things," Mr. Alassio says.
"Maybe Disney is not ready to work on ships."
Distinct Impression
For more than a year, Disney has been promising nothing short of a
reinvention of the cruise business, with not one, but two colossal ships
intended to combine the grandness of past ocean liners with a theme-park
experience. Meantime, it has been leaving its mark on the shipbuilding
business: Now three months past its original launch date, the $350 million
Magic -- featured in countless Disney ads -- has become one of the
most-delayed cruise-ship projects in modern times. And outfitting of the
Magic's sister ship, the Disney Wonder, is just getting under way.
The delays have spoiled the company's hopes of launching its cruise dream
at the ideal time. Now, the Disney Magic is scheduled to make its debut
July 30, when its target family audience is beginning to think about school,
not vacations, and when the industry's softest period, the fall hurricane
season, is around the corner.
Already, the company is having to eat the cost of paying crews that were
hired to start on the original launch date and the lost revenue from
canceled cruises. Clouding the horizon is Disney's plan to charge 30%
more than competitors at a time when cruise prices have been falling. And
many travel agents, on whom Disney is depending heavily to sell the
cruises, aren't happy with the delays.
That said, Disney is Disney -- an entertainment juggernaut with a magic
touch, and it could still become king of the high seas once its ships are up
and running. With plans to appeal both to families and to couples and to
attract first-time cruisers, Disney Cruise Line President Art Rodney
promises to "raise the bar for the whole cruise industry."
As for the delays, Disney officially lays the blame on shipbuilder
Fincantieri Cantieri Navali Italiani SpA and says there was nothing in the
ship's design that was so difficult it would slow the project. And Fincantieri
accepts responsibility, citing an unprecedented boom in the cruise industry
that finds companies racing to build the biggest, fastest and grandest liners.
Just four European shipyards build the majority of the world's cruise ships,
and they are straining to keep up with the new orders.
At the same time, interviews with Fincantieri, its suppliers and even
Disney's own executives monitoring the project in Italy suggest another
cause: Disney's legendary perfectionism. "We've probably driven them
nuts," says Robert Collins, a technical specialist for Walt Disney World
Co. who nonetheless defends the company's steps. While the shipyard's
goal is to build a ship as quickly as possible, he says, Disney's aim has
been to make it perfect, "and sometimes that doesn't mean quickly," he
says.
This isn't the first time Disney executives, including Chairman and Chief
Executive Michael Eisner, have endured delays in a project to get exactly
what they want; it has happened with some animated films and theme-park
rides. And Mr. Eisner is expected shortly in Italy, where his critique of the
Disney Magic's stage shows could result in still more adjustments, though
not enough to endanger the current launch schedule.
It hasn't been an easy ride for Disney's contractors. Shipbuilders are used
to cruise operators that send half a dozen executives to the shipyard to
monitor the progress of construction. Disney has shuttled more than 100
people through Fincantieri's yards here in Marghera and in nearby Trieste
since construction began in earnest in early 1997. Disney's focus on the
little things has wreaked havoc with schedules at the shipyard and with its
suppliers. Indeed, shipyard workers now call the two ships, which tower
over the Marghera yard, the Disney Tragic and the Disney Blunder.
In many ways, the cruise industry seemed to pose only a modest challenge
for Disney. The company's strong record over the past 15 years has
given it an aura of invincibility in nearly every endeavor -- even on New
York's Times Square, where a Disney store and theater now preside
over an area once dominated by strip joints and porn shops. As for its
cruise adventure, the company's long experience as a resort operator
seems an advantage in a business that revolves around keeping people
entertained on what is, in essence, a floating hotel. Disney was so
confident of the project that it handed out Disney Magic countdown
watches that ticked off the days and hours until the ship's early 1998
completion.
Disney officials wanted ships that could accommodate both families and
couples, without either group getting in the other's way. That would mean
separate deck areas, pools and dining facilities. It was Mr. Eisner who
came up with the idea of building a ship that looks like a grand old ocean
liner, in the tradition of the Normandie and the Queen Mary. "He didn't
want just another white ship," Mr. Rodney says.
The Disney Magic design is, indeed, a throwback, with a long black hull,
white cabin decks and two big red smokestacks, along with round
portholes and large goosenecks, neither of which have been used on ships
in years. Disney solicited bids from about a dozen shipyards, and chose
Fincantieri because, as Walt Disney World President Al Weiss puts it, the
shipyard understood "the uniqueness of Disney."
When Disney unveiled its plan in September 1996, it wasn't shy about
suggesting that it would improve on the industry standard. During the
presentation, a Disney executive suggested that the industry had gotten
lazy about the basics, such as the frequently disorganized way in which
passengers board and disembark from a ship. Disney promised "no
chain-link fences and overflowing trash bins" at the new private terminal it
was building at Port Canaveral, Fla., and entertainment to make the whole
experience more festive.
Though it would have been quicker and cheaper to accept one of the
shipyard's designs, Disney turned instead to Norwegian and Finnish ship
designers to come up with detailed plans for the Disney Magic. But that
created complications for Fincantieri, which had to translate the ship's
unconventional features into reality. "It was more difficult to build," says
Gianfranco Bertaglia, Fincantieri's vice director of cruise ships, "and that
means more time."
For instance, a plan to equip cabins with two bathroom spaces -- for
family convenience -- doubled the need for plumbing and electrical wiring.
The two smokestacks -- the rear one for exhaust, the forward one purely
cosmetic -- would place too much weight in the upper part of the ship,
possibly compromising the vessel's stability. Fincantieri solved the problem
by contracting with a yacht maker in Marghera to fabricate a fiberglass
shell for each smokestack, reducing the weight, but adding to costs.
The original plans for the ship also included a casino, but Disney officials
had second thoughts. Mr. Bertaglia estimates that changing the casino to
Rockin' Bar D, a country-music dance area, required more than 100 new
detailed drawings. "We like to design a room one time, not two times,"
Mr. Bertaglia says. "But if the owner is asking for something, what can you
say?"
Most of the delays on the Disney Magic have occurred in the outfitting
stage, after large sections of the ship were assembled on a dry dock and
the completed hull and superstructure were floated out to a dock where an
array of suppliers have installed the piping, furnishings, decorations and the
like.
Part of the problem was that Fincantieri was attempting to build several
other prototype ships at the same time as the Disney Magic. But it was
Disney's attention to detail that sticks in the minds of contractors. "Disney's
expectations were much higher than" any previous customer's, says Vic
Dobbs, a vice president of Glantre Engineering Ltd., an electrical
contractor working on the Magic's entertainment and communications
systems.
Not Giving a Centimeter
Mr. Alassio, the Demont engineering chief, says Disney inspectors fretted
unnecessarily over minor details; demanding, for instance, extra pipe
supports if fitters installed the supports just slightly farther apart than
specified. "There is more than enough strength in the plans," Mr. Alassio
says. "What difference does a centimeter make?"
But Disney officials bristle at such statements. "The spec is the spec, and
we get what we pay for," says Matthew Priddy, a senior vice president of
Walt Disney Imagineering.
Other contractors say Disney inspectors have gotten in the way of
finishing the Magic. While Disney has sent more than 100 managers to
oversee the work at the shipyard, Carnival Corp., the nation's largest
cruise line, usually stations six or seven supervisors on site during a
shipbuilding project. Even veteran Disney suppliers have been bowled
over by the company's focus on the minutiae. "It was unreal," says John
Cagle, general manager of Visions In Scale Inc., an Altamonte Springs,
Fla., creative-support-services firm that worked on the Disney Magic.
Visions In Scale artists labored 10 hours a
day for weeks to hand paint more than five
miles of narrow strips on ceiling panels to give
the effect of wood branches for the ship's
Caribbean-theme restaurant. In one case, Disney inspectors insisted that
the artists stop work on a cartoon decoration for the Animator's Palate
restaurant until they added another eyelash.
In the ship's atrium, figures of Mickey Mouse and other Disney
characters adorn the walls and railings. In Lumiere's restaurant, a mural
taken from Disney's film "Beauty and the Beast" covers a wall. And in
Animator's Palate, workers are installing a high-tech lighting system that
will turn the black-and-white room to full color as giant columns
masquerading as paintbrushes appear to extract color from an artist's
palette on the ceiling.
"That's not something you will find on any cruise ship," Mr. Priddy says.
"It's right out of the theme-park business."
That Just-So Look
Many of these effects were all the harder to achieve because the
fire-retardant plastics used on cruise ships required additional sanding and
baking in special ovens to get the look Disney wanted. Strolling the ship's
teak decks, Mr. Priddy points out another special effect. The ship's
lifeboats -- fiberglass made to look like wood -- are painted yellow to
match Mickey Mouse's red, white, black and yellow color scheme. That
required that Disney obtain a special exemption from international rules
requiring orange lifeboats.
According to contractors, the upper decks of the Magic are receiving the
finishing touches, and just about everyone involved in the project expects
the ship will meet the July 30 deadline. Whenever the Disney Magic sets
off on its maiden voyage, there remains the question of how well Disney
will fare in the cruise market. In this business, at least, Disney will be a
newcomer in a fiercely competitive field of established players, and the
Disney Magic is entering the market just as other big new vessels are,
too.
The Grand Princess, delivered by Fincantieri last month, is the largest
passenger ship ever built. Not to be outdone, Royal Caribbean
International recently ordered vessels 30% larger than the Grand Princess,
with space for 3,100 guests and diversions such as a rock-climbing wall
and an ice-skating rink. "They may not have Mickey Mouse, but they are
very strong competitors," says Murray Markin, president of Strategic
Decisions Inc., a Boca Raton, Fla., cruise-industry consulting firm.
Others question Disney's economics. Disney has paid a price for the
Magic's long, slender hull, which means roughly 20 fewer passenger cabins
than it could have had with one of the wide, boxy hulls most modern cruise
ships have. And by jettisoning the casino, the Disney Magic has forgone
what is an important profit center for most other cruise ships.
Higher cruise prices might partly compensate. But Disney's plan to charge
a 30% premium for cabin space compared with other cruise lines is
unorthodox, considering that much of the industry's growth has come from
vigorous discounting. Already, some travel agents are raising doubts about
the strategy. "When people see the price, they back off a little," says Bill
Sivillo, owner of Captain's Club Cruises & Tours in Middletown, N.Y.
All of a Piece
Disney officials insist that their cruise ships will be able to command a
higher price because they are in a league of their own. And they say the
ships are part of a strategy to get visitors to spend more time and money at
Disney theme parks in Florida. The main Disney Cruise package will
combine a multiday visit to Disney World with a three- or four-day
cruise. Travelers arriving at the Orlando airport will have their luggage
moved from the airport to hotel to cruise ship. Disney will even control
one of the destinations, a private Caribbean island it has named Castaway
Cay.
Then there is the ship itself, which already is causing a sensation even
before it leaves the dock at Marghera. A steady stream of sightseers
arrives by foot, bicycle, motorbike, automobile, tour bus and motor boat
to view the leviathan. Parents hold their children on their shoulders to get a
better look at the 15-foot Goofy hanging from the Magic's stern.
Says Koroush Yazdanfar, a cargo-ship officer gazing up at the ship with
his wife and five-year-old daughter: "I've been to 35 countries and never
seen anything like this."
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