NEWS: Government Bailout Approved for Disney's Cruise Ship Builder

Disney is working on expanding its cruise line fleet — and in a HUGE way.

In addition to the five ships in its current fleet, Disney Cruise Line has four more ships currently in the works — and has announced an additional four ships over the next decade as well. Disney outsources its shipbuilding to a company in Germany — and they just got a major bailout from the government.

The German government has approved a bailout for Meyer Werft — the shipyard that builds a majority of vessels for Disney Cruise Line. Euronews has reported that the federal government will be purchasing about a 40% stake in the company for €200 million.

In addition, Germany plans to provide Meyer Werft with a €1 billion loan guarantee that the government will pay if the shipbuilder is unable to do so — upon approval by the budget committee.

The state of Lower Saxony will also match the loan guarantee and is set to purchase around 40% of Meyer Werft for €200 million. Essentially, the 80.7% acquisition will mean the German government has control of two of the company’s shipyards, in Papenburg and Rostock-Warnesmünde. There is an additional shipyard in Turku, Finland, that the Meyer family will still control.

Meyer Werft found itself in financial trouble largely due to the COVID-19 pandemic, which raised the price of materials, labor, and more. What’s more, 80% of the construction price is paid upon delivery in the cruise industry — meaning Meyer Werft has to have cash reserves to pay for manufacturing upfront.

According to CruiseRadio, it’s estimated that Meyer Werft requires more than €2.3 billion in capital to cover restructuring efforts and operational losses. the shipyard also has a full order book for at least the next five years — including Disney Cruise Line ships.

The company built the Disney Dream, Fantasy, and Wish in the past, and it’s currently working on the Disney Treasure and Destiny. A future unnamed ship Disney is creating in partnership with the Oriental Land Company and four additional ships are also set to be built at the Meyer Werft shipyard.

It’s unclear whether or not this bailout will impact the eight Disney Cruise Line ships on the Meyer Werft order book, but we’ll be on the lookout for any potential updates.

In the meantime, we’ll keep you updated on the latest updates from Disney Cruise Line and all things Disney. Make sure you stay tuned to AllEars for more news and so you don’t miss a thing!