The Norwegian Connection II
Updated: Nov 10
‘Hello? .. Yes, good evening! My name is Ted Arison and I’m calling from Miami, USA. We’ve never met but boy, do I have a great business proposal for you!’
I have no idea if those were the exact words but as cold calls go, this was one of the most consequential calls in cruise history, not for a single business, but for an entire fledgling industry. And within lies the rest of the answer to my original question; Why is the history of the contemporary Western cruise industry teeming with Norwegians – a people with seemingly only tangential connections to the phenomenon?
And if you are new here, let me just quickly draw your attention to the 'Part II' bit, signifying that if you want the full story of the Norwegian Connection to cruising, you best head back to Part I to catch up.
Ted in Trouble
In 1966, 42-year-old Israeli-American cruise operator Ted Arison found himself in dire straits in Miami, Florida. He had lost the one ship his fledgling cruise operation was based on due to the shipowner pulling out of the charter and all his attempts at securing a new ship in time had gone nowhere. He had the workings and bookings of a cruise line, but no ship and money was starting to get tight. With all other options exhausted Arison grasped at straws, picked up the phone and called a man he had only ever read about. Across the Atlantic, in Norway, a phone started ringing.
A Shipping Powerhouse
To the layman a Norwegian company may have seemed like a random place to call, but if you were looking for money, innovation and entrepreneurship in the shipping industry of the 1960’s, Norway was indeed the place to call. Building on the lead position grown in the interwar years, Norway emerged from World War II with an uncontested market leadership in tanker operations (oil/chemical). Norway was literally making millions on fueling the world recovery post-war and they were putting a lot of that money back out to sea. The (already substantial) Norwegian merchant fleet doubled in size in the 1950’s … and then doubled again in the 1960’s. Contributing greatly to this success was a strong through line of innovation and entrepreneurship in the corporate mindset, also making Norway first movers on the bulkification trend that would come to define the post-war era of merchant shipping and the #1 producers of specialized vessels for any type of maritime transport or offshore activity. If something new and revolutionary was going to hit the seven seas, chances are it had Norwegian fingerprints on it. Looking at this powerhouse of maritime growth and innovation, dangling a winning idea involving ships in front of Norwegian shipping tycoons was actually not a bad idea at all. And of course for those in the know, the preceding nearly-a-century's worth of Norwegian ties to the cruise phenomenon that I just spent Part I uncovering, probably also made Norway a logical place to float big cruise ideas.
The Kloster Connection
Answering the phone across the Atlantic was the then-37-year-old, third-generation Norwegian shipping tycoon Knut Utstein Kloster of Klosters Rederi A/S (est. 1923). I do not know if he habitually took business calls from complete strangers, but nevertheless he heard Arison out and something clicked. Arison laid out his idea of a cooperation in which he would provide all the functional and commercial framework of a cruise line business, if only Kloster would contribute a suitable ship and found Kloster a surprisingly engaged and attentive listener. While Arison did not get a firm commitment from Kloster on the phone, the two did agree to meet up in Miami and talk in person soonest and the result of that meeting became a formal cooperation to start a new company with the commercial cruise line staffing, sales and marketing apparatus handled by Arison and the ship management and nautical affairs handled by Kloster. The ship that Kloster contributed was the cruise ferry MS Sunward and the company was named Norwegian Caribbean Line – in deference to the Norwegian influence – but would later change its name to Norwegian Cruise Line.
Most people like to credit Ted Arison’s pitch skills for getting Knut Kloster onboard with the cruise concept, painting a picture of a shipping tycoon who was largely oblivious to leisure shipping before Ted Arison came along. But this is not true. Knut Kloster had already been dabbling in leisure shipping, looking to diversify his portfolio from bulk cargo carriers and tankers. The fact that he even had the cruise ferry Sunward (of the Kloster subsidiary Sunward Ferries) available to contribute to Arison’s venture was the result of a foray into leisure shipping that had gone nowhere. The Sunward was intended for a leisure role in the Bay of Biscay out of Gibraltar, but when a dispute between the UK government and Spain’s General Franco closed the border between Gibraltar and Spain, the basis for this operation fell apart and the Sunward went nowhere.
Moving an 8.000 ton vessel with 220 crew across the Atlantic was probably a small fry operation for a company like Kloster with coffers as deep as the Norwegian fjords, but nonetheless it seemed like a substantial asset to deploy on a whim. Arison was a nobody to Kloster and while his idea was not utterly far-fetched, his credentials for fronting such a venture certainly were. So why did Kloster invest himself this swiftly or this deeply in a complete stranger’s proposition? Perhaps it was the famed Norwegian egalitarianism that made Kloster look past what Arison was (or rather wasn’t) in shipping circles and into his core idea of leisure cruising that seemed to gel quite nicely with his own visions. Or perhaps Kloster had some familiarity with the leisure cruise concept from within his own family tree, from Norwegian industry contacts previously / currently involved with cruise operations or merely from watching those ships of leisure gliding in and out of Norwegian fjords all the summers of his adult life. Whatever the reason, the decision would become the corner stone of the contemporary North American cruise industry.
A New Ship in Town
The Sunward arrived in Miami in December 1966 and became an instant success on the local cruise scene. As the only new ship in an industry of old converted ocean liners and repurposed coastal steamers, she stood out and signaled modernity, luxury and excitement. Sales skyrocketed, business boomed and Kloster soon found himself dispatching more vessels from Sunward Ferries across the ocean to meet demand. With each successive Kloster-run ship arriving in Florida - the Starward, the Skyward, the Southward and more (witty industry banter suggested there would eventually be an Awkward) - additional Norwegian crew and executives (many packing personal experience with Norway's own cruise history) were pumped into the nascent American cruise industry, many opting to stay and grow within the industry, becoming the next generation of movers and shakers in cruising.
A success story obviously does not go unimitated. Watching the growing success of the Arison / Kloster-duo from his executive office at Commodore Cruise Line, was Edwin ‘Ed’ Stephan, former Korean War veteran and Florida hotelier-turned-cruise-line-president. Stephan was looking to break out on his own too and reasoned that where there was one investment-happy shipping tycoon, there would likely be more so when he left Commodore shortly after, he packed his own vision of a cruise line and booked a plane ticket for Norway, prepared to go door to door in the Norwegian shipping industry for financial backing.
And that he needed because the price tag on Stephan’s vision was substantial. He envisioned building customized state of the art cruise ships from scratch. That idea was a lot more revolutionary in the 1960’s than it is today – no one in the fledgling cruise industry were building their own ships at that time. Why would they? There was a wealth of retired and obsolete ocean liners out there after air travel had put them out of business (read End of Liners), that you could buy cheap and repurpose at minor expense. Sure, you wound up with a ragtag fleet of overhauled buckets and clunkers but who cared? Slap a coat of paint on it and pour a Margarita in a fancy glass and you were making money. The NCL story had conclusively proven the appeal of new and modern ships, but even the Kloster ships were not 'genuine' customized cruise ships – they were car / cargo ferries with deluxe accommodation and a leisure vibe (in fact much of early NCL revenue came from cargo business to and from the Bahamas, the USVI and other destinations). But Stephan correctly read the future and realized that the old ships would not be around for much longer and that once they were gone, a new generation of ships would be needed to replace them. And whoever produced the best version of these and figured out the best way to run them commercially, would own the market. That vision would eventually become the very blueprint for how cruise ships should be built and how cruise operations should be run, but back in the sixties most people dismissed his visions as so much pie in the sky ramblings from an overambitious cruise exec.
The 'Royal' Venture
In Norway Stephan managed to connect with the Skaugen brothers - Sigurd, Brynjulf, and Morits Skaugen of the venerable I.M. Skaugen Shipping Company (est. 1916) – and sell them on the future of custom-built cruise ships but the investment was still too rich for just one partner. Using their industrial network, they cast around for further investors and eventually partnered with Arne Wilhelmsen of Anders Wilhelmsen & Co (est. 1939) and Harry Irgens Larsen of Gotaas Larsen (est. 1946) – all becoming one-third partners in the venture. All three companies had made their fortunes off oil and cargo shipping, but in an industry as tight-knit and fraternal as Norwegian shipping, it's hard to imagine that they didn't also have some familiarity with the cruise phenomenon.
The formation of Royal Caribbean Cruise Line (RCCL) was announced in 1968 – a mere two years after the NCL start-up – and it launched its first custom-built cruise ship, the Song of Norway, in 1970, followed by two more in quick succession; the Nordic Prince in 1971 and the Viking Sun in 1972 (all three names obviously alluding to the Norwegian connection). All three ships were specifically designed for leisure cruising, constructed in Finland and mainly crewed by Norwegians – at least in nautical functions with officers’ rank. You can chart and date the development of the contemporary cruise industry in many ways, but as far as the development of modern, specialized cruise ships go, these three were the OG forefathers of the entire category of ships as we know it today. And with that Royal Caribbean was off to a flying start, entering a fierce race for market dominance with Norwegian Caribbean Line.
Now, both the biggest players in the budding North American cruise industry were operating with Norwegian-financed and largely Norwegian-crewed ships. From ordinary seaman to extraordinary executive the -Sens of Norway flourished in their new element; the Johansens, the Olsens, the Andersens, the Nilsens, the Kristiansens and many more (the suffix ‘-sen’ meaning ‘Son of’ in Norwegian) bounced around the industry and those that gathered the momentum to strike out on their own, did so – frequently using their 'Norski network' to gain traction. With their penchant for collaboration, Norwegian work culture is naturally very trust-based and there is no one a Norwegian trusts more than a fellow Norwegian, so whenever it came to sourcing partners and backing in new projects, it’s hardly surprising that Norwegians would usually reach homeward first. And it is no surprise that they would find plenty of willing partners, eager to get in on the action either. By this point, the entire Norwegian shipping industry had taken note of the success and rapid growth their fellow shipping magnates were enjoying in this new field and were actively seeking out similar arrangements to get in on the action.
Players from the Past
One such arrangement was Royal Viking Cruise line (1972-1998) - once again the product of an American entrepreneur summoning Norwegian maritime and financial strength to create a cruise adventure. In 1972 former P&O executive Warren Titus brought together three Norwegian shipping agencies; Bergenske Dampskibsselskab (Bergen Line) of Bergen, Nordenfjeldske Dampskibsselskab of Trondheim and A. F. Klaveness & Co. of Oslo, each contributing one ship to the concept; the Royal Viking Star, the Royal Viking Sky and the Royal Viking Sea respectively. And if you read Part I you'll know that Bergenske and Nordenfjeldske needed absolutely no introduction to the cruise phenomenon, having been the dynamic duo of Norwegian domestic cruising since the 1880's and masters of the international luxury cruise market in the interwar years. With such pedigree it's hardly surprising that Royal Viking Line would go on to become the gold standard of the North American luxury cruise segment and pave the way for later luxury cruise brands like Crystal, Seabourn and Silversea. And with their Norwegian-operated ships arrived yet more Norwegians in the North American cruise industry. Royal Viking would go on to be bought out by Norwegian Cruise Line in 1984 and eventually dissolved in 1994 but is to this day remembered as one of the greatest cruise brands of the early industry.
More Luxury Brands
That would not even be the only time Warren Titus teamed up with Norwegians to found a famous luxury cruise line – In 1987 he partnered with a consortium of Norwegian investors led by industrialist Atle Brynestad to create the luxury cruise line, Seabourn Cruises. Brynestad himself made his fortune in knitting and retail shopping and did not bring much shipping experience to the table, but his investors (and likely Warren too) were not shy about introducing him to people who did and Brynestad seemed to take to the new industry with enthusiasm and drive, becoming Chairman and CEO of Seabourn in the early years. Seabourn would eventually be bought out by Carnival Corporation in collaboration with – wouldn’t you know it – another consortium of Norwegian investors and Brynestad would then go on to serve on the board of Carnival Cruise Lines and as Chairman of Cunard Line Ltd. Like his previous partner, Warren Titus, Brynestad would also turn out to have more than one cruise line in him - in 2001 he founded the luxury cruise line Seadream Yacht Club which is still going strong to this day. Surprising absolutely no one, the ships of both luxury brands initially came with a majority of Norwegian command staff, though these days the crew composition is generally more international.
The Last of the Ocean Liners
A straight-up Norwegian cruise operation emerged with Norwegian America Cruises (1980 – 1984) operating the last remnants of the flag carrier Norske Amerika Linje (Norwegian America Line) passenger fleet. As laid out in Part I, Norske Amerika Linje was the main Norwegian transatlantic shipping line since 1910 and took the plunge into leisure cruising in the mid-1920's when declining immigration traffic forced ocean liners into cruise duty. However, cruising remained a sideline to their shipping operations until well into the 1960's. By the 1970's the transatlantic passenger traffic dried out completely due to competition with airborne travel, and NAL decided to divest itself of its remaining two ocean liners. The Sagafjord and the Vistafjord, were sold to Leif Höegh & Co – a Norwegian shipping company (est. 1927) operating mostly tankers and auto liners – and rebranded as Norwegian America Cruises (NAC) from 1980 and onwards.
NAC operated pretty unremarkably for four years (judging by the small size of its online footprint) but despite high ratings and a good reputation the company did not manage to stay afloat and folded in 1984. The ships stayed afloat though and retained their popularity - they would remain in circulation for an impressive 40+ years each (eventually bowing out in the 2010's as the Saga Rose and Saga Ruby respectively). With a sale to Cunard Line in 1984 they passed out of Norwegian hands, though not for long, as Norwegian engineering company Kværner ASA bought up Cunard Line in 1996, putting the ships back in Norwegian hands for a while. And the command staff? Yes, of course they were Norweigan and managed to remain so despite many changes of ownership and management in the lives of both ships.
Adventures with the Mouse
Another very successful US-Norwegian collaboration is that of Norwegian Bjornar Hermansen and American Bruce Nierenberg – both former executives with Norwegian Cruise Line – who in the early 1980’s decided to corner the family cruising market. Together they founded Premier Cruise Line (1983 – 2000), adding some vibrant color to the cruise scene with their ‘Big Red Boats’ and targeting the previously untapped segment of multigenerational groups (i.e. kids with parents and grandparents). The master stroke of this operation was to partner with Disney for use of their characters onboard and for land/sea combos involving stays at Disney World in Florida, basically becoming the Official Cruise Line of Walt Disney World. Premier Cruise Line came to define family cruising in the 1980’s and showed the mainstream lines that you could successfully target clientele beyond the traditional ‘Newlyweds and Nearly-deads’ crowd. Disney would eventually withdraw from the contract in 1993, leading to a new Premier partnership with Looney Tunes that went well for a while, until it suddenly didn’t. Premier Cruise Line eventually filed for bankruptcy in 2000. Disney decided they did not want to bother with partnerships anymore and instead dug into their Scrooge McDuck-like fortune to just build themselves a cruise line from scratch and that's how we got Disney Cruise Line.
A Norwegian Misadventure
Crown Cruise Line (1984 – 2001), later also known as Palm Beach Cruises, was the product of Norwegian self-made shipping tycoon Oddmund Grundstad (of Oddmund Grundstad Maritime Inc.) venturing into the leisure cruise market. He set up a budget cruise line operation, initially out of San Diego but soon moved to Palm Beach, Florida for operational reasons and pioneered that port as a base of cruise operations – initially mainly weekend / casino cruises to the Bahamas and just with the one ship, Viking Princess, though eventually sailing further afield, raising the brand experience to premium and building up a fleet of five ships. Grundstad was also working on a new cruise line, to be named Gulfstream Cruise Line – a more mainstream operation with two newbuilds. However, these plans never materialized before he overextended himself and ran into a heap of financial and legal trouble - his cruise operation foundered in 2000 and his ships were picked up by Commodore Cruise Line and Cunard Line.
Seriously, I could go on for a while yet. I haven’t even gotten to the Norwegian ancestry of Majesty Cruise Line (1992 – 1997) or to the fact that Renaissance Cruises (1989 – 2001) was wholly owned by Fearnley & Eger Rederi in Oslo, Norway or that former Royal Viking Cruises CEO and proud Norwegian, Thorstein Hagen, went on to found Viking Cruises – one of the largest and most successful high premium/luxury cruise lines encompassing river, ocean and expedition cruising. And these are only the cruise lines where I have been able to identify top management or financial backers as being Norwegian – surely there are countless more examples of Norwegian money, management and manpower hiding in the lower tiers of organizational charts or behind dummy corporations. But I think you get the picture now: For a nation with plenty of destination history but little to no domestic cruise industry or even a home market, Norwegians are almost comically over-represented in the contemporary Western cruise industry.
A Unique Starting Position
The marriage of Norwegian shipping money and skills to the nascent American cruise industry was an odd and seemingly random combination that really did seem to kick off with Kloster’s team-up with Arison, as portrayed here, and one that would only grow exponentially thereafter. What really drove Norwegians to invest and participate in the early stages of the American cruise industry is not widely explored but let me give it my best shot. While cruising had been around for a good 100 years at this point, it had mostly been on the fringes of ocean shipping. Designated ‘cruise lines’ had only started to come into existence recently and were mostly small-time, amateur leisure operators, operating a dozen or so second-hand ocean liners in a business frontier environment. By the mid-1960’s visionaries could tell that the success of the airliners would surely doom the ocean liners and that this would eventually create a demand for ships for leisure use, but there was no guarantee of success in such a market. Chances are very few people were looking at this and going ‘Wow, that looks like the beginning of a multi-million-dollar industry! Let’s get onboard with that’. But the Norwegians did - they had already seen it happen once before, back in their home fjords, and they had already managed once before to rise from nobodies of budget cruising to masters of luxury cruising.
Opportunity behind the Horizon
Now, maybe there are some inherent Norwegian character traits of high risk propensity and drive for innovation, perhaps born out of a history where those traits were frequently the only way out of a life of adversity, hardship and poverty, constantly urging them to change it up, take chances or challenge status quo to move ahead which - due to geography - most often meant moving out to sea. There certainly is a keen and innate understanding in Norwegians that opportunities lie beyond the ocean horizon and not behind the nearest mountain. Furthermore, in the geopolitically turbulent 1960's (Cuban Missile Crisis, Middle Eastern unrest, Vietnam War etc.) Norwegian shipping companies may also have been extra attentive to diversification opportunities, just in case the next world crisis would hit them right in the global supply chain moneymaker.
A Cooperative Development
The Norwegian affinity for trust-based cooperation for a common goal definitely helped finance many a new cruise enterprise – this is apparent from the many consortiums and collaborative efforts between competing shipping agencies to make cruise lines happen, often involving non-compete clauses or other self-imposed restrictions limiting individual aggressive growth in favor of cooperation and consensus. And these were largely diligently kept. This is another Norwegian national character trait, originating in times when small communities had to bond together and pool their resources to rise above the poverty, isolation and deprivation that Norwegian geography and government had saddled them with. In more competitively-minded cultures this would not have happened to the same extent.
Shipping was Key
Surely, the nautical aspect of cruising made all the difference to investment-happy Norwegian tycoons, or else they would have invested in land-based resorts / hotel chains instead (if a particular inclination towards leisure was their main motivation). But shipping they knew - whether those ships carried liquid fuels, dry cargo, containers or leisure-seeking tourists was incidental. As descendants of a people soul-bonded to the sea, they knew how to run ships and how to run a shipping line and that facet of the industry likely appealed to them the most. By a quirk of history Norwegians also got a leg up in branding thanks to the same obscure, maritime-based but largely peaceful and inoffensive history that Norwegian sailors had always enjoyed free and amicable passage under. ‘Norwegian’ as an adjective actually boosted the brand value of most cruise products it was affixed to, in as far as the one thing people knew about Norwegians (if they knew anything) was that they were generally great sailors and pleasant people. And why wouldn't you want to go cruising with sailors who knew their stuff and were pleasant to hang around? And if you think that is an inconsequential detail, I’ll just give you a moment to contemplate how differently branding would have worked out if a fledgling cruise operation had named itself ‘German Cruise Line’ (Nichts für ungut, liebe Leute!).
But as for what really motivated the Norwegians to get into the game, I can only venture the guess that it's their long and deep relations to the cruise phenomenon, the fact that most of these Norwegians grew up seeing ships of leisure plying their homeland fjords so consistently for more than a century, always bouncing back after world wars and recessions, progressively growing in size, volume and sophistication, not only gave them a familiarity with the cruise concept but a faith in its commercial viability and future. Whatever the reason, the budding cruise industry got a massive leg-up that they might not have found elsewhere, launching ships, careers and an entire industry on a sea of (largely) Norwegian shipping money.
So the next time you cruise the Norwegian fjords and find yourself outside on deck, taking in the magnificent scenery or meeting the locals in tiny villages, take a moment to appreciate that this landscape and these people are not just another cruise destination, but a very large part of the reason why we even have the contemporary cruise industry we have today.
This is the twentieth article in a series of historical retrospectives on the history of cruising prior to the industry formation in the 1960's. Although not academic papers, the articles are researched to the extent of my resources and ability and strive to be as historically factual as possible. If you enjoyed it, feel free to like, share or comment and follow me (or The Cruise Insider) for more instalments.