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New cruise debacle for Carnival as ship stuck in port

By Colleen Jenkins and Phil Wahba

(Reuters) - A Carnival Cruise Lines ship with 5,600 passengers and crew was stuck at a Caribbean port with equipment trouble on Thursday, a month after another Carnival vessel was disabled by a fire that trapped thousands of passengers at sea for days.

The incident is the latest black eye for an industry battered by problems ranging from norovirus outbreaks to the Costa Concordia accident in Italy in 2012 that killed 32 people.

Carnival Corp said the cruise ship Carnival Dream was stuck in port in St. Maarten after its emergency diesel generator malfunctioned during testing on Wednesday. The liner, among the company's largest, was on a weeklong cruise and had been due back in Port Canaveral, Florida on Saturday.

The problem caused temporary disruptions to elevator and toilet services but the ship never lost power, the company said, adding that only one public toilet had overflowed.

Carnival Corp said it was arranging to fly the passengers, via charter flights and regularly scheduled flights from the Caribbean island, to Orlando or their final destination. Passengers will get a refund equal to three days' worth of travel and half off a future cruise.

The Carnival Dream is being held at dock while company engineers work on the problem. The company said passengers were free either to leave the ship and go into port or to remain onboard until their flights.

The cruise industry has proven resilient in the face of a series of disasters. The Cruise Lines International Association (CLIA) projects that the number of people taking cruises this year will rise 3.3 percent. Carnival Corp and its smaller rival, Royal Caribbean Cruises Ltd, have said bookings are recovering from a slump following the Costa Concordia accident.

But a slew of headlines about mechanical problems and passengers stranded at sea without functioning toilets - coming at the busiest time of the year for bookings - could take a toll, especially if it deters potential first-time passengers.

"It's first-time cruisers that will have issues. This is definitely a PR (public relations) concern," said Morningstar analyst Jaime Katz. "This is some inflection point."

Carnival canceled the Carnival Dream's next voyage, which had been scheduled to start on Saturday.

ON HEELS OF REVIEW LAUNCH

Kris Anderson, a reporter for Memphis TV station WREG and a passenger on the Dream, told CNN his friends had chided him for booking a Carnival cruise.

"I said, 'What are the odds of it happening to two ships in such a short period of time?'" he told CNN. "Look what happened now."

The latest incident comes two days after Carnival said it had launched a comprehensive review of its entire fleet following a fire that crippled its Carnival Triumph in the Gulf of Mexico last month.

An engine-room fire knocked out power and plumbing throughout most of the Triumph, which was carrying more than 4,200 people. Passengers described an overpowering stench in parts of the ship and complained that toilets and drainpipes had overflowed.

The Triumph eventually was towed into port in Mobile, Alabama, by tugboats.

The company has assembled teams of fire safety experts, naval architects, electrical and mechanical engineers and engine manufacturers to conduct its own investigation, Carnival Cruise Lines President and Chief Executive Gerry Cahill said on Tuesday.

The CLIA's website said a typical cruise ship has more than 60 safety, environmental and health inspections annually. The U.S. Coast Guard inspects all cruise ships in the United States to certify compliance with federal and international regulations.

Over the weekend, another Carnival ship, the Carnival Elation, had to get a tugboat escort down the Mississippi River after a mechanical problem.

Carnival Corp shares were down 0.2 percent at $35.63 in midday trading in New York on Thursday.

(Reporting by Colleen Jenkins, Phil Wahba, Dhanya Skariachan and Kevin Gray; Editing by John Wallace and Dale Hudson)

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