In a 1996 interview with the Miami Herald, Micky described the differences between himself and his father thus: "Ted is more entrepreneurial, more creative. I am more administrative and competitive." Andrew Vladimir, the former FIU professor, has seen Micky's management style in action. "He's a delegator in general, but he operates with a great deal of information," Vladimir comments. "He's what I call a walk-around manager; he watches the ships, he watches where they're built, the ports. But he does delegate the decision-making." (Through the public-relations office of Carnival Corp., Micky Arison declined to be interviewed about his father's death, his family history, or anything else for this story.)
Micky's mettle would be put to the test immediately. When he took control, some financial experts questioned whether Carnival could maintain the spectacular growth it had enjoyed during Ted's reign. High fuel costs were making the industry nervous about the future. By late 1990 Carnival's stock was trading at $13 per share, down from $25 that June. Micky put on a happy face. "We are recession-resistant, not recession-proof," he said. Still, a 1990 story in Forbespredicted that "Carnival's party may not be over, but it is certainly quieting down."
Steve Satterwhite
Steve Satterwhite
There's no telling whether the new arena will bring prosperity downtown, but it will definitely deliver for this guy
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Micky took the helm during probably the most challenging period in the company's history, asserts James Winchester, a cruise-industry analyst with Lazard Frere in New York. In 1991 Carnival Corp.'s profits dipped to $80 million because the company used much of its cruise-line profits to bail out the unprofitable Crystal Palace resort and casino, which it had built in the mid-Eighties. By 1992 profits jumped back up to $277 million, according to Winchester.
Micky also continued his father's strategy of acquiring other cruise lines. Carnival acquired Seabourn in 1992; a 30 percent stake in Britain's Airtours in 1996; Costa Crociere in 1997; and Cunard Line, Ltd., in 1998. (In a bit of historical irony, Carnival now appears poised to gobble up Norwegian Cruise Line. In the early Seventies, Ted Arison started Carnival with money he had seized from Norwegian's predecessor.) "Carnival has been adamant about keeping their different brands separate, not merging them into one amorphous cruise line," comments Laura Hughes, senior cruise editor with the weekly Travel Agent Magazine. "That's worked very well for them, because ... some clients want the large, traditional luxury cruise ship, some want the high-energy, more youthful experience, and some want the sailing cruise."
Despite his early success, Micky had his share of flops, especially the merger of his Carnival Airlines with Pan Am Airlines in 1997. After Pan Am declared bankruptcy in early 1998, Arison's $65 million stake in the carrier was worthless. In October Chief Executive magazine denounced Carnival's board of directors as one of the "Five Worst Boards" in the world. "It seems that most of our worst boards just don't get it," the article states. "They choose insiders and sycophants and beholden suppliers to be their directors instead of strong, competent, experienced people. They don't have women or minority directors. They like to have their relatives on board."
Chief Executive called Carnival a "family-dominated corporate maze." The magazine noted that nine of the sixteen board members are either family members, corporate officers in Carnival or its subsidiaries, or "representatives of services suppliers to Carnival.... This company ... should start cleaning up its act and instituting some effective corporate governance measures."
Nevertheless Micky's strategy received the ultimate benediction in 1996. "Micky made me more money than I ever made for him," Ted Arison told the Miami Herald. "I think he did a better job than I did."
The Arisons have been beating back a lot of fires lately. In July 1998 Carnival's Ecstasy steamed along Miami Beach, gushing smoke from its stern. In November of that year, the upper reaches of the AmericanAirlines Arena, which a firm controlled by Micky Arison manages, burned all day after some welders accidentally turned their torches on wooden shoring. Then blazes on the Tropicale (this past September) and the Celebration(January 12) frightened passengers and made headlines, though no one was hurt.
Numerous metaphorical conflagrations also have broken out, many of them following a series of New York Times articles by reporter Douglas Frantz titled "Sovereign Islands." Examinations of the cruise lines' mistreatment of foreign employees, the effects of the industry's tax-free status, and, perhaps most sensationally, the Jane Doe rape case, sparked criticism of the company and its competitors across the nation. Reports on the Jane Doe lawsuit drew the most ink after Carnival was forced to disclose there had been 108 cases of sexual misconduct, including 22 assaults by crew, against passengers on its ships during the past five years.
In a sworn deposition in the case, Carnival president Bob Dickinson said Micky Arison told him not to cave in to pressure from the plaintiff's lawyers. "[Micky] was concerned about the negative publicity attached to [the lawsuit and the disclosure]," Dickinson testified. "[Although] we felt we had a strong case ... I was given to understand that if we didn't settle the case quietly with Jane Doe, that there would be, in so many words, a PR circus." Industry analyst Jim Winchester downplays the financial impact of the incidents. "I don't think the publicity will impact the company's stock much," he comments. "Investors have put them in the correct context. They are something that needs to be fixed, but they are not a fatal flaw."
