RSSC adds fuel surcharge

[oceanbear]

Looks like we'll be paying a bit more than we expected in 2005

 

http://www.rssc.com/rss/PDF%20Files/Fuel%20Surcharge%20Statement1.pdf

[Call me Ishmael]

Thanks for the info.

 

$20 per person per week is pretty modest as long as they don't make it a practice of adding on for such things.

[Leejnd4]

Honestly, this is the first time I've heard of RSSC adding anything on, so I think it's clear it's not a standard practice. I hope this doesn't get blown out of proportion so that it appears to be something more nefarious than it is. The bottom line is, fuel prices have gone up. The fact that they are reflecting these charges as a fuel surcharge instead of just raising their prices seems like they are doing this so that if/when fuel prices drop, they can drop the charge!

 

The thing I respect the most is, in spite of all that verbiage in their contract that would seem to give them the right to do so, they are NOT passing these additional charges on to anyone who already booked their cruise. Now THAT'S caring for one's customers! :)

 

LeeAnne

[A J Theodore]

Fuel prices went up some time ago. I hope that LeeAnne is right that when/if they go down, the surcharges will disappear. Of course, with current levels of demand for oil products (esp., China), I don't see that as likely to happen soon.

 

My real fear is that with the returned popularity of cruising and the higher levels of occupancy on all cruise lines and very few new ships coming on line this year, cruise lines see this as an opportunity to raise fares now (supply and demand and all that). If they want to raise fares and believe that the traffic will bear it, I would rather they do this by raising their prices rather than through "fees." I don't want to see my cruise fares start to look like the phone bill - a low price with lots of "fees". I also hope that RSSC does not intend to add new fees to its cruise fare and I further hope that it does not intend follow the likes of Carnival, with its surcharges for specialty restaurants, etc.

[new_cruiser]

The thing I respect the most is, in spite of all that verbiage in their contract that would seem to give them the right to do so, they are NOT passing these additional charges on to anyone who already booked their cruise. Now THAT'S caring for one's customers! :)

LeeAnne

That was what I thought in the first glance, but if you read the message more carefully you will see that they are adding the charge to existing bookings sailing from early May on as well as to all new bookings. They are showing some restraint since the contract lets them add the surcharge to closer sailings but they are protecting all current bookings. The surcharge is fairly modest at this point - $20pp for a week wouldn't be likely to change my mind about a cruise and it seems reasonably restrained given the fuel costs.

 

My concern would be similar to AJ's. Is this the camel's nose in the tent? They made it clear that they might "adjust" the surcharge based on fuel prices so it can go up.

[goodshape]

Adding fees is an absolute pet peeve of mine.

Airfares in Canada bear no resemblance of the final cost of the flight.

In Dec 2004 I had a return flight from Toronto-Orlando at C$49.00

The final cost after taxes, fuel surcharge, airport fee, US customs fee, security fees, etc etc etc (+ coffee for the chairmain?) was C$244.00

In otherwords the surcharges were C$195 or about 400% of the original trip.

 

I hope that the cruise industry doesn't head down this path. As far as I'm concerned the only charges that should be changed/added are non-controllable fees such as port charges or REAL Taxes. ALL the other costs can be hedged against by either buying the items in advance or buying futures. If you want bookings 18 months ahead then you need to forcast a price for 18 months ahead.....

[JDRMYS]

Does anyone else remember that in the mid-1970s, during a major fuel shortage (and even and odd days at gas stations), all cruise lines added fuel surcharges. When the crises ended, the surcharges ended. However, in those days, fares were increased annually by almost all lines.

[dougburns]

RSSC is not the only line doing this. They are being up front about it though and making sure it is only seen as being temporary. Other lines are just jacking their prices up. The increase does NOT affect cruises already booked.

[Call me Ishmael]

:confused: The news release makes it clear that it does apply to existing bookings for cruises from May on. (Last sentence of first paragraph)

[dougburns]

Not so! We're booked for Mariner in Nov and there was no price increase. Our TA said she had checked with FLL and it does not affect cruises already booked.

[Leejnd4]

Well, my cruise embarks on May 1, and I haven't heard anything about any additional fees. We've paid in full, so at this point I'm not sure how they would assess them. It would be awkward to come back to us and ask for more money -- that would certainly not endear their customers to them, which seems very contrary to how RSSC does business. (Unlike some *other* companies we've heard of!) But if they do ask me for more money, I'll be sure to let you know. :)

 

LeeAnne

[dougburns]

I am a bit red faced. The surcharge is supposedly going to be applied if the cruise has not yet been paid in full. RSSC has not started applying the charges yet though. Sorry for my error.

[Leejnd4]

Well that's good to know! Honestly, I would have been very surprised if they came back and asked me for more money after I'm paid in full, as that seems so out of character for that company and how they seem to want to be viewed by their customers. :)

 

LeeAnne

[jhp]

While I don't like the fact they are tacking on fuel prices, I see that every month in my electric bill! A mere $20-50 is not going to make a difference to me. But they'd be wise to tell passengers in the future.

[Newdoc2002]

Our travel agent called us and told us this surcharge was $150 for the both of us for the June 4th, P.G. ??:confused:

 

This also includes the air surcharge as well. That's pretty stiff. Perhaps if I offered to row, I could get a discount. Ouch! Should of paid in full sooner, but oh well.

[Call me Ishmael]

What air surcharge? I'd want to know more specifics on that part.:confused:

[oceanbear]

An updated statement was issued on Feb 18th. RSSC added $30 P/P E/W on PG Air.

 

http://www.rssc.com/rss/about/Press%20releases%20(pdfs)/Fuel%20Surcharge%20Statement%20feb%2018.pdf

[Call me Ishmael]

Hmmm. I can't find much about fuel surcharges charged by airlines except a $10 boost by Northwest Air announced on 2-24. Not a good practice in my opinion.

 

What's next? A surcharge because Coke raised its prices a penny a can?

[bbcstt]

Just made my final payment for the June 8, 2005 Navigator to Bermuda cruise. The final balance paid included no fuel or any other surcharge. No air is involved.

 

Maybe this surcharge applies only for cruises with air segments booked through RSSC.

[aaannnthony]

I read this thread briefly at it's incept, but, not further until just now.

 

We booked a 2005 cruise while onboard Voyager's 15 day combo Med/Transatlantic to FLL in November, so, didn't figure the new surcharge would affect previous bookings. I checked the Rad. web-site and saw that cruise prices were changed based on the increase for the surcharge. Okay, so all's well.....they've increased the price for the "surcharge" of $2.85pp/per day, but, we're protected, having booked and deposited.

 

Today, I learn, not so!! We've been advised that our "contract" has been amended.....our booking cost has been increased for the "fuel surcharge".

Talk about "nickle and diming"!

 

Conclusion: a very dumb move by, obviously, a very minor league operation!

[cruiseyguy]

Retroactively applying such a small charge tells me things must be pretty tight at RSSC, considering the "goodwill" fallout from such a move.

[aaannnthony]

"On the money", but, still, very, very "DUMB"!!

[Kathy Z]

We booked our June 11 PG trip last Sept. 1 (an onboard booking). In addition to the 2.85 per person/per day fuel surcharge while on the ship we got hit with $30 per person each way over the Pacific on Air Tahiti Nui booked through Radisson. This all added up to an additional $177 (it is a 10 night itinerary). I'm not real happy about it, but I know from reading the contract that they have a right to add these charges.

[Call me Ishmael]

Since they've already sold two ships and are now "reusing the staples," my guess is that RSSC is being spruced up for sale. Often an owner will cut every cost possible to make the financials look more attractive -- often at a loss of customer good will.

[NHcruisers]

Ishmael--

 

First, they only sold ONE ship, the Song of Flower which was getting long in the tooth as it first entered service in 1986 as the Exploration Starship, later refurbished/rebuilt in 1989, and subsequently re-entered service in 1990 as Song of Flower. The ship, with dated technology, would have had a tough time meeting increasingly stringent SOLAS safety requirements without considerable additional expense. BTW, the industry average age of a ship that services the North American market (most of the pax revenue is from North America) is about 14 years. The ship carried 180 pax and was economically inefficient to operate due to pax capacity and dated technology. Although the ship was loved by many, it was a wise business decision to sell her.

 

Second, the Diamond was NOT sold by RSSC as they did not own her, Finnish banks did. RSSC had a ten year lease on the Diamond. RSSC did have the right to match at the end of the lease, any lease or purchase offer from any other party. An offer was made to purchase the Diamond, and since RSSC did not want to own the Diamond (see above in terms of average age of NA service), they passed. They then tried to delay the transfer of ownership so that they could complete the 05 cruising schedule. Despite offering 2-3 million dollars (my guess) to delay the transfer, they incurred a 4 million dollar plus hit in terms of credits, lost profits and the like for affected Diamond cruisers. RSSC did NOT want to lose the Diamond at this particular time.

 

RSSC DID have an option at T. Mariotti yards to build another Voyager class ship which RSSC let expire at the end of 2004, before they knew they would be losing Diamond early. My guess is that they will shortly announce a new build at T. Mariotti, inspite of the unfavorable exchange rate. (A Voyager built today would cost 70 million more today then it did a few years ago because of the exchange rate).

 

Industry consolidations in the cruise industry take place during industry contractions, not when bookings are up over 40% over the previous year. RSSC has NO problems filling berths today.

 

RSSC is trying to re-brand with a consistent message ..."Luxury cruising on an all- suite ship". Their previous inventory of ships made this re-branding difficult.

 

IMHO, there is nothing in their actions which would signal imminent sale of the company. On the contrary, their actions are consistent with "building the brand".

 

While I do not profess to be an expert on RSSC, I do have 20 plus years experience in mergers and acquisitions. RSSC's recent actions, and comments by Mark Conroy, are not consistent with a company that is sprucing itself up for sale. They ARE sprucing themselves up with a ship inventory that will allow clear messaging and differentiation.

 

Bill