Canadian Princess Cruisers

[BCCRUSINGCOUPLE]

I think in time you will see some discounts as there will be less Canadians traveling question is how much And how long as long as the ships are full simple supply in demand.

 

 

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[Kamloops50]

Just ordered some Kindle books from the states.

Exchange rate was 1.4593 on my CC.

Rate from Princess at 1.45 not bad.

Edited February 1, 2016 by Kamloops50

[Cruise Junky]

Just ordered some Kindle books from the states.

Exchange rate was 1.4593 on my CC.

Rate from Princess at 1.45 not bad.

 

You got totally ripped off. And since when is Princess a credit card company and should profit from an exchange rate?

[Cruise Junky]

I think in time you will see some discounts as there will be less Canadians traveling question is how much And how long as long as the ships are full simple supply in demand.

 

 

Sent from my iPhone using Tapatalk

 

I haven't checked NCL today, but they were offering 25% to Canadians on Friday. RCL was around 28% I think. We paid 35% for HAL for 2017 so there are definitely deals out there. There's also a lot of package deal offers out there too. Check out Westjet vacations too

[RDC1]

You got totally ripped off. And since when is Princess a credit card company and should profit from an exchange rate?

 

Neither is Princess a currency exchange. They have to contract someone to handle their currency exchange, most likely a bank.

 

Since currency rates are set at time of booking, they have to forecast what they expect the exchange rates to be at time of full payment and when the cruise actually occurs. Now they are not setting it for each cruise and exact times, but it would include some hedge factor based upon projected future value. I expect that they have adjusted the rate too slowly as it fell and paid a substantial cost as a result. Not surprising if it is a little over the current exchange rate if they expect the cdn to fall a bit more. Even with that said the rate is not out of line for just taking the current exchange rate and bank fees into account.

 

So the rate they charge is probably a combination of the actual exchange rate, the exchange fees they pay, with a hedge factor adjusted by expected change of the exchange rate.

[kruisey]

Neither is Princess a currency exchange. They have to contract someone to handle their currency exchange, most likely a bank.

 

Since currency rates are set at time of booking, they have to forecast what they expect the exchange rates to be at time of full payment and when the cruise actually occurs. Now they are not setting it for each cruise and exact times, but it would include some hedge factor based upon projected future value. I expect that they have adjusted the rate too slowly as it fell and paid a substantial cost as a result. Not surprising if it is a little over the current exchange rate if they expect the cdn to fall a bit more. Even with that said the rate is not out of line for just taking the current exchange rate and bank fees into account.

 

So the rate they charge is probably a combination of the actual exchange rate, the exchange fees they pay, with a hedge factor adjusted by expected change of the exchange rate.

Still think if they gave us a break on room rates they would get more bookings and still make a good profit.The Cruise Company that gives a break to Canadians and the Canadians go to that line would profit when value of dollar increases.Folks should always consider 'Back to the future' in their portfolio:cool: .

[Cruise Junky]

Neither is Princess a currency exchange. They have to contract someone to handle their currency exchange, most likely a bank.

 

Since currency rates are set at time of booking, they have to forecast what they expect the exchange rates to be at time of full payment and when the cruise actually occurs. Now they are not setting it for each cruise and exact times, but it would include some hedge factor based upon projected future value. I expect that they have adjusted the rate too slowly as it fell and paid a substantial cost as a result. Not surprising if it is a little over the current exchange rate if they expect the cdn to fall a bit more. Even with that said the rate is not out of line for just taking the current exchange rate and bank fees into account.

 

So the rate they charge is probably a combination of the actual exchange rate, the exchange fees they pay, with a hedge factor adjusted by expected change of the exchange rate.

 

Bottom line is Princess is a business and has a right to charge what they want. Also as an informed consumer I have a right to call them on the carpet for price gauging during a time that a lot of resorts and other cruise lines are trying to attract Canadian business. There are a lot of other options out there and by raising the rate 5% above the true rate Princess proves they don't care which we will remember.

[RDC1]

Bottom line is Princess is a business and has a right to charge what they want. Also as an informed consumer I have a right to call them on the carpet for price gauging during a time that a lot of resorts and other cruise lines are trying to attract Canadian business. There are a lot of other options out there and by raising the rate 5% above the true rate Princess proves they don't care which we will remember.

 

As I indicated about the amount they are charging most likely represents their expected actual cost. Now you would have more of a claim if they required you to make full payment at the time you book and lock in the rate. Since they don't they bear the risk of additional loss if the change rate worsens. You don't because if the rate improves prior to final payment date you can always cancel and rebook at a better rate. They on the other hand have to honor the booked rate. Risk analysis in international transactions is an interesting subject.

 

You get the benefit of a locked in rate. Now if you don't think there is additional risk and bank exchange fees then go ahead in book in US dollars and bear the currency risk and exchange costs yourself.

Edited February 1, 2016 by RDC1

[Cruise Junky]

As I indicated about the amount they are charging most likely represents their expected actual cost. Now you would have more of a claim if they required you to make full payment at the time you book and lock in the rate. Since they don't they bear the risk of additional loss if the change rate worsens. You don't because if the rate improves prior to final payment date you can always cancel and rebook at a better rate. They on the other hand have to honor the booked rate. Risk analysis in international transactions is an interesting subject.

 

You get the benefit of a locked in rate. Now if you don't think there is additional risk and bank exchange fees then go ahead in book in US dollars and bear the currency risk and exchange costs yourself.

 

Or option C. Book with a cruise line with a more favourable rate = done

[RDC1]

Still think if they gave us a break on room rates they would get more bookings and still make a good profit.The Cruise Company that gives a break to Canadians and the Canadians go to that line would profit when value of dollar increases.Folks should always consider 'Back to the future' in their portfolio:cool: .

 

To put this into perspective approximately 3.4% of cruise passengers come from Canada, compared to 51.7% from the US. After the US at 51.7%, comes the UK at 8.1%, Germany at 7.7%, Italy at 4%, and Australia at 3.6%. Canada is next tied with Brazil.

 

Now you have a higher percentage then that for Caribbean cruises, but not an over whelming percentage when it comes to developing corporate pricing strategy. Statistically the business impact, when you consider new customer rates, line expansion, ships shifting out of the competitive (low price) Caribbean area into higher price Asian markets, etc. I don't think the "back to the future strategy" would result in better long term economics.

 

Now considering that RCCL has a much higher percentage of their fleet capacity in the Caribbean they might be more sensitive to loss of Canadian passengers which would seem to be reflected in their willingness to take a loss on currency exchange.

Edited February 1, 2016 by RDC1

[RDC1]

Or option C. Book with a cruise line with a more favourable rate = done

 

Selecting a line that chooses to take a loss on currency exchange is a far cry from saying one is gouging because they are charging their actual costs.

 

As a consumer you can always make such a decision to go for a discount. However, you were claiming that Princess was gouging. Two different things.

 

The amount Princess is charging seems to be in line with they actual expected currency costs.

 

It does not appears that you can save much by booking in US dollars and dealing with the mechanics yourself.

Edited February 1, 2016 by RDC1

[Cruise Junky]

Selecting a line that chooses to take a loss on currency exchange is a far cry from saying one is gouging because they are charging their actual costs.

 

Lol. It's not their actual cost. They make their money from the onboard spend and we're really, really good at that, and it's all in US $ but their gauging of cabin prices will preclude me from that. So instead of us buying drink packages, gambling and specialty restaurants every second night they can stick to their tea totalling US based elite passenger that spends squat onboard. I'm all good.

 

Ps. They are gouging. While most cruiselines..even the ones that you can't book in Cdn such as Oceania are giving currency discounts, Princess are charging an extra 5%

Edited February 1, 2016 by Cruise Junky

[RDC1]

Lol. It's not their actual cost. They make their money from the onboard spend and we're really, really good at that, and it's all in US $ but their gauging of cabin prices will preclude me from that. So instead of us buying drink packages, gambling and specialty restaurants every second night they can stick to their tea totalling US based elite passenger that spends squat onboard. I'm all good.

 

Ps. They are gouging. While most cruiselines..even the ones that you can't book in Cdn such as Oceania are giving currency discounts, Princess are charging an extra 5%

 

It is their actual expected currency exchange costs, when looked over the period of time the rate in in effect (I used to approve such models for an international business). As I said before if it is not, then pay in US dollars and manage the exchange yourself. If you have a credit card that does not change exchange fees you can save 2-3%. The credit card makes its ways in other fashion. On the other hand corporations tend to pay a similar rate, a few hundred basis points in exchange.

 

Bottom line is you want a discount from the actual currency costs. Which other set of passengers do you want ot subsidize that discount?

 

Considering Oceania price structure I would not doubt they will provide some discount. Also am not surprised if RCCL does considering the number of cabins they have in the caribbean (an area where there tends to be a higher concentration of Canadian cruisers then their overall cruise passenger percentages).

Edited February 1, 2016 by RDC1

[kruisey]

To put this into perspective approximately 3.4% of cruise passengers come from Canada, compared to 51.7% from the US. After the US at 51.7%, comes the UK at 8.1%, Germany at 7.7%, Italy at 4%, and Australia at 3.6%. Canada is next tied with Brazil.

 

Now you have a higher percentage then that for Caribbean cruises, but not an over whelming percentage when it comes to developing corporate pricing strategy. Statistically the business impact, when you consider new customer rates, line expansion, ships shifting out of the competitive (low price) Caribbean area into higher price Asian markets, etc. I don't think the "back to the future strategy" would result in better long term economics.

 

Now considering that RCCL has a much higher percentage of their fleet capacity in the Caribbean they might be more sensitive to loss of Canadian passengers which would seem to be reflected in their willingness to take a loss on currency exchange.

We are their North American neighbors but I did not realize our ratio was so lowly.No wonder we have no influence.

[Cruise Junky]

It is their actual expected currency exchange costs, when looked over the period of time the rate in in effect (I used to approve such models for an international business). As I said before if it is not, then pay in US dollars and manage the exchange yourself. If you have a credit card that does not change exchange fees you can save 2-3%. The credit card makes its ways in other fashion. On the other hand corporations tend to pay a similar rate, a few hundred basis points in exchange.

 

Bottom line is you want a discount from the actual currency costs. Which other set of passengers do you want ot subsidize that discount?

 

Considering Oceania price structure I would not doubt they will provide some discount. Also am not surprised if RCCL does considering the number of cabins they have in the caribbean (an area where there tends to be a higher concentration of Canadian cruisers then their overall cruise passenger percentages).

 

I don't want a discount. I want a fair price. They have a Vancouver division, no need to do an any exchange. True exchange rate is less than 1.4. I refuse to be gouged for 1.45. They are looking to make money on Canadian exchange. That is deplorable to me and will not be forgotten. You and I can debate this until the cows cone home it will not change Princess attempting to rip off Canadians. If they'd have raised it to 1.40 then fair enough, sucks, but if is what it is and still the highest of major cruiselines, 1.45 is gouging.

[Cruise Junky]

And where did you get your stats from? Most official reports I see we're around 10% which is not insignificant and for Alaska cruises I'd bet we are much higher than that.

[RDC1]

I will make the following forecast. The longer the time goes on with the CDN trading at a substantial discount to the US dollar the more the exchange rates offered by the cruise lines will move to match market rates.

 

When this started the models would tend to assume a return to mean and as such would project a discounted rate (charge less then the actual rate). The longer the rates remain at their current level, the more that the models will move to current level (think of it as kind of like a moving average calculation).

 

Some cruiselines may choose to slow their model or ad some kind of rate discount, but these will tend to disappear if the exchange rate seems to settle into a new normal (actually a return kind of the old normal). It has only been the last 10 years that the CDN has routinely been less then 1.2 to the US dollar. As recently as 2003 it has been as high a 1.5 CDN to the USD.

 

you will see similar moves in the cost of imported products to Canada. Their Canadian price will move over time to reflect actual acquisition costs, including exchange rates. I would not be surprised to see that it is already moving in that direction for items with short shelf life such as supermarket produce.

Edited February 1, 2016 by RDC1

[RDC1]

And where did you get your stats from? Most official reports I see we're around 10% which is not insignificant and for Alaska cruises I'd bet we are much higher than that.

 

The stats are 2013. They are actual worse today due to increases in Asia in the last two years.

 

http://www.statista.com/statistics/287114/cruise-passenger-share-by-source-country/

 

 

it is also in this report, though as number of passengers and not percentages

 

http://www.cruising.org/docs/default-source/research/global_cruise_impact_analysis_2013.pdf?sfvrsn=2

Edited February 1, 2016 by RDC1

[RDC1]

I don't want a discount. I want a fair price. They have a Vancouver division, no need to do an any exchange. True exchange rate is less than 1.4. I refuse to be gouged for 1.45. They are looking to make money on Canadian exchange. That is deplorable to me and will not be forgotten. You and I can debate this until the cows cone home it will not change Princess attempting to rip off Canadians. If they'd have raised it to 1.40 then fair enough, sucks, but if is what it is and still the highest of major cruiselines, 1.45 is gouging.

 

Their financials are reported in US dollars. That means everything is converted to US dollars for financial reporting purposes. The currency receipt and movement means that in addition to conversion for financial purposes to is actually converted in the banking system as well.

[RDC1]

And where did you get your stats from? Most official reports I see we're around 10% which is not insignificant and for Alaska cruises I'd bet we are much higher than that.

 

The two areas where the concentration of Canadian cruisers is Caribbean and maybe Alaska (though has seen more a tendency to go south for the winter instead of north for the summer). Of course both of those areas tend to be high concentrations of capacity and often heavily discounted as is.

[Kamloops50]

The strength of the USD affects all currencies not just Canadians. The CDN hasn't changed much against the pound euro or Australian dollar.

[RDC1]

We are their North American neighbors but I did not realize our ratio was so lowly.No wonder we have no influence.

 

Note these are world wide cruise passenger rates. More of an impact in the Caribbean then the 3.6% world wide, but not a real high number. About 770,000 per year, about the same as China in 2013.

[RDC1]

The strength of the USD affects all currencies not just Canadians. The CDN hasn't changed much against the pound euro or Australian dollar.

 

The CDN has changed more than most, along with the Australian dollar. They have moved in lock step for the past five years. Both are natural resource driven economies.

 

The GBP has dropped the least vs the USD. The Euro less then the AUD. Of course it depends upon when exactly you pick. For example in 2012 the CDN could buy .8122 Euro. So compared to that time frame the CDN has lost 18% of it purchasing power. The recent peak vs the AUD was in 2008 where it as 1.2462 (a drop of 19% between then and current)

 

If we go back to 5 years and compare 2010 to present

 

Compared to the CDN where 1 CDN can buy

 

GBP 2010 .6487 Current .4861 reduction of 25%

AUD 2010 1.0712 Current 1.0062 reduction of 6%

Euro 2010 .7195 Current .6694 reduction of 7%

USD 2010 .9572 Current .7053 reduction of 26%

Edited February 1, 2016 by RDC1

[racj846]

No its not gouging!! I am looking at the rate right now as I type this and it is 1.3989. Remember that this is a wholesale rate.

Go to any bank and try to get that rate - it won't happen. More likely you can sell US$ at about 1.35 and buy them at 1.45. The difference is how the banks make money.

Princess deals in US$ so they have to buy them with our Cdn $ - they might get a slight break but at the end of the day they will have to pay close to the 'public' rate.

[Cruise Junky]

No its not gouging!! I am looking at the rate right now as I type this and it is 1.3989. Remember that this is a wholesale rate.

Go to any bank and try to get that rate - it won't happen. More likely you can sell US$ at about 1.35 and buy them at 1.45. The difference is how the banks make money.

Princess deals in US$ so they have to buy them with our Cdn $ - they might get a slight break but at the end of the day they will have to pay close to the 'public' rate.

 

Sigh... As I stated earlier I can walk across the street and buy it for 1.408

 

http://www.vbce.ca/rates/major-currencies

 

Banks exchange rates suck. Only people with no other options buy their currency from banks.

Edited February 1, 2016 by Cruise Junky