Ten Years From Now...... HAL

[navybankerteacher]

One of the biggest questions is: Who will have disposable income. For a certain age, pensions have disappeared. And those people didn't plan on it. How can the cruise lines market to those people?

 

Yes, private defined benefit pensions have largely disappeared - but their replacement by defined contribution plans and 401- k's means that (except for those with no long term thinking) the next generation of retirees will be spending. Additionally, with every passing year, there is a growing number of government retirees coming along.

 

The cruise industry - who have probably studied trends before investing in new builds - seems to think that a market will remain. I expect that the market will bifurcate - between the mass who want economy cruising and the much smaller segment who will pay for luxury - so we will likely see more 4,000 + mega ships for the masses and yacht-like smaller boutique lines. There will, however remain a niche in the middle - which a line like HAL might try to fill - with a few mid-sized ships; of which I think their Pinnacle will only be the first.

[iancal]

We do not care if HAL, or for that matter any other existing cruise line, is in business ten years from now.

 

All we will care about is if there are a number of good cruise lines at that time and the cruises are affordable.

 

Don't care about the name on the ship. More interested in value, cruise experience, and itinerary.

[Tarpeian Rock]

Yes, private defined benefit pensions have largely disappeared - but their replacement by defined contribution plans and 401- k's means that (except for those with no long term thinking) the next generation of retirees will be spending. Additionally, with every passing year, there is a growing number of government retirees coming along.

 

The cruise industry - who have probably studied trends before investing in new builds - seems to think that a market will remain. I expect that the market will bifurcate - between the mass who want economy cruising and the much smaller segment who will pay for luxury - so we will likely see more 4,000 + mega ships for the masses and yacht-like smaller boutique lines. There will, however remain a niche in the middle - which a line like HAL might try to fill - with a few mid-sized ships; of which I think their Pinnacle will only be the first.

 

 

 

Still, there are some very scary statistics regarding how poorly-prepared the majority of Baby Boomers are for retirement - what a small percentage of BB's actually have enough savings/investments to see them into their 80's. Once the first joy of retirement is past, a lot of BB's might take a cold, hard look at their finances and realize that their cash flow might not support the kinds of vacations they had imagined.

[BruceMuzz]

Still, there are some very scary statistics regarding how poorly-prepared the majority of Baby Boomers are for retirement - what a small percentage of BB's actually have enough savings/investments to see them into their 80's. Once the first joy of retirement is past, a lot of BB's might take a cold, hard look at their finances and realize that their cash flow might not support the kinds of vacations they had imagined.

 

The new Chinese Middle Class - flush with disposable income - is now larger than the entire population of the USA. It is going to get much, much larger over the next 10 years. They are already selling more American cars in China than they are in the USA. The mass market cruise lines will have no problems finding heads to put on those beds.

[navybankerteacher]

The new Chinese Middle Class - flush with disposable income - is now larger than the entire population of the USA. It is going to get much, much larger over the next 10 years. They are already selling more American cars in China than they are in the USA. The mass market cruise lines will have no problems finding heads to put on those beds.

 

And, if the doom-sayers are correct in their extreme worst case scenarios about the future of the US economy, we may see US citizens lining up for jobs as stewards on cruise ships which they cannot afford to ride as passengers.

[sppunk]

The new Chinese Middle Class - flush with disposable income - is now larger than the entire population of the USA. It is going to get much, much larger over the next 10 years. They are already selling more American cars in China than they are in the USA. The mass market cruise lines will have no problems finding heads to put on those beds.

 

It's going to get interesting when that Chinese self-inflated economical bubble pops.

[Sir PMP]

Ten Years From Now...... HAL

 

I hope HAL and Seabourn will merge, so we have some small ships to reach the small ports and let the Pinnacles do the 5 ports they can get in to.

 

No Smoking!!

 

All ships have a tamarind restaurant

[navybankerteacher]

Ten Years From Now...... HAL

 

I hope HAL and Seabourn will merge, so we have some small ships to reach the small ports and let the Pinnacles do the 5 ports they can get in to.

 

No Smoking!!

 

All ships have a tamarind restaurant

 

What are you talking about: "...let the Pinnacles do the 5 ports they can get in to"?

[Chelly]

I frequently read and hear of many long-time HAL fans switching to Celebrity and NCL.

 

NCL has had a future-looking plan for many years now as does Celebrity with it's S Class.

 

Unless HAL pulls out all the stops with it's Pinnacle Class ships, I fear it won't get out of the rut it is digging itself into.

[mariner]

Really hope HAL and Seabourn don't merge. The products are so different.

 

China will go through its bubble. Hell, it already is. But there's a middle class there that will grow unlike the US, which, pensions pulled away, will die on the vine.

 

Did someone really suggest First Class doesn't subside behind the curtain?

[POA1]

The new Chinese Middle Class - flush with disposable income - is now larger than the entire population of the USA. It is going to get much, much larger over the next 10 years. They are already selling more American cars in China than they are in the USA. The mass market cruise lines will have no problems finding heads to put on those beds.

The Chinese middle class is expected to have an income of between $9,000 and $34,000 by 2022.

 

http://www.mckinsey.com/insights/consumer_and_retail/mapping_chinas_middle_class

[mariner]

And for their economy, that's a good thing.

[sail7seas]

The Chinese middle class is expected to have an income of between $9,000 and $34,000 by 2022.

 

http://www.mckinsey.com/insights/consumer_and_retail/mapping_chinas_middle_class

 

That needs to be put into perspective.

How does that compare to cost of living/average salary in U.S.?

 

[iancal]

You do not have to look very far.

 

Only as far the US 2008 recession or the 2008/9/10 housing crisis.

[BruceMuzz]

That needs to be put into perspective.

How does that compare to cost of living/average salary in U.S.?

 

 

Excellent point.

When I moved to Shanghai in 1999, the average Chinese family there earned a total of US$1,400 per year. The cost of living for that family was US$900 per year.

 

15 years later the cost of living for that Chinese family has risen by only $100 per year, to $1,000.

Government-controlled rents and utilities have not really increased in all those years.

The average annual income for that family is now US$40,000.

 

Shanghai is a best case scenario that you see mainly in the bigger cities in China. But China now has more than 160 cities with over 1 million population.

[POA1]

That needs to be put into perspective.

How does that compare to cost of living/average salary in U.S.?

 

The salary numbers are much lower which means that a typical cruise fare would eat up a much higher proportion of a person's income. Because while the cost of living is undoubtedly lower in China, there's not much that can bring down the operating costs for ships in that market.

[cruiser4801]

Chelly is right on, ten years from now, HAL will not be in existence. Former HAL loyalists like me will be moving to Oceania, Crystal, or Celebrity and NCL is currently offering a better product for suite passengers than HAL. I'm currently booked on an NCL suite in March and think their use of butlers and breakfast and lunch at Cagney's is far superior to HAL's offerings. Notice on the boards how many people are being upsold to Neptune Suites. That means fewer and fewer passengers are paying for the suites. If I ever go on HAL again, I will only travel in non-suites as the suite prices do not reflect the mediocre service currently offered. That is recipe that will not keep HAL in business.

[sammiedawg]

Funny that someone mentioned up sells to Neptune suites, we had several offers for our recent Prinsendsm cruise. Never received them before as we don't book real expensive cabin categories due to the smoking issues on balconies.

I've said this before- I don't think Carnival corporation envisions a big future for Holland America. It seems to be devalued by the parent corporation, accounting for the significant declines we have all noted. The corporation is continually investing in Princess which is trending up in quality as HAL goes down. Brand devaluation is very serious.

[frankc98376]

We have a TA booked in 2015. We saw the Explore 4 promotion and were told that we would have a fare increase of $600 per person to take advantage- not worth it to us. We are cancelling and will start over on our 2015 plans.

 

We always book NS and usually book as soon as the new cruises are published- so end up paying the full fare. Between PG, spa, shops,and shore excursions we always have a very high on board spend (we usually come close or max the Mariner nights for shipboard spend due to length of cruise).

 

I would think that we would be customers that most companies would fight to keep, however based on recent experiences it is pretty clear that they don't seem to care if we stay or go. We used a PCC for the first time this year and she seemed annoyed when we called with questions or requests. A birthday and an anniversary request never made it to the ship. I would think they would have known about the anniversary as we were married on HAL.

We sent the PCC an email from the ship "thanking" her for forgetting and two days later had 3 red balloons that said "bon voyage" on them and another bottle of the cheap sparkling wine (this was 9 days into our cruise).

 

We are watching Celebrity to see how the new suite program plays out. We really aren't terribly interested in NCL- from pictures we've seen we don't care for the interiors of the ships. Haven looks very nice but we need to come out of there at some point.

 

I'm really not holding out a lot of hope for ten years from now. Now that Princess has been brought under the HAL umbrella I wouldn't be surprised to see several more white ships in the future- perhaps with glass outside elevators in the center. This really makes me sad as I remember so well of the Holland America in the late seventies and early eighties. I guess some poor decisions were made in that period that led to the Carnival takeover- still sad remembering what it once was.....

Edited August 24, 2014 by frankc98376

[navybankerteacher]

Excellent point.

When I moved to Shanghai in 1999, the average Chinese family there earned a total of US$1,400 per year. The cost of living for that family was US$900 per year.

 

15 years later the cost of living for that Chinese family has risen by only $100 per year, to $1,000.

Government-controlled rents and utilities have not really increased in all those years.

The average annual income for that family is now US$40,000.

 

Shanghai is a best case scenario that you see mainly in the bigger cities in China. But China now has more than 160 cities with over 1 million population.

 

If these figures are correct, the Chinese enjoy an extraordinary level of disposable income as a percentage of total income - unless taxes consume a very high amount, having the average earning 40 times the cost of living exceeds the US ratios massively ----- where in many instances the "average" US worker (if there is such a thing) rarely earns more than 110% to 120% of his cost of living --- and, considering the mounting level of consumer debt year by year, many barely earn their effective cost of living.

[mcmarya]

My husband occasionally does cruise lecturing for HAL. I expect that the lectures will be a victim of cost cutting measures in the near future.

[sammiedawg]

There have been no on board lecturers the last three cruises on Holland America, big disappointment for us. I don't consider the tour director session to be a lecture.

In contrast, Oceania had two major lecturers on board, one was a Brazilian expert and he did fifteen hour long presentations. The other lecturer was a maritime expert. They also had the usual tour manager give presentations and she used some personal photos.

[Sir PMP]

What are you talking about: "...let the Pinnacles do the 5 ports they can get in to"?

 

Pinnacle monsters can only hit the same few ports because they're too big..

[sail7seas]

Pinnacle ships will not be very much larger than the Signatures. Pinnacles will be 99,000 ton. That is certainly large but not so in comparison to so many other cruise lines. Pinnacles will be of size to transit Panama Canal, dock in St. Thomas, San Juan, Nassau, Barbados, St. Lucia, St. Maarten, Port Everglades, Martinique, Guadaloupe, Curacao, Aruba, Cozumel........ this only listing of Caribbean and off top of my head. She will be able to dock at far more than 5 Caribbean ports and that does not consider the rest of the world.

[rkacruiser]

My husband occasionally does cruise lecturing for HAL. I expect that the lectures will be a victim of cost cutting measures in the near future.

 

For cruises longer than 10 days, I doubt that these usually interesting activities would be dropped from the "On Location" programs. On itineraries that offer off the beaten path ports (as well as other more established ports, i.e. Bergan, Hong Kong, etc.), the insight and information the lectures provide are an important part of the enjoyment of those types of cruises.