Early Del Rio Legacy vs the Sheehan Legacy

[mking8288]

NCL has made a foray into the varied itinerary market with longer cruises when they had Orient Lines ... Getting back into that field may or may not be profitable for NCL and the other two lines. So far, the other two haven't shown much good success in their revenue area.

 

Meanwhile, just saw an email - about Regents - "new lower fares ..." being advertised. Thus, maybe they will have better success in booking, whether by Q1 or Q2 of 2016, they can continue to "color" their results with better financials when pressed by Wall Street, remained to be seen. Raising the average revenue for NCL and lowering the AI prices for the upscale brands aren't necessary a good thing on the ROI (Return On Investments)

 

It seemed that the moves to Asia to catch up with the wealthy Chinese middle class with disposable income is a rather risky one - several trillions had vaporized in the past 3 months alone with the financial markets tumbling badly, and it's not over yet - for 2017 & beyond, especially when HKG is going to be the closest port & PVG (Shanghai for non-flyers) isn't even mentioned ... not to mentioned that there's no place nearby to dock a cruiseship near Beijing for a 8 hours port stop, not even with HST nearby - to see anything. The norms, culture, impulsive spending habits and vacation patterns of these upscale tourists being courted by designer stores alike are very distinct and different ... no wonder they are still trying to understand and studying their options. As for that tipping and DSC among these travelers loaded with cash ... good luck trying to raise it higher and/or pulling "surprises" unannounced - Google some of their travel news to read for oneself.

 

But, I'm sure that RCI, which has/own 20% interests at the new Kai Tak Cruise Terminal in HKG won't mind the NCL brand berthing there - there's plenty of space for docking, as there's lots of capacity. Whether the other brands will respond with a price war in the Chinese market remained to be seen - perhaps, the CEO's can come to an understanding on the golf course.

 

On a more practical note, we own other travel stocks that paid solid dividends - consistently (actually, just raised it) - and has risen very nice, solid P/E's and outlook ... invest & buy NCLH, thanks but no thanks.

 

As for the fellow who hasn't sail the other brand, he should check them out personally - very nice shrimp cocktails in the MDR, and petite filet mignon steak & eggs for breakfast (with toasted bagel), etc. free & no extra surcharges.

Edited August 6, 2015 by mking8288

[joyy7403]

people do have a right to peacefully protest and that is what they did about the "no food" policy. I agree with you there, but it has become a "what can we bitch about now" generation. When I see things like people griping because the port times were changed, or itineraries are being change 18 months from now and the gripe about no fireworks, I have always beleived in choosing your battles; many here do not seem to see it that way, including you. From what I am seeing it does appear people want it all. This isn't only with cruising, NCL or any other line, it is about life in general. It has truely become a "me" world. And yes, people do have trouble with change. Were you around when Sheehan took over? I have to think most of you were not. As for allowing people to walk all over me, I agree with you; for people who know me, they know how pasionate I can be about what I believe in, but I also have learned there are many things that are just plain nit picing.

 

Could not have said it better myself!!!!

[sfaaa]

He doesn't think CCL is a competitor? What koolaid is he drinking!

 

Yeah, strange assessment indeed. Even though I still have two unused NCL cruise rewards sitting in my drawer, my next three booked cruises are with Carnival and not NCL. Why? Carnival is giving me a bigger bang for my buck.

[boopsahoy]

Could not have said it better myself!!!!

 

 

Who is to say what is important to another person? Someone may think my complaining about a la carte dining is nit picking but for me its a big deal. They raised the DSC again? OK the crew deserves it. So I won't complain about that. BUT no one on this board is the "Decider" of what's important and what's nitpicking, so let people complain. You saw the power of complaining got the no food to the room overturned-and there were many people saying enough posting stop complaining...well there you go.

Edited August 6, 2015 by boopsahoy

[sjbdtz]

Don't think for a second, that these new Asia and Australia cruises will be affordable. Look at RCCL. They get roughly 60-75% higher cruise fares on those sailings compared to any other itinerary they offer.

 

 

You mean affordable for you?

 

FDR has explicitly stated he wants to move away from "affordable" cruising and into higher dollar / higher value cruising.

 

I'm excited by the strategy. Am already looking at something new for late 2016 & 2 more in 2017.

 

 

Stephen

 

.

[eroller]

You mean affordable for you?

 

 

 

FDR has explicitly stated he wants to move away from "affordable" cruising and into higher dollar / higher value cruising.

 

 

 

I'm excited by the strategy. Am already looking at something new for late 2016 & 2 more in 2017.

 

 

 

 

 

Stephen

 

 

 

.

 

 

Excited about paying more and NCL not being "affordable" any longer?

 

If there is something in return I suppose but so far I've seen no NCL product enhancements. Just higher prices and more fees. Great for NCL profits but not so great for the consumer.

[Cruise4Real]

FDR has explicitly stated he wants to move away from "affordable" cruising and into higher dollar / higher value cruising.

 

So you don't see any problems or issues with filling all the cabins on the present ships, not to mention adding 6000 new cabins on mega-ships over the next few years? Just raise the prices and the pax will come a-flockin'?! Even as you change the product to a more a la carte (nickel-and-diming) experience, which sure as heck doesn't sound very "upscale" to me!

 

I already pointed out that NCLH have two upscale brands. Transitioning NCL toward more expensive and upscale experience potentially cannibalizes customers from the upscale lines. Also the plan is apparently to shift the older, smaller, less exciting ships to the more exotic itineraries. I know a lot of people say they prefer to cruise on the "smaller" Jewel-class ships, etc., but my guess is that's in part because they often aren't as expensive as the new mega-ships with all their bells and whistles. Compare prices on Dawn and Breakaway -- you pay a definite premium to cruise to Bermuda on the newer mega-ship compared to the "tired old Dawn." Those older ships are only going to get older and more prone to breakdown or whatever as we go forward. Meanwhile the mega-ships will be shifted to the "milk runs." There are plenty of times during the year when they aren't able to (easily) fill the mega-ships, even on the milk runs. The idea that you're going to use your snazziest and newest and biggest ships for the less expensive itineraries just makes NO sense to me.

 

It's as if the strategy they thunk up several years back when they started building the Epic/BA/GA has been completely tossed aside and a completely new one has been implemented. Maybe if they could cancel the new builds, and try with a new class of more luxurious but smaller ships (and put THEM on the "upscale" itineraries), they might make this work. As it is they're stuck with what looks like to me a mish-mosh of strategies that seem unlikely to work with the tools at their disposal.

 

I really don't see how they're going to square this circle.

[boopsahoy]

 

It's as if the strategy they thunk up several years back when they started building the Epic/BA/GA has been completely tossed aside and a completely new one has been implemented. Maybe if they could cancel the new builds, and try with a new class of more luxurious but smaller ships (and put THEM on the "upscale" itineraries), they might make this work. As it is they're stuck with what looks like to me a mish-mosh of strategies that seem unlikely to work with the tools at their disposal.

 

I really don't see how they're going to square this circle.

 

I agree with how you think. This is so true. I actually like the idea of smaller new luxurious ships for the upscale itineraries.

[motleyfan]

I agree with how you think. This is so true. I actually like the idea of smaller new luxurious ships for the upscale itineraries.

 

Which itineraries are "up scale "????

[Travelcat2]

Really not sure why NCL customers on CC continually bash each other instead of calmly discussing points of view. In any case, I have some news from Seatrade Cruise News from today (see below), and would like to respond to a few comments:

 

eroller: You do not have to sail on a cruise line in order to understand the strategy of the management team (not claiming that I know everything but the changes that have been made so far are bringing about positive financial results.)

 

Hendricks Clan: Just a slight correction.... I did not say that passengers of Oceania and Regent affect NCL's bottom line. Since you mentioned it, the loss of customers from Oceania and Regent would affect the bottom line of NCHL.

 

Swedish weave: Another slight correction. Frank Del Rio did not sell Regent and Oceania ...... PCH (Prestige Cruise Holdings) did.

 

For some factual information, you may want to check out Seatrade Cruise News..... the title of the article is "Higher Ticket and On-board spending lift NCHL Q2". The first couple of sentences are: "Norwegian Cruise Line Holdings chalked up a second quarter profit of $171.6m, or 75 cents per share, 2 cents higher than Wall Street expectations and ahead of the 58 cents a year ago." (Note: A year ago meaning when Sheehan was still there). There is a lot more there to read - check it out.

Edited August 6, 2015 by Travelcat2

[motleyfan]

Really not sure why NCL customers on CC continually bash each other instead of calmly discussing points of view. In any case, I have some news from Seatrade Cruise News from today (see below), and would like to respond to a few comments:

 

eroller: You do not have to sail on a cruise line in order to understand the strategy of the management team (not claiming that I know everything but the changes that have been made so far are bringing about positive financial results.)

 

Hendricks Clan: Just a slight correction.... I did not say that passengers of Oceania and Regent affect NCL's bottom line. Since you mentioned it, the loss of customers from Oceania and Regent would affect the bottom line of NCHL.

 

Swedish weave: Another slight correction. Frank Del Rio did not sell Regent and Oceania ...... PCH (Prestige Cruise Holdings) did.

 

For some factual information, you may want to check out Seatrade Cruise News..... the title of the article is "Higher Ticket and On-board spending lift NCHL Q2". The first couple of sentences are: "Norwegian Cruise Line Holdings chalked up a second quarter profit of $171.6m, or 75 cents per share, 2 cents higher than Wall Street expectations and ahead of the 58 cents a year ago." (Note: A year ago meaning when Sheehan was still there). There is a lot more there to read - check it out.

 

You are absolutely right.

[motleyfan]

I am so excited for my 3rd Norwegian cruise. 1st one was the sky 2nd was the epic and 3rd is gonna be the escape.

[legion3]

You mean affordable for you?

 

FDR has explicitly stated he wants to move away from "affordable" cruising and into higher dollar / higher value cruising.

 

I'm excited by the strategy. Am already looking at something new for late 2016 & 2 more in 2017.

 

 

Stephen

 

.

 

Good luck with that filling the 4 big ships with the elite who can afford it.

 

They will sail elsewhere, present company accepted of course. ;)

 

NCL the mass market line for the 1% Sail like a Country Club Norwegian...

[eroller]

 

eroller: You do not have to sail on a cruise line in order to understand the strategy of the management team (not claiming that I know everything but the changes that have been made so far are bringing about positive financial results.)

 

.

 

 

 

It doesn't take a financial genius to figure out why. When you increase cruise prices, increase the service charge, add new fees like room service, and reduce expenses like fireworks and who knows what else, of course profits are going to be higher. Most of the business already on the books had little choice but to pay these new and higher fees or incur penalties if they canceled.

 

Let's revisit this a year or more down the road when the picture is much clearer if this strategy is working long term. FDR is certainly no genius. Any new CEO can come in and raise prices and add a bunch of new fees and cut costs. Looks great to stockholders in the short term and obviously he is pandering to them. Rarely does it work as a long term strategy. Consumers are not idiots. Something has to be given in return and so far that hasn't happened.

[Hendricks Clan]

Really not sure why NCL customers on CC continually bash each other instead of calmly discussing points of view. In any case, I have some news from Seatrade Cruise News from today (see below), and would like to respond to a few comments:

 

eroller: You do not have to sail on a cruise line in order to understand the strategy of the management team (not claiming that I know everything but the changes that have been made so far are bringing about positive financial results.)

 

Hendricks Clan: Just a slight correction.... I did not say that passengers of Oceania and Regent affect NCL's bottom line. Since you mentioned it, the loss of customers from Oceania and Regent would affect the bottom line of NCHL.

 

Swedish weave: Another slight correction. Frank Del Rio did not sell Regent and Oceania ...... PCH (Prestige Cruise Holdings) did.

 

For some factual information, you may want to check out Seatrade Cruise News..... the title of the article is "Higher Ticket and On-board spending lift NCHL Q2". The first couple of sentences are: "Norwegian Cruise Line Holdings chalked up a second quarter profit of $171.6m, or 75 cents per share, 2 cents higher than Wall Street expectations and ahead of the 58 cents a year ago." (Note: A year ago meaning when Sheehan was still there). There is a lot more there to read - check it out.

 

You suggested in a previous post that Regent and Oceania passengers could affect the bottom line more so than those who are on NCL. That reality is just false. The NCL fleet is much larger, carries vastly more passengers from various price points.

[Hendricks Clan]

You mean affordable for you?

 

FDR has explicitly stated he wants to move away from "affordable" cruising and into higher dollar / higher value cruising.

 

I'm excited by the strategy. Am already looking at something new for late 2016 & 2 more in 2017.

 

 

Stephen

 

.

 

These itineraries that were recently announced are going to be out of the price point for the overwhelming majority of NCL's core demographic when not factoring flight cost alone.

Edited August 6, 2015 by Hendricks Clan

[swedish weave]

Swedish weave: Another slight correction. Frank Del Rio did not sell Regent and Oceania ...... PCH (Prestige Cruise Holdings) did.

 

If your statement is correct, how did Apollo become the owner of the two cruise lines when they formed Prestige ??

 

You are picking at words instead of recognizing the truth about this transaction.

[Hendricks Clan]

Swedish weave: Another slight correction. Frank Del Rio did not sell Regent and Oceania ...... PCH (Prestige Cruise Holdings) did.

 

If your statement is correct, how did Apollo become the owner of the two cruise lines when they formed Prestige ??

 

You are picking at words instead of recognizing the truth about this transaction.

 

Exactly, Travelcat 2 is living in delusion that Oceania wasn't in financial trouble thus needing to be bought by Apollo and when Apollo bought Regent merged the two under PCH. Then not to mention the disaster that Renaissance was while he was part of the executive management team there.

[sjbdtz]

Excited about paying more and NCL not being "affordable" any longer?

 

If there is something in return I suppose but so far I've seen no NCL product enhancements. Just higher prices and more fees. Great for NCL profits but not so great for the consumer.

 

I'm not a budget cruiser, typically (though sometimes I'll sail cheaply & splurge on the land-based part of my trip), and I have tonnes of air miles points.... I want a service I can enjoy, food I can eat, and enough variety to keep both me and my husband occupied.

 

 

So you don't see any problems or issues with filling all the cabins on the present ships, not to mention adding 6000 new cabins on mega-ships over the next few years? Just raise the prices and the pax will come a-flockin'?! Even as you change the product to a more a la carte (nickel-and-diming) experience, which sure as heck doesn't sound very "upscale" to me!

 

I already pointed out that NCLH have two upscale brands. Transitioning NCL toward more expensive and upscale experience potentially cannibalizes customers from the upscale lines. Also the plan is apparently to shift the older, smaller, less exciting ships to the more exotic itineraries. I know a lot of people say they prefer to cruise on the "smaller" Jewel-class ships, etc., but my guess is that's in part because they often aren't as expensive as the new mega-ships with all their bells and whistles. Compare prices on Dawn and Breakaway -- you pay a definite premium to cruise to Bermuda on the newer mega-ship compared to the "tired old Dawn." Those older ships are only going to get older and more prone to breakdown or whatever as we go forward. Meanwhile the mega-ships will be shifted to the "milk runs." There are plenty of times during the year when they aren't able to (easily) fill the mega-ships, even on the milk runs. The idea that you're going to use your snazziest and newest and biggest ships for the less expensive itineraries just makes NO sense to me.

 

It's as if the strategy they thunk up several years back when they started building the Epic/BA/GA has been completely tossed aside and a completely new one has been implemented. Maybe if they could cancel the new builds, and try with a new class of more luxurious but smaller ships (and put THEM on the "upscale" itineraries), they might make this work. As it is they're stuck with what looks like to me a mish-mosh of strategies that seem unlikely to work with the tools at their disposal.

 

I really don't see how they're going to square this circle.

 

I would hate if they put small ships there. Lots of companies have small ships in the region. None have Freestyle ships, which is what attracts.

 

.

[eroller]

I'm not a budget cruiser, typically (though sometimes I'll sail cheaply & splurge on the land-based part of my trip), and I have tonnes of air miles points.... I want a service I can enjoy, food I can eat, and enough variety to keep both me and my husband occupied.

 

 

 

 

I can appreciate that, but personally I consider NCL budget cruising even in the Haven. You're still on a ship with 3000+ others. I mean I can't really think of a cruise line more budget except Carnival but I put them on the same level for the most part. My partner won't even sail on NCL or other budget lines (mass-market) but I still enjoy them because of all the options and amenities. He can't stand all the people and would rather stay home. Now something like Silversea, Azamara, and even Cunard he is there! I enjoy those but not for every cruise because there are limitations. With my partner absolutely because I know he will be happy.

Edited August 7, 2015 by eroller

[hondorner]

I can appreciate that, but personally I consider NCL budget cruising even in the Haven. You're still on a ship with 3000+ others. I mean I can't really think of a cruise line more budget except Carnival but I put them on the same level for the most part. My partner won't even sail on NCL or other budget lines (mass-market) but I still enjoy them because of all the options and amenities. He can't stand all the people and would rather stay home. Now something like Silversea, Azamara, and even Cunard he is there! I enjoy those but not for every cruise because there are limitations. With my partner absolutely because I know he will be happy.

 

I actually agree with you. NCL is definitely "budget". That's why I sail on it when my budget is tight. As for competing with Carnival, it's true both have been " bottom feeders ", but Del Rio is trying to raise it a bit, perhaps to the level of RCCL or Princess, both a bare step above NCL, Carnival, MSC and Costa, the ones at the bottom of the heap.

 

There is no way NCL will ever be in the same class as Oceania, let alone Regent. By getting way from the " milk runs" and into real cruising, even with just a small portion of NCL, he's a step closer to that goal.

 

Of course, they will still have a good chunk of the cruise line on milk runs, it's what the bottom feeders expect. In the mean time, serious cruisers like your partner may reconsider NCL.

[boopsahoy]

I actually agree with you. NCL is definitely "budget". That's why I sail on it when my budget is tight. As for competing with Carnival, it's true both have been " bottom feeders ", but Del Rio is trying to raise it a bit, perhaps to the level of RCCL or Princess, both a bare step above NCL, Carnival, MSC and Costa, the ones at the bottom of the heap.

 

There is no way NCL will ever be in the same class as Oceania, let alone Regent. By getting way from the " milk runs" and into real cruising, even with just a small portion of NCL, he's a step closer to that goal.

 

Of course, they will still have a good chunk of the cruise line on milk runs, it's what the bottom feeders expect. In the mean time, serious cruisers like your partner may reconsider NCL.

 

I consider it budget as well. Thats why I sail it-I couldn't afford a PH suite (not Haven)with the amenities that I can on NCL (with help from the casinos free room that we upgrade).

Edited August 7, 2015 by boopsahoy

[aubreyc1988]

I actually agree with you. NCL is definitely "budget". That's why I sail on it when my budget is tight. As for competing with Carnival, it's true both have been " bottom feeders ", but Del Rio is trying to raise it a bit, perhaps to the level of RCCL or Princess, both a bare step above NCL, Carnival, MSC and Costa, the ones at the bottom of the heap.

 

There is no way NCL will ever be in the same class as Oceania, let alone Regent. By getting way from the " milk runs" and into real cruising, even with just a small portion of NCL, he's a step closer to that goal.

 

Of course, they will still have a good chunk of the cruise line on milk runs, it's what the bottom feeders expect. In the mean time, serious cruisers like your partner may reconsider NCL.

 

I consider NCL budget as well. It's definitely a step above CCL, but no where near RCI. In order to become equal with RCI, they have to start improving their entertainment and onboard amenities.

 

But a cruise is a cruise, I'm just glad to sail :)

[eroller]

I actually agree with you. NCL is definitely "budget". That's why I sail on it when my budget is tight. As for competing with Carnival, it's true both have been " bottom feeders ", but Del Rio is trying to raise it a bit, perhaps to the level of RCCL or Princess, both a bare step above NCL, Carnival, MSC and Costa, the ones at the bottom of the heap.

 

There is no way NCL will ever be in the same class as Oceania, let alone Regent. By getting way from the " milk runs" and into real cruising, even with just a small portion of NCL, he's a step closer to that goal.

 

Of course, they will still have a good chunk of the cruise line on milk runs, it's what the bottom feeders expect. In the mean time, serious cruisers like your partner may reconsider NCL.

 

 

 

I'm all for NCL raising the bar, but it's going to take more than additional fees and higher prices to do so. That is all I've seen so far. Nothing in the way of enhancing the customer experience. How about better quality cuisine, a higher staff ratio, enhanced entertainment, better amenities in the cabins, more attention to detail, etc. etc. More diverse itineraries are a start, but it's going to take more than that. Princess and Royal Caribbean already have more diverse itineraries and IMO offer a better onboard product (I know that is debatable).

 

I agree that NCL will never be a luxury line. I don't think that is the intent and it's not physically possible anyway. They may strive to be a Princess or Royal Caribbean, but again it's going to take some enhancements to the product to do so.

 

I'm actually willing to pay more for an NCL cruise than I do today, but I have to see something in return. I haven't seen that so far. Everything so far doesn't really appear to benefit the customer. Only the stockholders.

[Hendricks Clan]

I'm all for NCL raising the bar, but it's going to take more than additional fees and higher prices to do so. That is all I've seen so far. Nothing in the way of enhancing the customer experience. How about better quality cuisine, a higher staff ratio, enhanced entertainment, better amenities in the cabins, more attention to detail, etc. etc. More diverse itineraries are a start, but it's going to take more than that. Princess and Royal Caribbean already have more diverse itineraries and IMO offer a better onboard product (I know that is debatable).

 

I agree that NCL will never be a luxury line. I don't think that is the intent and it's not physically possible anyway. They may strive to be a Princess or Royal Caribbean, but again it's going to take some enhancements to the product to do so.

 

I'm actually willing to pay more for an NCL cruise than I do today, but I have to see something in return. I haven't seen that so far. Everything so far doesn't really appear to benefit the customer. Only the stockholders.

 

Agreed! Its take, take, take and no give in return.