HAL not being honest with loyal customers

[OlsSalt]

But, after buying back all of the shareholders' equity in the company, and not having any public stock to sell, where does the company get the capital to build new ships?

......

 

What triggered this rambling discussion was a seemingly sympathetic position that favored share holders over passengers as the primary HAL corporate decision driver. The future was being presented - expect more large groups because they offered higher profit margins than regular passengers.

 

You of course raise a good point about buying back shareholder equity. And if the future of HAL demands more large group bookings for shareholder value, the wishes of regular passengers become a lost cause anyway.

 

All I was asking was HAL to notice regular passengers upfront, before cancellation penalties, when a large group will materially impact former expected regular passenger services. In this case the large group that impacted normal dining hours and locations. However, if the group takes over the Hudson Room, that does not move the needle on my radar.

 

How large of a group, or what prior promises made to that group by HAL up front, that creates material disruption to the remaining unsuspecting regular passengers is the lingering issue.

[chengkp75]

What triggered this rambling discussion was a seemingly sympathetic position that favored share holders over passengers as the primary HAL corporate decision driver. The future was being presented - expect more large groups because they offered higher profit margins than regular passengers.

 

You of course raise a good point about buying back shareholder equity. And if the future of HAL demands more large group bookings for shareholder value, the wishes of regular passengers become a lost cause anyway.

 

All I was asking was HAL to notice regular passengers upfront, before cancellation penalties, when a large group will materially impact former expected regular passenger services. In this case the large group that impacted normal dining hours and locations. However, if the group takes over the Hudson Room, that does not move the needle on my radar.

 

How large of a group, or what prior promises made to that group by HAL up front, that create material disruption to the unsuspecting passengers is the lingering issue.

 

I haven't seen a single corporation that places customers ahead of shareholders in decades. That's the business school model. As others have noted, sometimes word of a charter or large group gets out before the contract is signed for the group/charter, so the cruise lines will hold off notifying passengers until the deal is done, whether that is before penalty payment or not, and I don't blame them for not putting out information that may not come to pass.

 

I think there are two issues being mixed here, the business decision to accommodate a large group, and the customer service decision as to how to handle the group. I see the business decision as similar to blocking out a portion of the ship for higher paying cabins (Havens, Sanctuaries, whatever), without having to put up the cost of creating those higher paying cabins (the group pays a premium for existing cabins), so that is a win for the cruise line. As for customer service debates, I don't touch them.

[sail7seas]

Just becaue you and anyone else types it herew, does not make it so........... nO MATGTEWR

[sail7seas]

There most certainly is such a thing as a partial charter. Just, many on this particular board don't understand it because it's not a term HAL uses. Other lines do though.

 

From Cruise Critic:

 

A partial ship charter comes into play when a group wants only some cabins. They do have to meet a minimum: Some cruise lines will only draw up a charter contract for 50 percent or more, while others will consider a 20 or 40 percent ship charter. For example, there is a special interest group of motorcyclists ("Hogs on the High Seas") that books a partial ship charter twice a year. Upfront payment isn't required here -- but payment and cancellation terms are more stringent than for the honeymoon couple or family of four booking just one stateroom, and heavy penalties apply for non-booked space.

 

http://www.cruisecritic.com/articles.cfm?ID=760

 

I m not makinG MY point here It is an unagreed upon fatement. I do not think thre is such a thring as a 'partial ship' charter. No one has proven to me thereis.. No matter how many times, how many poseterws write thei choice of statement for parial ships charter, of 'partial charter ' it does not make it so. You can say it again and agian butt without a link to subsgantiate that as fact, I remain UNCONVINCED AND SUSEPCT i I AM NOT ALONE. sHOW .... SHOW ME Where YOU CAN PROVE THis is a valid term.. i CANNOT REMEMbER EVER SEEING ANYTHING FROM a CRUISE LINE OR CREDIBLE SOURCE OUTLINING 'PARTIAL CHARtERS. LliNK PLEASE? Just because you like the term and your dedinition, it remains questionable without something more definitive. IMO show us........... :)

Edited March 21, 2017 by sail7seas

[bUU]

Maybe HAL should think about going private. Then they could stop worrying so much about "shareholders" and build a cruise ship line that simply keeps the passengers happy, returning, growing and profitable.

There is no reason to believe that the folks who own Holland America now want to bring it private or in any way share your priorities. Since it is therefore expressly your goal, why don't you take Holland America private? I'm not being flippant: The proper way to have a corporation (public or private) operate in the best interest of something other than its owners' financial interests is to have it purchased by those who have that non-financial interest and have them establish the company has an ongoing concern in some interest other than shareholders. The Corporation for Public Broadcasting is a good example of this. You seem to want a Corporation for Public Cruising.

 

They have a very good product and already earn a high degree of customer loyalty.

Since they don't report their internal numbers to the public, as a part of a public corporation, I haven't seen the internal metrics showing that they actually do have a high degree of customer loyalty. Unless you work there and have access to proprietary data, you probably don't either. They could very well have a very low level of customer loyalty, with many customers seeking to continually cruise aboard their ships at a discount (which isn't loyalty).

 

Your exposition of "consumer protection" laws negatively impacting HAL autonomy, sounds a lot like doctors complaining about medical malpractice matters that tie them up which makes "medical care" far more expensive than it need be. I had not thought about the role "consumer protection" laws play in HAL operations.

However, you evidently misread what I wrote, since what I wrote was all in response to your request for details about my earlier comment, and therefore was completely about the role consumer protection laws currently do not play in HAL operations.

 

Why doesn't HAL choose another friendlier legal jurisdiction entity, or does having US cruise ports preclude this.

Don't give them any ideas. I do know that having US cruise ports does incur on the cruise line numerous obligations that they cannot escape. And let's be clear, cruises entirely within the US, and cruises entirely within any one state, will have a completely different situation. But for international cruises that embark and/or debark passengers in the US, there are US obligations incurred. In Holland America's case, issues related to those obligations are addressed by way of, "the United States District Court for the Western District of Washington at Seattle, or as to those lawsuits as to which the federal courts of the United States lack subject matter jurisdiction, in the courts of King County, State of Washington, U.S.A., to the exclusion of the courts of any other country, state, city, municipality, county or locale".

[bUU]

You do realize that you are voicing one of the major reasons the cruise lines are incorporated in foreign countries, and the ship fly foreign flags, right?

Absolutely, and you should know better than the rest of us that that doesn't allow the cruise lines to escape all US and state jurisdiction over their operations.

 

That "state" with the least consumer protection is the flag of convenience country.

No. Consumer protection is irrelevant in these cases. I know you know your stuff aboard ship, but contract law and consumer protection law is another matter. In those context, the law that applies is that which applies in the jurisdiction specified in the contract. (See above.)

 

Very difficult to regulate the business practices of foreign companies.

Don't let them use US banks. Don't let US companies do business with them. Don't allow them to make port at US ports. Loads of ways. Float a cruise line that won't comply with ADA... see how long they are welcome at US ports. (Well, with the change in administration, that may change, I suppose, but it hasn't yet.)

 

So, to extend US consumer protection to the cruise industry, you would have to require the cruise industry to be US corporations and US flag ships.

Sorry, but you're simply mistaken about that, and you yourself said so just a few minutes later:

The cruise lines choose the most convenient and friendly legal venue they can. Most of the cruise lines use the US district court in Florida, because it is close to their corporate offices, and has shown a degree of friendliness to the lines. HAL chooses the courts in Washington state due to closeness to their corporate offices. HAL's ticket contract specifically specifies that arbitration will be pursuant to Federal law, the "Federal Arbitration Act", so debates about state's jurisdiction or level of consumer protection are somewhat moot.

There is clearly some miscommunication going on because in this message you directly contradict what you wrote in your reply to me.

 

Good point about the FAA, however the FAA is limited in scope. Jurisdiction remains in the court it originated (again, in the case of HAL, "the United States District Court for the Western District of Washington at Seattle, or as to those lawsuits as to which the federal courts of the United States lack subject matter jurisdiction, in the courts of King County, State of Washington, U.S.A., to the exclusion of the courts of any other country, state, city, municipality, county or locale"), and the laws applicable to that jurisdiction still apply.

 

I haven't seen a single corporation that places customers ahead of shareholders in decades. That's the business school model.

It is also the law. I alluded to this earlier, but perhaps presented that fact too subtly.

 

A 2010 decision, for example,

eBay Domestic Holdings Inc. v. Newmark

, held that corporate directors are bound by "fiduciary duties and standards" which include "acting to promote the value of the corporation for the benefit of its stockholders."

Edited March 21, 2017 by bUU

[OlsSalt]

I think there are two issues being mixed here, the business decision to accommodate a large group, and the customer service decision as to how to handle the group. I see the business decision as similar to blocking out a portion of the ship for higher paying cabins (Havens, Sanctuaries, whatever), without having to put up the cost of creating those higher paying cabins (the group pays a premium for existing cabins), so that is a win for the cruise line. As for customer service debates, I don't touch them.

 

I see one issue - upfront notice, which makes it a level playing field for all concerned.

 

Then I would know up front my regular fare would need to also include a 7X higher premium evening meal charge, due to the fact if I still wanted to have sit-down dining at 8pm, I would be required to pay the dining surcharges at the Pinnacle, Tamarind or Canaletto.

 

This adds several hundred dollars per person to my original fare price for the chosen privilege of cruising with a large group and maintaining my original cruise passenger expectations.

[RocketMan275]

Maybe HAL should think about going private. Then they could stop worrying so much about "shareholders" and build a cruise ship line that simply keeps the passengers happy, returning, growing and profitable. They have a very good product and already earn a high degree of customer loyalty.

 

You do realize that if HAL were to go private, you would lose the right to attend the corporation's annual meeting, raise your perception of this matter, propose solutions, and vote on these proposals. It's rather doubtful that you would get your way, but the chances of success would be greater there than internet advocacy.

You would also lose your shareholder OBC ($100 per cruise) and $135 annual dividends. Would giving up those shareholder benefits be a fair price to pay to avoid the possibility of this somewhat uncommon inconvenience?

 

[OlsSalt]

You do realize that if HAL were to go private, you would lose the right to attend the corporation's annual meeting, raise your perception of this matter, propose solutions, and vote on these proposals. It's rather doubtful that you would get your way, but the chances of success would be greater there than internet advocacy.

You would also lose your shareholder OBC ($100 per cruise) and $135 annual dividends. Would giving up those shareholder benefits be a fair price to pay to avoid the possibility of this somewhat uncommon inconvenience?

 

Ahhhh ...but we would gain in its place ..... a customer oriented cruise line. Not a cruise line for people not even on the ship.

 

Since I am now asked to enter the large group lottery whenever I sign up now for a cruise designed to in please shareholders instead of me, I will now have to pay several hundreds of dollars in surcharges anyway to get convenient dining ...that I wish.

 

Maybe this loss of OBC and dividends would make up the difference. It would certainly make up for the costs going to to a shareholders meeting, in order to present failing propositions.

[chengkp75]

Absolutely, and you should know better than the rest of us that that doesn't allow the cruise lines to escape all US and state jurisdiction over their operations.

 

No. Consumer protection is irrelevant in these cases. I know you know your stuff aboard ship, but contract law and consumer protection law is another matter. In those context, the law that applies is that which applies in the jurisdiction specified in the contract. (See above.)

 

Don't let them use US banks. Don't let US companies do business with them. Don't allow them to make port at US ports. Loads of ways. Float a cruise line that won't comply with ADA... see how long they are welcome at US ports. (Well, with the change in administration, that may change, I suppose, but it hasn't yet.)

 

Sorry, but you're simply mistaken about that, and you yourself said so just a few minutes later:There is clearly some miscommunication going on because in this message you directly contradict what you wrote in your reply to me.

 

Good point about the FAA, however the FAA is limited in scope. Jurisdiction remains in the court it originated (again, in the case of HAL, "the United States District Court for the Western District of Washington at Seattle, or as to those lawsuits as to which the federal courts of the United States lack subject matter jurisdiction, in the courts of King County, State of Washington, U.S.A., to the exclusion of the courts of any other country, state, city, municipality, county or locale"), and the laws applicable to that jurisdiction still apply.

 

It is also the law. I alluded to this earlier, but perhaps presented that fact too subtly.

 

A 2010 decision, for example,

eBay Domestic Holdings Inc. v. Newmark

, held that corporate directors are bound by "fiduciary duties and standards" which include "acting to promote the value of the corporation for the benefit of its stockholders."

 

While I'm not a legal expert, I do know something about maritime law, and I know that since the cruise lines are not incorporated in the US, that the ticket contracts, under maritime law, are written using the laws of the country of registration of the ship. Therefore, even though HAL specifies a venue for arbitration or legal proceedings, that venue will apply maritime law, not state or federal law.

 

 

As to your ways to force compliance with US laws, just a couple of notes. While the "port state" has jurisdiction while in port and in national waters, the overlap between flag state and port state jurisdiction is typically handled "for the good of international comity" to be that unless the "safety and well-being of the port" is affected, then the port state will not force its jurisdiction on the ship. Things that affect outside the ship, like pollution or emissions, or commerce (taxes, casinos, etc) can be regulated when in territorial waters, but not outside. Gee, not letting them us US banks, they might have to go to offshore banks like Grand Cayman, and get a better deal, real hardship. How do you justify making an "embargo" against doing business with one foreign company (the cruise line) for not complying with a US law, when other foreign companies doing business with US companies do not comply either. Won't stand up to any legal challenge. If you stop a Panamanian or Bahamian flag ship from entering US ports, what is to stop these countries from stopping all of their flag ships from coming to the US (and Panama accounts for a very large share of US commerce). As for the ADA, you do know that even SCOTUS has ruled that not all aspects of the ADA apply to foreign flag cruise ships.

 

 

If it was easy to force foreign flag ships comply with US laws, don't you think that Senator Rockefeller, who has worked at it for decades, would have been able to swing it? Even his "landmark" "cruise passenger bill of rights" was voluntarily adopted by CLIA, since it, as passed, had no jurisdiction.

[RocketMan275]

Ahhhh ...but we would gain in its place ..... a customer oriented cruise line. Not a cruise line for people not even on the ship.

 

Since I am now asked to enter the large group lottery whenever I sign up now for a cruise designed to in please shareholders instead of me, I will now have to pay several hundreds of dollars in surcharges anyway to get convenient dining ...that I wish.

 

Maybe this loss of OBC and dividends would make up the difference. It would certainly make up for the costs going to to a shareholders meeting, in order to present failing propositions.

 

So, you're willing to admit that your proposed solutions are so unreasonable that they would be doomed to failure if the shareholders were to vote on them?

 

What makes you so confident that the owners of a privitized Holland would find more merit in your proposal?

[bUU]

Ahhhh ...but we would gain in its place ..... a customer oriented cruise line.

Effectively, a People's Cruise Line. I'd definitely want to cruise it, but I don't hold out much hope for your efforts to fund it.

 

So, you're willing to admit that your proposed solutions are so unreasonable that they would be doomed to failure if the shareholders were to vote on them?

 

What makes you so confident that the owners of a privitized Holland would find more merit in your proposal?

Good question. I have to say that if I did have the money to help take a cruise line private, once we get there, looking with fear and foreboding at our retirement funds, I'd vote to hire people to run the cruise line so as to maximize its value to me in securing my family's future rather than to placate demands such as those that OlsSalt express.

[bUU]

While I'm not a legal expert, I do know something about maritime law, and I know that since the cruise lines are not incorporated in the US, that the ticket contracts, under maritime law, are written using the laws of the country of registration of the ship.

We're beating a dead horse. Do this: Try to get a court to enforce your interpretation on Holland America regarding a breach of the passengers' cruise contract, given that Holland America has complied with US law and the laws of Washington State. I bet you'll be shocked at how little relevance to reality what you've written has.

[Aquahound]

I m not makinG MY point here It is an unagreed upon fatement. I do not think thre is such a thring as a 'partial ship' charter. No one has proven to me thereis.. No matter how many times, how many poseterws write thei choice of statement for parial ships charter, of 'partial charter ' it does not make it so. You can say it again and agian butt without a link to subsgantiate that as fact, I remain UNCONVINCED AND SUSEPCT i I AM NOT ALONE. sHOW .... SHOW ME Where YOU CAN PROVE THis is a valid term.. i CANNOT REMEMbER EVER SEEING ANYTHING FROM a CRUISE LINE OR CREDIBLE SOURCE OUTLINING 'PARTIAL CHARtERS. LliNK PLEASE? Just because you like the term and your dedinition, it remains questionable without something more definitive. IMO show us........... :)

 

Cruise Critic's definition of a partial charter, along with a link were included in my post that you quoted.

 

But you're more than welcome to just Google search "partial ship charter." Almost any link you click mentions partial charters and explains what they are.

[OlsSalt]

So, you're willing to admit that your proposed solutions are so unreasonable that they would be doomed to failure if the shareholders were to vote on them?

 

What makes you so confident that the owners of a privitized Holland would find more merit in your proposal?

 

I am confident I heard from a lot of posters here if presented with the knowledge they would be cruising with a very large affinity group that would be given priority over their sit-down dining expectations, they would not choose that particular HAL cruise. How many would and how many would not, rests in the bowels of HAL management.

 

HAL must be aware of that fact that some/many would reject that option up front since they continue to be very coy about this point, rather than up front and lay their cards on the table.

 

No question shareholders and the passenger customer base can find themselves at odds on this issue. That is the whole point - the more passengers get treated like second class citizens in order to satisfy non-cruising shareholders holder interests and are now asked to pay surcharges in order to obtain "marketed" inclusive dining expectations, the wider this divide will grow.

 

HAL had to face a similar defection threats when they changed their previous BYO onboard wine policies- but at least that was put explicitly on the table up front. This one is not.

[bUU]

I am confident I heard from a lot of posters here if presented with the knowledge they would be cruising with a very large affinity group that would be given priority over their sit-down dining expectations, they would not choose that particular HAL cruise.

Even to the extent that's true, it is the wrong question: The question that needs to be answered is how many posters, if given the opportunity to gain priority over their sit-down dining expectations by being included in a very large affinity group, would refuse to capitalize on that advantage offered - would give up their preferred dining time, and the opportunity to dine with their group, so as to make room for someone not part of their group? This is no different from the quinceneritas that swarm the Magic Kingdom in January and February: Customers versus customers, with the service provider balancing the expectations of both in such a manner so as to have the very best impact on shareholder value long-term.

[OlsSalt]

Even to the extent that's true, it is the wrong question: The question that needs to be answered is how many posters, if given the opportunity to gain priority over their sit-down dining expectations by being included in a very large affinity group, would refuse to capitalize on that advantage offered - would give up their preferred dining time, and the opportunity to dine with their group, so as to make room for someone not part of their group? This is no different from the quinceneritas that swarm the Magic Kingdom in January and February: Customers versus customers, with the service provider balancing the expectations of both in such a manner so as to have the very best impact on shareholder value long-term.

 

Two sides of the same coin. These are the issues that I am sure keeps HAL management up at night.

 

Get the large group to comp the displaced regular passengers surcharges at the specialty dining venues. Refund them if the full amount is not used by the regular passengers during that cruise. Comp the regular passengers cruise fares and notice upfront for the necessary disruptions caused by the large group.

 

Or callously wave the cruise contract in their faces when regular passengers complain. And boot them off the ship, if this disruption causes hostility between the two passenger groups and staff.

[bUU]

... if this disruption causes hostility between the two passenger groups and staff.

There have been no reports of regular riots between different groups of passengers breaking out from prior changes, and I sure hope that inciting such riots is not what is motivating your comments.

 

And the cruise line executives know that it is much ado about nothing.

Edited March 21, 2017 by bUU

[RocketMan275]

Two sides of the same coin. These are the issues that I am sure keeps HAL management up at night.

 

I am equally sure that HAL management has lost no sleep over this tempest in a teapot.

 

Get the large group to comp the displaced regular passengers surcharges at the specialty dining venues. Refund them if the full amount is not used by the regular passengers during that cruise. Comp the regular passengers cruise fares and notice upfront for the necessary disruptions caused by the large group.

 

That is totally ridiculous. How many seats in specialty dining? How do you plan on seating those who will show up for once they're told specialty dining is being comped by the group? How will you deal with those in the group who also want the specialty dining? After all, they paid (comped) for it.

 

Or callously wave the cruise contract in their faces when regular passengers complain. And boot them off the ship, if this disruption causes hostility between the two passenger groups and staff.

 

The cruise line doesn't need to 'wave the contract', they only need to politely refuse to provide services not required by the contract.

[serendipity1499]

RSVP IS NOT ever a 'partial charter(gootle RSVP charter cruise) There are very large groups qnd there are charters. I don't know for sur there is any such thing as a 'partial charter. I doub it there is. . if a ship is chartered, it can only be booked througfh the echartering agent. you cannot book a cabin on a chartered ship unless you go through the 'group which will populate it for that cruise.

 

When a groupc harters a ship, they are the only guests on it.

 

There most certainly is such a thing as a partial charter. Just, many on this particular board don't understand it because it's not a term HAL uses. Other lines do though.

 

From Cruise Critic:

 

A partial ship charter comes into play when a group wants only some cabins. They do have to meet a minimum: Some cruise lines will only draw up a charter contract for 50 percent or more, while others will consider a 20 or 40 percent ship charter. For example, there is a special interest group of motorcyclists ("Hogs on the High Seas") that books a partial ship charter twice a year. Upfront payment isn't required here -- but payment and cancellation terms are more stringent than for the honeymoon couple or family of four booking just one stateroom, and heavy penalties apply for non-booked space.

 

http://www.cruisecritic.com/articles.cfm?ID=760

 

Aquahound I agree with this & like Sail never thought that Partial Charters existed.. Partial Charters are new to me.. Years ago there was never such a thing as a partial charter, but it looks like many Charter/group Agents have come up with a new gimmick.. I believe it was made up by Group/Charter Agents to sell specific space at rates lower than normal group rates..

 

One such group is **** Group is selling partial charters..

They define partial charters as:

 

Quote

Partialcharters have many of the same benefits of a full charter especially in termsof cost savings. Whether a large conference or trade show or amedium-sized family or anniversary event, xxxxxxxxxx can help you plan andorchestrate your exclusive cruise event. Big or small—we handle it all. Unquote

 

It looks like the people who book them must belong to specific organization & they are more restricted than normal group rates..Years ago we only sold full Charters, Group Rates & special individual Rates..

 

Aquahound what other cruise lines use this terminology.. I've only seen it used by Agents selling the partial charters..

Edited March 26, 2017 by Host Walt

[Aquahound]

Aquahound what other cruise lines use this terminology.. I've only seen it used by Agents selling the partial charters..

 

Hi Serendipity. HAL's parent line, Carnival, uses the term partial charter. This is an excerpt from the CCL cruise contract:

 

"For cancellation charges related to group bookings, partial ship charters or full ship charters refer to your charter contract or group booking agreement for terms and conditions."

[RuthC]

Hi Serendipity. HAL's parent line, Carnival, uses the term partial charter. This is an excerpt from the CCL cruise contract:

 

"For cancellation charges related to group bookings, partial ship charters or full ship charters refer to your charter contract or group booking agreement for terms and conditions."

However, Holland America does not use that terminology. In order for people to understand each other, they need to use the same language. Staying consistent with HAL language, especially when on the HAL forum, is what makes sense.

[2Fltravelers]

We were booked on the 2/14/18 Koningsdam and received a letter from HAL about 2 weeks ago ( I am the agent, too) that the cruise was cancelled. There was no other explanation given. We were offered one of the other sailings and an additional OBC for the trouble. Considering this was my first HAL cruise I was not happy.

 

 

Sent from my iPad using Forums

[RocketMan275]

We were booked on the 2/14/18 Koningsdam and received a letter from HAL about 2 weeks ago ( I am the agent, too) that the cruise was cancelled. There was no other explanation given. We were offered one of the other sailings and an additional OBC for the trouble. Considering this was my first HAL cruise I was not happy.

 

 

Sent from my iPad using Forums

would you mind sharing the amount of the obc?

[RDC1]

However, Holland America does not use that terminology. In order for people to understand each other, they need to use the same language. Staying consistent with HAL language, especially when on the HAL forum, is what makes sense.

 

In place of partial charter Hal uses the term "Incentive Group"