How Fast Could/Would Cruise Lines React?

[fcorey]

Of course, those "hubs' have to be on a coast...... ie Boston. :)

 

These folks are brilliant business people with loads of experience and success to prove it.

HAL will 'find the answers' necessary IMO

 

 

Sail, I only wish

[hammybee]

I think there is more to an intinerary than the intinerary. By this I mean that some intineraries are more conducive to onboard spending which gives cruise lines more wiggle on cabin prices.

 

That 7 day Mexico sail and the Noordam out of NYC attracted a lot of people who could drive to the port, BYOB and not spend money while onboard. Combine this with deeply discounted cabin prices and it starts to look like sailing becomes a break even proposition for the cruise line, not too different than the situation, with airlines.

 

I wonder if it will be more economical for cruise lines to let some of their aging ships go, than sail at a maybe break even standpoint. It's all about reducing the inventory of ships.

[leoandhugh]

None of the cruise lines, including HAL, can adjust sailings and itineraries nearly as fast as airlines can drop flights and even cities served. The logistics of changing itineraries and ports is tremendous because it takes forever to get new brochures printed and distributed to TAs and to move the cruise ships and the cargo ships that supply them. And in the meantime while they are doing that the airlines may drop other flights and other cities. It is not a rosy picture for the industry as a whole, despite what their PR people may say. And they can reduce their fares only so much before they start running in the red, and then the downward cycle starts in earnest. Just one man's opinion who wishes the outlook were better:(

[kryos]

I think there is more to an intinerary than the intinerary. By this I mean that some intineraries are more conducive to onboard spending which gives cruise lines more wiggle on cabin prices.

I've been told that the best itineraries for onboard spending are the shorter ones presumably because people are more willing to "toss caution to the wind" on a shorter cruise, whereas on a longer one they tend to pace themselves.

 

However, I'll be honest, I don't know how this could be entirely true. My guess, and logic would seem to dictate, that the best cruises for onboard spending are the ones that involve more sea days; i.e., slightly longer itineraries that would have some additional sea days built in.

 

The reason for my hypothesis would be that people are gonna spend their vacation dollars somewhere. If they are in port, they'll spend them there. If they are on the ship, then chances are they'll spend them there.

 

Makes sense, doesn't it?

 

Now I distinctly remember ... on a 30-day Hawaii/South Pacific cruise in January 2006, several people with long faces on disembarkation day ... and with printouts of their onboard spending that went on for miles. :( There were a lot of sea days on that cruise.

 

Blue skies ...

 

--rita

[hammybee]

I've been told that the best itineraries for onboard spending are the shorter ones presumably because people are more willing to "toss caution to the wind" on a shorter cruise, whereas on a longer one they tend to pace themselves. --rita

 

Do you think which ports matters?

 

I think Alaska is a good 7 day cruise because almost everyone books shore excursions and almost all sell out, early on.

 

I suspect this is not the case with the ho-hum Mexico ports as well as some of the Caribbean port calls. It's too easy to hop a cab and hit the beach, just shop the day away or even stay onboard and enjoy the quiet.

 

Conversely, South American intineraries and much of Europe is far more conducive to ship sponsored shore excursions.

[jtl513]

I don't think that CCL would have to "start an airline", but should be able to run some charter flights from hub cities to hub ports like Ft Lauderdale. There should be plenty of spare aircraft around!! :D

[Jemima]

...

I think Alaska is a good 7 day cruise because almost everyone books shore excursions and almost all sell out, early on. ..

.

 

This didn't seem to be so on our Alaskan cruise last month. I talked to more than usual who didn't take excursions or who did them independently. We had no trouble booking shore excursions online even fairly close to sailing. We switched a couple of excursions onboard and again no problem. There wasn't even a line at the shore excursion desk. Never saw a line there. A couple of our excursions were combined with passengers from another cruise ship. A couple of others weren't full including the White Pass. Our railcar was less than half full.

This was a B2B northbound & southbound cruise, so there were a number on cruisetours. Some of the cruisetour passengers just didn't do excursions during the cruise portion of the cruisetour.

[sail7seas]

I don't think that CCL would have to "start an airline", but should be able to run some charter flights from hub cities to hub ports like Ft Lauderdale. There should be plenty of spare aircraft around!! :D

 

 

I agree.

 

I wouldn't be surpised to start seeing some Carnival, Princess and perhaps even HAL charter flights.

 

You're night likely to catch me aboard one of those!!! ;)

[jtl513]

You're night likely to catch ...

Was that supposed to say not likely or right likely or might likely? :confused: And if not, why not? I would think a charter flight from a smaller "business" airfield near a large city could remove an awful lot of the hassles of scheduled flights.

[sail7seas]

Ooops..... me and my numerous typos!! :o

 

I meant to say NO WAY I'd be on a charter. I remember way back when we took a few charter air/hotel packages to the Caribbean. Charters are the last out of the airport; often cancelled or hugely delayed; awful planes......miserably uncomfortable. Wait a minute, that sounds a lot like many of the usual flights we all take all the time these days. :(

 

I haven't really heard of charter flights for some time but I suppose they have those inclusive sort of packages still???

[pipedreams62]

This didn't seem to be so on our Alaskan cruise last month. I talked to more than usual who didn't take excursions or who did them independently. We had no trouble booking shore excursions online even fairly close to sailing. We switched a couple of excursions onboard and again no problem. There wasn't even a line at the shore excursion desk. Never saw a line there. A couple of our excursions were combined with passengers from another cruise ship. A couple of others weren't full including the White Pass. Our railcar was less than half full.

This was a B2B northbound & southbound cruise, so there were a number on cruisetours. Some of the cruisetour passengers just didn't do excursions during the cruise portion of the cruisetour.

 

 

We just got back from 2 weeks on the Veendam.we went whale watching in Juneau and there were only 12 people on the boat. There were 6 cruise ships at the dock that day. Yes 6 ships and they couldn't even fill a whale boat (capt Larry On Orca) it seems the masses head to the tee shirt shops, after tee shirt shop, after tee shirt shop and buy tee shirts and hats made in China. Thousands of people walking around with their red plastic bags from the tee shirt stores. We went out to Mendenhall in the afternoon and were the only two people on the bus. yes we wanted to see Alaska we can buy cheesy tee shirts at home.

[kryos]

I agree.

 

I wouldn't be surpised to start seeing some Carnival, Princess and perhaps even HAL charter flights.

 

You're night likely to catch me aboard one of those!!! ;)

 

Actually, sometimes charters can be a good deal. I have a small airport not far from my house, but it does serve some jet traffic. In fact, when I was flown home from Florida after my skydiving accident, that's the airport they flew me into because it was close to the hospital where I was admitted for my physical therapy.

 

But I always wondered why no normal flights use this airport, because it is certainly capable of handling some traffic. Then I find out ... it does serve jet traffic, but only charters.

 

HAL would likely use a smaller airport if they were running charter flights, as opposed to the big international one. Well, smaller airports are not crowded and luggage handling and security is much easier on everyone concerned.

 

Any flight that could keep me out of Philly International is the flight for me.

 

Blue skies ...

 

--rita

[TCF]

I can see where sails7 is coming from. The charter airlines of the 80's and 90's were terrible to fly with...but what some of us are talking about here are specific charter aircraft operated by CCL for the exclusive use of their various brand passengers.

Just as an example....there is a nifty little airport at Bellingham Wash. about an hour south of Vancouver and an hour north of the communities north of Seattle. CCL has Carnival, Princess, HAL ships leaving from Ft. Lauderdale and Miami. Charter a 737 out of Bellingham for all passengers from BC and northern Washington, (maybe included southern Alberta and western Idaho too.) that are traveling on CCL ships on a given date from both Ft. lauderdale and Miami. Bet CCL could fill it...fly it at cost...and make it a pleasant flight to boot.

Just a thought.

[kryos]

Do you think which ports matters?

Not really. Don't forget ... a lot of cruisers are first-timers even on HAL. They're the ones who tend to overspend onboard anyway ... because they are the ones who haven't learned the importance of keeping close tabs on that onboard bill. They don't realize how easy it is to run it up ... you're not parting with a dime ... it is so easy to just hand that card over for another drink, for a round of Bingo, for dinner in a specialty restaurant, etc.

 

But when an itinerary involves a lot of ports, except for the cruise line shore excursions they are apt to book, HAL is losing revenue to the port. These folks don't know the differerence between a Mexico port, a Caribbean port, or an Alaska port. To them, it's all new and they will probaby spend equally in all of them.

 

It is only once we've done a few sailings and we've been to all of those Caribbean or Mexico ports several times and already bought all of the junk that fell apart before we even got it home, that we become more careful about our spending. That is when we opt, in many cases, to just stay on the ship if a port is a "been there, done that ... many times" sort of one.

 

So, I still plead ignorance here. I just don't understand how the shorter itineraries could be that much more profitable to the cruise line in terms of onboard spending. I would think that it would be the longer ones, or the ones with a lot of sea days (such as the 15-day Hawaii sailings) that would be the HAL cash cows.

 

Blue skies ...

 

--rita

[sail7seas]

You answered your own question, Kryos.

The seven day sailings are the ones that will attract the new cruisers for the most part. They are the one who will do the onboard spending and purchase lots of photos, things from the onboard shops, book many excursions, possibly go a little wild in the casino, drink..... There may be higher sales of soda and wine cards with guests saying Oh Boy, we're on vacation this week and we're going to have a blast. Most people on long cruises are not cruising for the first time and they are more cautious in their spending IMO

 

Also, I think that tips may be better for the crew. Someone may be apt to leave an extra $30 or $40 for the week but not necessarily do it for 4 weeks.

If every week you have a new group of guests, there might be a tendency for the weekly income from tips to be higher.

 

[crazy4cruisn]

I was also wondering if the cruise lines might be forced into setting up their own Charter Airline(s) to move their passengers to ports???

But no matter what happens the next couple of years are going to be very interesting for the travel....but especially the cruise industry.

Renaissance cruise line did exactly that about 10 years ago. The biggest problem was that there were no reserved seats and you had to get in line a good 4 hours+ to get a good seat!

[localady]

My understanding was that a few years ago, the 7 day Oosterdam Mex Riviera run was one of the largest moneymakers for onboard spending in the fleet. If 7 dayers are so popular, it seems crazy to pull a ship doing Saturday to Saturday runs out of San Diego...:rolleyes:

(Okay, yes I am still beating that dead horse, my apologies!;) )

[Namvet4]

http://www.forbes.com/feeds/ap/2008/06/19/ap5135792.html

 

Above is a link to a recent financial observation on CCL . . .

You can read and draw your own conclusions. I am addressing some points I consider important and are responsive to questions and concerns raised in this thread.

Cost of fuel is the big issue affecting the bottom line; but there are other comments/observations that address concerns and questions in this thread.

.

 

“Miami-based Carnival paid $530 per metric ton to feed its fleet, up from $333 per metric ton last year.”

 

The PR statement adds the following:

“Carnival said booking trends are still solid, despite the difficult economic environment.”

 

The booking trends not defined here, or elsewhere, is the breakdown by line, geographic region, ship size and itinerary length. All of these factor in that metric ton price!

 

"It's clear that our guests to some degree are tightening their belt," Carnival Chairman and Chief Executive Micky Arison told analysts on a conference call. "But fortunately they continue to cruise and they continue to book at very acceptable levels."

 

What is “very acceptable levels” will be determined in the next quarterly report! By that time we, the cruising public, will have endured continued escalating fuel costs, airline cancellations and readjustments and probably adjusted cruise itineraries, including cancellations.

 

"We are looking at every possible opportunity to reduce our fuel consumption from an itinerary planning standpoint to conserving energy usage on the ships," said Vice Chairman and Chief Operating Officer Howard Frank.

 

Now CCL as a corporation is responsible for creating its income for employees and stockholders . . . We as individuals depend on discretionary income with limited opportunities to increase our amount.

 

The article is mostly complimentary; by CCLs own statements and those of the analysts, toward the anticipated performance of the company.

How all of that will translate to meeting cruisers needs will answer sail7seas original point - How Fast Could/Would Cruise Lines React?.

( Closing price on the NYSE on Thursday July 3 2008 - 31.89/share.)

 

just my 2 cents ;)