HAL Seattle: Fill the ships!

[hammybee]

I have an AMex and shop at Walmart, every week.

 

Given Walmart is one of the very few retailers who remains profitable, I suspect many on this forum, shop there, too.

[kryos]

The flip side is also those who talk about heading to Crystal and the other cruiselines, have you thought about what they are saying about the HAL,RCCL and other midlevel cruisers. Prehaps they are thinking if cruisers come from these lines sail on their ships that they will bring it down!

And those lines have made a smart decision to keep their price levels up, so that if one of those "mid-level" cruisers want to sail their ships, they are gonna have to pay for it.

 

Believe me, the lines that keep their prices up will be the ones that do well in the future. Their ships, their cruise experience, etc., will be associated with high quality in the minds of consumers. Those same cruisers may not be able to afford a Crystal cruise right now, but believe me ... this economy will swing back up again, and when it does ... and everyone is working and making decent money, they may very well give Crystal a try. And, that will be because HAL and other lines like it will be associated with things like mass market, crowds, loud pool music, drunkedness, party hardy folks, etc. That's exactly the market they will have attracted with the lower prices. I'm not saying those people are bad ... they are just looking for something entirely different when they take a cruise ... and HAL will be providing it to them.

 

Unfortunately, it takes a long time to develop a sterling reputation, but only a short while to lose it. HAL will lose the reputation they have in the marketplace for providing a premium cruise experience, and it will take them years to get it back ... if they even decide they want it back. Maybe HAL will decide that delivering the mass market product is cheaper and more profitable. Maybe they will decide to just keep going in that direction ... at least for their larger ships.

 

I still say, if HAL wants to remain known as a premium cruise line ... offering everything a cut above the mass market lines ... then they should keep their price levels to pretty much what they always were ... maybe offer a few "deals" like perhaps free economy airfare on European cruises ... but basically the same prices that they've been charging. They should also keep their standards up as well ... through this poor economy ... and let those who can afford to pay the price, pay it ... and those who right now can't, defer their cruises until later. If HAL can't keep all of their ships filled week in and week out right now, then pull a couple offline. They've got a lot of Signature of Excellence work that needs to be done, so perhaps this would be a great time for some extensive drydock work, don't you think?

 

Just my opinion.

 

Blue skies ...

 

--rita

[KAYEF]

We tried Princess............and were shocked by the small size of the cabins...............the bathrooms...............the showers............and the shampoo, etc. in little cardboard dealies that can't be opened when your hands are wet.............

..........just all those little things we were used to on HAL..........

(I love the cloth hand towels in the public bathrooms, you don't know how nice those are until you cruise another line and there are paper towels all over the floor and counters:()

Two different Princess ships brought two totally different cruises but that doesn't change the sizes of the cabins.

You wouldn't even believe how awful our Norwegian Dream cruise was but, then again, maybe a different ship would have been nicer.

On the Dream "old men" wore baseball hats in the dining room morning, noon and night and even on formal night. It wasn't the young kids, it was these men older than us (60s)...............they never enforced anything regarding dress.

I'm introducing my SIL to cruising this summer; hope that comment regarding Ryndam isn't true on our cruise......I'd be SO disappointed.:cool:

[kryos]

The bottom line is cruise lines make ALL their profit on SHORE EXCURSIONS (The favorite pop quiz question of a friend that used to be a ship's controller) - not on passenger fares (or booze - everyone's first answer to that 'pop quiz'). So, a full ship is always better.

The $60 per day is not a "deposit" ... it's merely a credit card hold. As long as people have the credit limit available on their cards, they will have no problem with that hold, because they will know that they are never going to spend that kind of money, so it will never actually get charged.

 

As for shore excursions ... do you think that if someone is doing the cruise on a shoestring ... only because it was a killer deal and allowed the family to take a vacation this summer ... do you really believe they will get onboard and spend a bundle on shore excursions? Believe me, mom and dad will carefully do their research long before they leave home, and they will find all the best, free beaches that they can on a Caribbean cruise, and that's exactly where they will be spending their time in port. No way will they be taking shore excursions at $50 to $75 (or more) a pop if the family is struggling in this economy.

 

Same goes for other onboard spending. The family will sit down and agree to some points ... "X" number of dollars per day for the casino and not a penny more ... one or two drinks per day, soda cards for the kids that when they run out, the kids drink iced tea or lemonade, etc. The whole cruise will be done on a budget and HAL will not make a bundle ... at least not from that family ... on shore excursions and other onboard spending. After all, if the family had to really do some intense shopping around to even find a cruise they could afford, they're not going to negate those efforts by spending a bundle onboard ... not unless they can afford it, which many of them today cannot.

 

I'd bet that if you asked HAL, and if they were willing to tell ... you would find that onboard spending too is wayyyyyyy down ... at least on the more traditional seven to ten-day "family" type cruises.

 

Yes, it is true, you can lead the family to the boat and get them on with killer deals ... but you can't make them spend once on there.

 

Blue skies ...

 

--rita

[kryos]

We tried Princess............and were shocked by the small size of the cabins...............the bathrooms...............the showers............and the shampoo, etc. in little cardboard dealies that can't be opened when your hands are wet.............

Sounds like Carnival to me. Carnival had a basket in the bathroom filled with "samples" of various products ... you got whatever they threw in there ... I guess whatever the cruise line could get for free that week. You might have shampoo, but then again you might not. You might have two disposable razors instead that week.

 

Princess, on the other hand, had the dispensers in the shower ... one side for shampoo, the other for shower gel. No individual prepackaged items at all. And, yes, I agree ... the cabins were much smaller than on HAL ... at a 200% single supplement too. :(

 

Blue skies ...

 

--rita

[sammiedawg]

If they put ships in mothballs, thousands of employees will be laid off. HAL loyalty to its employees has to be a consideration.

I thought the theory behind filling the ship is related to the fact cruisers spend money while on board. Soft drinks, alcohol, gambling, spa, excursions, etc. Even the tips generate cash for the employees.

We are not big spenders but have never left a ship with less than several hundred dollars in extra charges, sometimes more.

If I were not working I would cruise nonstop this year to see as much of the world as I possibly could while prices are cheap.

[kryos]

I have an AMex and shop at Walmart, every week.

 

Given Walmart is one of the very few retailers who remains profitable, I suspect many on this forum, shop there, too.

Of course we do ... and I'm not even supposed to shop there. Our union asks that we not. But still I have been known to go in there on occasion.

 

But ... and here's the big but ... when I go into Walmart I have a preconceived notion about what I can expect ... mostly self-service, a huge store where I have to look around for what I want ... etc. Of course, when I visit Walmart, I'm not looking for an elegant experience. I'm looking for a good price on what it is I need that day. If I have to serve myself to get it, so be it. Walmart is meeting my expectations very nicely.

 

But when I go on a cruise, I have different expectations. I cruise HAL because those expectations are met. I get an experience that is a cut above what others are getting on some of the other cruise lines, and yes ... I am willing to pay for that. I'll cruise less often in order to be able to do so.

 

So, if you change the HAL experience so that in my mind it becomes no different than an NCL experience, and then the economy improves and HAL tries to raise their fares to what they were before the economy tanked ... what do you think I'm gonna say? "Why bother going back to HAL when I can get the same thing on NCL for a lower price?"

 

That will be because maybe my expectations changed. Maybe I realized that I don't need the HAL experience anymore when the NCL one suits me fine. Or, perhaps I'll be totally turned off of cruising and have found another option for my vacations ... something I've discovered that I like better.

 

Like I said, HAL can lower their prices to rock bottom levels, but they're gonna shoot themselves in the foot by doing so. Wait until the economy turns around and see how hard it will be for HAL to win back that element of the cruising public who once looked to HAL for a premium experience. If you burned them during the poor economy ... because your low price levels forced you to cut out a lot of those extra touches ... specifically the touches that made a certain segment of the population want to sail your cruise line ... those people will likely not be back ... you burned them on their last cruise and that's all they remember ... and the ones who are willing to come back will not be willing to pay higher prices. They'll just go back to NCL or Carnival, or wherever it was from which they came.

 

Blue skies ...

 

--rita

[brucory]

Like I said, HAL can lower their prices to rock bottom levels, but they're gonna shoot themselves in the foot by doing so. Wait until the economy turns around and see how hard it will be for HAL to win back that element of the cruising public who once looked to HAL for a premium experience. If you burned them during the poor economy ... because your low price levels forced you to cut out a lot of those extra touches ... specifically the touches that made a certain segment of the population want to sail your cruise line ... those people will likely not be back ... you burned them on their last cruise and that's all they remember ... and the ones who are willing to come back will not be willing to pay higher prices. They'll just go back to NCL or Carnival, or wherever it was from which they came.

 

Blue skies ...

 

--rita

 

Regardless of what was said by Celebrity's people, ALL cruise lines have been heavily discounting, including the super premium lines. Celebrity was one of the worst offenders a few months back and it caused absolute chaos with their regulars and prepaid cruisers. Perhaps that is why we are seeing this sort of spin now. While some of HAL's regulars expecting a premium product may be dissapointed with cuts, HAL has to make sure it is still around by doing whatever it is they have to do to keep customers coming.

 

And welcome aboard to all those who come from NCL, Carnival, or Walmart for that matter.

 

:D:D:D

[hammybee]

 

Believe me, the lines that keep their prices up will be the ones that do well in the future. -rita

 

I mean no disrespect Rita, but why should I believe this? History says the opposite when you look at notable cruise line insolvencies.

 

Dan Hanrahan, CEO of Celebrity and Azamara Cruises, indicated his discomfort with offering the Celebrity brand in the marketplace below a certain price. He noted that Celebrity won't take business if it'll hurt "pricing integrity" or adversely affect the brand image.

This is slick marketing.

 

Now, let's look at reality:

 

Azamara from $999 Rome to Barcelona taking on NCL.

Celebrity from $429 in Alaska, in June.

Prices are dropping on most of their cruises, just like they are on every other cruise line:

 

Crystal discounting 50%

Oceania discounting up to 72%

Silver Sea discounting 50%

Seaborn discounting up to 55%

Regent discounting 61% and a whopping 70% on the Tahiti run.

 

I can't find a single cruise line that is not doing the deep discount dance for the majority of their cabins. I see "acknowledgement" of cost cutting on almost all cruise line forums.

 

Celebrity has a good product that's neither better or worse than it's peer, HAL. Preferences are subjective and there are good and not so good reviews about both cruise lines.

 

That so many persist in seeking the perfect cruise at the cheapest price is what makes the cruising world go round.

[fatcat04]

Regardless of what was said by Celebrity's people, ALL cruise lines have been heavily discounting, including the super premium lines. Celebrity was one of the worst offenders a few months back and it caused absolute chaos with their regulars and prepaid cruisers. Perhaps that is why we are seeing this sort of spin now. While some of HAL's regulars expecting a premium product may be dissapointed with cuts, HAL has to make sure it is still around by doing whatever it is they have to do to keep customers coming.

 

And welcome aboard to all those who come from NCL, Carnival, or Walmart for that matter.

 

:D:D:D

 

Yes.. the prices we were quoted for Oceania in the Med with free air, some serious discounts. And the most recent Regent sale had some sail prices better than our July HAL prices (with noted differences in cabin class from our booked suite to a balcony but Regent is all inclusive and was offering free excursions so..). Everyone is slashing prices. I am sure some will be devastated to know that these low prices will make even the riff raff think they can cruise... those silly peasants!! Who do they think they are? /sarcasm :p:D Sorry, after some of those posts I've read and being one of THOSE Walmart people, I couldn't resist.

[HALFans]

But when I go on a cruise, I have different expectations. I cruise HAL because those expectations are met. I get an experience that is a cut above what others are getting on some of the other cruise lines, and yes ... I am willing to pay for that. I'll cruise less often in order to be able to do so.

 

So, if you change the HAL experience so that in my mind it becomes no different than an NCL experience, and then the economy improves and HAL tries to raise their fares to what they were before the economy tanked ... what do you think I'm gonna say? "Why bother going back to HAL when I can get the same thing on NCL for a lower price?"

 

Rita, you're singing my song... except I'm going to other lines now to look for my Holland America experience I didn't get on my last HAL cruise this month.

 

My review was just posted today. http://www.cruisecritic.com/memberreviews/memberreview.cfm?EntryID=52910

[foodsvcmgr]

Why the assumption that if HAL steeply discounts fares that they will

adopt mass market actvities like hairy chest contests, beer fests, loud

music, etc.?

Perhaps they would rather maintain the traditional ambiance and show

cruisers new to the line how they are distinguished from Carnival or NCL.

Then when the economy allows fares to rise again, many of those newbies

will stick with HAL because they appreciated the differences!

 

By the way, on OOSTERDAM in December I enjoyed fresh squeezed OJ,

hors d'oeuvres before dinner with my drink, a greatly EXPANDED program

of lecturers and Culinary Arts Center presentations, a pretty decent 10 Oz. sirloin from the always available menu, etc.

Didn't experience any feeling of cutting or downgrading myself.

[pipedreams62]

Why the assumption that if HAL steeply discounts fares that they will

adopt mass market actvities like hairy chest contests, beer fests, loud

music, etc.?

Perhaps they would rather maintain the traditional ambiance and show

cruisers new to the line how they are distinguished from Carnival or NCL.

Then when the economy allows fares to rise again, many of those newbies

will stick with HAL because they appreciated the differences!

 

By the way, on OOSTERDAM in December I enjoyed fresh squeezed OJ,

hors d'oeuvres before dinner with my drink, a greatly EXPANDED program

of lecturers and Culinary Arts Center presentations, a pretty decent 10 Oz. sirloin from the always available menu, etc.

Didn't experience any feeling of cutting or downgrading myself.

 

 

Thanks for any interesting point of view. I agree.

[takemewithyou]

Rita, you're singing my song... except I'm going to other lines now to look for my Holland America experience I didn't get on my last HAL cruise this month.

 

My review was just posted today. http://www.cruisecritic.com/memberreviews/memberreview.cfm?EntryID=52910

 

I've got to say, your final summary sums up my thoughts, as well, on sailing HAL in the near future. We've had 3 sailings in the last year - 5 in all. I am investigating celebrity for a number of reasons.

 

Thank you for your review. :)

[Alexat2]

The $60 per day is not a "deposit" ... it's merely a credit card hold. As long as people have the credit limit available on their cards, they will have no problem with that hold, because they will know that they are never going to spend that kind of money, so it will never actually get charged.

 

Rita,

 

You're missing my point on the hold entirely (as does almost everyone else with an AMEX or a Platinum card with no preset limit or a really high limit) - YOU HAVE TO HAVE THE AMOUNT AVAILABLE for them to put a HOLD on it (whether you end up spending it or not) - and when you get into the LONG cruises - that's a hefty hold. Most people that cruise the really cheap cruises that everyone is worried might start invading HAL don't have an extra $3000+ lying around on their credit limit to have a hold put on it.

 

Lydia

[bepsf]

Some interesting viewpoints here...

 

One of the things that I understood from my last cruise was that onboard spending was waaaaay down in general - so it almost doesn't matter if the ship is full or 50% capacity, when all the profit comes from onboard spending and it isn't there - what's the point in discounting to sail with 1900 passengers or getting better prices to sail with 950 passengers?

 

It might actually be better for the line to sail with fewer passengers paying premium prices: Food costs would be lower, as there are fewer passengers to feed. Staffing costs would be lower as they could send a fair number of stewards, waiters and chefs home for a short vacation. Fuel costs might even be somewhat lower with fewer passengers, crew, luggage and provisions to push around the ocean, less hot water to heat for showers and laundry, fewer rooms to heat and cool, less sewerage to process, fewer meals to cook...

...but the service levels could remain unchanged or improved - and folks paying premium prices still tend to spend more onboard than those who book last-minute rock-bottom rates and come aboard for the bargain-basement all-you-can-eat experience. As bookings increased, the line could easily bring back staff to meet the needs of the fuller bookings, as this would be obvious 2 months in advance of a scheduled departure

 

One other thing doesn't make sense to me: If HAL have to discount heavily right now to fill @ 21000 berths (double occupancy) - Why are they continuing to build Nieuw Amsterdam and following through with plans to add 70 new berths each on 5 existing ships? That's an additional 2500 new berths that they will have to fill in 18 months time. Sure, there might be some penalties to pay to delay or cancel these projects - but in the long run adding nearly 12% capacity to an already overextended business at a time of severe capitol losses and economic uncertainty might be considered, at best, irresponsible to CCL/HAL shareholders and customers - and at worst, insanity.

[midgecruiser]

I believe that cut backs on ships should be expected due to the economy. It's evident in so many areas of life right now. Yes, they are offering some amazing discounts right now on many (not all) itineraries on HAL ships. But, you also have to consider that fewer people can actually afford to vacation and those who can are looking for an excuse to open the purse strings and spend. Even those who can afford to vacation (or spend in general) are not as willing to do so because of the uncertainty of what is to come with this financial crisis. Frankly, that's one of the driving forces...hold on to your money because you don't know how bad it's going to get. Well, heck, how are we going to turn this around if people who CAN spend are not. I am taking a 14 day cruise next month and one of the main reasons is because the rate is amazing. Could I afford it at the non discounted rate? Yes. But, this rate has motivated me to spend right now when all around us we are being told to hold on to our money (media, financial advisors...). I hope that my spending will help others and contribute to turning this economy around. Meanwhile, I will be cruising with people who are also stable in their finances (credit hard to come by) and feel fortunate to have gotten a break in the cruise rate during these "slimmer" times that are effecting everyone.

 

Wendy

[hammybee]

Thanks for any interesting point of view. I agree.

 

Me 2.

[bepsf]

HAL may have learned something in its 140 years of operation.

 

I see this type of comment frequently:

 

A Company does not learn - People do...

...and I guarantee you that not a single person in the offices at 300 Elliott Ave, Seattle or 3655 NW 87th Ave, Miami have been around for 140 years.

[TCF]

For all the cruise lines over the next 18 months to 2 years the name of the game is not profit...it is called survival.

I don't think HAL is under any illusion that they will make a profit out of the next season...they just want to bring in enough money to stabilize their stock price at where it is now..(actually CCL's stock price but you get my point.)...and pay to keep the ships moving from port to port. That outcome will be a huge victory for any of the cruise lines ....they will have survived!!!

While CCL stock value has slipped over the past year it has not crashed, and, it has now stabilized as much as the crazy market will allow any stock to stabilize. This is a good thing. While stock promoters are listing cruise line stocks on the "sell" lists I don't know how many savvy investors are listening to them. These promoters are, after all, part of the gang that got us into this mess in the first place!!

Some of the smaller lines may end up being bought up...and I think people with money in NCL might want to take a hard look at not leaving their money there. The reason I say this is not because NCL is a 'bad' cruise line...or bad cruise experience...but rather because it is owned by investment bankers who just may find themselves in financial trouble for reasons that have nothing to do with NCL and will need to unload their half of the cruise line!

As for what HAL will do....I don't think whether you or I are disappointed...even pissed-off...with what HAL does, or doesn't do, over the next little while even waft through the rarified atmosphere of the executive suite in Seattle. HAL will do what they have to do to keep ships sailing with as many bums in beds as they can...and....will do whatever it takes to make that happen. At the same time they will rachet down costs any way they can....read here....fewer crew...lower service levels. That's just good business....and that is what it will take to survive this economy! And if your think Crystal or any of the other "up-scales" are not looking to do the same thing....you're dreaming!

Just my thoughts.

By the way....thanks Brian for the original post. It does us good to get to give some thoughts to these issues.

[iceman93]

For all the cruise lines over the next 18 months to 2 years the name of the game is not profit...it is called survival.

 

Is HAL (or, I guess really CCL) is in such financial peril that a couple of lean years could put them out of business? I'm not in a position to say, but I certainly hope not. If not, then they should be taking a longer-term view. Rather than SURVIVING the next two years, they could position themselves to THRIVE when the economy turns around.

 

I won't rehash the points made by others, but I strongly feel that an upscale HAL product with impeccable service standards provided to half-full ships will do much more for them over the long run than sacrificing what makes the line special just to fill berths.

 

For simplification, I'll lump people into the Wal-Mart camp or the Saks Fifth Avenue camp. If HAL fills their ships with Wal-Mart folks, the Saks folks will be less likely to sail with them both now and in the future. And then when the economy improves the Wal-Mart folks will still expect bargain-basement pricing, and will probably be happy with what the Saks folks consider a mediocre cruise experience. The Saks folks won't come back, either because they'll have found another line that gladly takes their money and provides what they're looking for or because they still don't want to sail on Wal-Mart-ized ships. So HAL is essentially shedding high-revenue passengers from now on.

 

If that's Stein Kruse's business model, I have to question it. It seems that maybe HAL should be targeting the Nordstrom camp--neither Saks shoppers not Wal-Mart shoppers feel too out of place there. So while they can appeal to a broad demographic, they're also not directly competing with the bunch of true luxury lines or the true mass-market lines. Isn't there a pretty sizable niche there?

[BruceMuzz]

Those who believe that the major cruise lines are in "survival mode" right now are sadly mistaken.

--Our business right now is remarkably similar to what it was right after 9/11. Ships are full.

--The heavy discounting to fill the ships is working very well - just like it did after 9/11.

--The onboard spending patterns (reduced) we are currently seeing are nearly identical to those we saw after 9/11.

 

After 9/11, cruise fares went back up gradually and business went back to normal. There is no reason to believe that the same will not happen again.

 

The Carnival group has already announced publicly that they expect their overall revenues and profits for 2009 to be nearly identical to 2008 - which was very good. But they do caution that the Carnival brands will have to work harder this year to get that revenue and those profits.

 

I don't agree with this concept of discounting to any level to fill the ships. But it worked before, and is working again. Cruise Line CEOs have a habit of using what has worked before, rather than gambling billion dollar companies (and their careers) on new ideas.

 

I have also recommended that cruise lines stop the discounting - even in difficult times. Let the ships run at 80% capacity rather than full. Concentrate on enhanced services to those who can really afford to cruise, rather than "the masses".

 

But there are some problems with that idea.

--First is manning. Keeping service staff onboard costs nearly nothing. The passengers pay most of the labor costs. But with reduced passenger numbers, the tip pool gets smaller and the staff are unhappy. Morale suffers, they give poor service, get fired, or resign. And they don't come back. The cruise lines cannot afford to lose them.

--Crew Travel costs. A huge budget item for a ship. Flying crew halfway around the world to go home is VERY expensive. Your low cruise prices are very dependent on crewmembers flying only once or twice per year. If the cruise line needs to fly several hundred - or several thousand - idle waiters and cabins stewards home from underbooked ships, your cruise is going to cost far more money.

--Recruiting. The cruise industry is dangerously short of qualified service staff. This year the industry fell short by around 75,000 people. Next year will be worse. As tips and salaries have fallen over the past few decades, many cruise ship employees have chosen to stay at home with their families and earn more money there - with far less grief. If a waiter is laid off by a cruise line that is less than full, he will go home and immediately get another job with a different cruise line. He will be very difficult - and expensive - to replace when the economy improves and business picks up.

--Labor Contracts. A cruise line cannot easily "lay off" a crewmember. We all have contracts. The cruise line would be required to pay hefty penalties - and airfare - to send every idle crewmember home.

--Food cost. One of the biggest overall costs to a ship. Today's modern ships are designed and budgeted for 100 plus% occupancy. Falling even a few points below 100% plays havoc with food cost budets. High volume is what it's all about.

[world~citizen]

I see this type of comment frequently:

 

A Company does not learn - People do...

...and I guarantee you that not a single person in the offices at 300 Elliott Ave, Seattle or 3655 NW 87th Ave, Miami have been around for 140 years.

 

But the people in HAL head office are not stupid either. :eek:

 

What separates us from the beasts is cumulative knowledge, well, purportedly. Also, while the honchos in head office may not have been around to read the minutes and proceedings of the first Continental Congress, they were around, as has been pointed out, during the 911 downturn. They are just old enough to remember that. They managed rather well.

 

There is no doubt they are going to have to do some pencil sharpening and belt tightening, but the market never guarantees any company an easy ride all the time. You can't escape to another company to avoid the problem because they are all operating in the same (poor) environment.

I don't think that anyone here realistically expects the cruise experience to be the same. As has been pointed out though, cruise value per dollar spent has been historically increasing. The broad picture is that cruiselines will still offer a product consistent with their relative position to other cruise lines. Crystal will continue to offer more than HAL, and HAL will offer more than NCL and so on. The devil will be, as always, in the details. To the extent they convince pax they offer the best premium experience in this new environment they will succeed relative to Celebrity, Princess etc. The industry will survive overall because it will continue to represent value for the vacation dollar.

 

My own view though is that there are too many cruise berths chasing too few pax. This would have been the case without the downturn, and it doesn't make the problem any easier.

[kryos]

If HAL have to discount heavily right now to fill @ 21000 berths (double occupancy) - Why are they continuing to build Nieuw Amsterdam and following through with plans to add 70 new berths each on 5 existing ships?

Because they realize, and rightly so, that this tight economy is a temporary situation. It will improve and when it does they will probably have no trouble filling all those extra berths. Fail to build the ships and HAL will miss out on a lot of revenue-generating opportunities. Let's face it, it takes several years to bring out a new build. If they don't do it now, there will be a long lag time to get it done once the economy strengthens. In that interim time, lots of people will have gone elsewhere since they couldn't get a HAL cruise and those people very well may not come back.

 

So, I think HAL is smart continuing with their new build program. Give it a year or so and the economy will strengthen and HAL will have no trouble whatsoever filling those ships.

 

Blue skies ...

 

--rita

[kryos]

One of the things that I understood from my last cruise was that onboard spending was waaaaay down in general - so it almost doesn't matter if the ship is full or 50% capacity, when all the profit comes from onboard spending and it isn't there - what's the point in discounting to sail with 1900 passengers or getting better prices to sail with 950 passengers?

Exactly my thoughts. Discounting the cabins down to rock bottom prices is not going to add more onboard spending. If people only book a cruise because they can get it for, say, $700 for the whole three-person family combined, they are not about to come onboard at that whopping cost savings and then eat it up by spending like wild people. They are gonna get on that ship with some very definite ideas as to what they will spend and what they will not spend. They will bring their own wine onboard with them, and enjoy a pre-dinner drink in the cabin instead of in the dining room. They will not dine at the specialty restaurants unless that meal was planned in advance and for a very special purpose. They will not buy costly shore excursions. Rather they will pick up a "cheapie" at the pier or better yet, they will do the "beach thing" instead.

 

If HAL or any other cruise line thinks that slashing prices on cruises will allow them to still make money on onboard spending, then perhaps they need to send their executives back to business school. If people are struggling right now, and normally would bypass a family vacation this year because of money being tight ... you can "lure" them onto the boat with deep cost cutting, but you're not going to entice them to spend with abandon once there. It just ain't gonna happen, because ... after all ... people aren't stupid. They know what they can afford and what they can't ... and generally they will stick within those guidelines.

 

That's why I think HAL should keep their prices at normal levels even if that means sailing ships under capacity. As you say, there will be cost-savings associated with that lower passenger count. Perhaps only needing to put on one show a night, or one dinner seating ... having less staff in other areas, etc. The best thing is that these cost-cutting measures can be implemented without any real effect on the onboard experience of the people who are there. Why would I care if there were 30 less cabin stewards onboard ... if there were less passengers and all the occupied cabins were getting cleaned their normal twice a day?

 

But cut the prices just to get warm bodies onboard, and you're not going to make much more money than you would net by sailing under capacity, and all you're going to accomplish is to lessen the onboard experience so much that most of your HAL loyalists (who are looking for a certain type of experience onboard) will have long gone elsewhere by the time you are ready to put everything back the way it was.

 

Bad idea, in my opinion.

 

Blue skies ...

 

--rita