What is the future of RCCL

[Megsdad]

In my little corner of the hospitality world (Niagara Falls) there has not been a great decline in the numbers of visitors, but they are spending a lot less. Fewer people are taking tours and those who do are cutting back on souvenirs and tips:mad:. I'm down about 10% compared to last summer. Assuming that Richro's numbers are correct, and I have no reason to doubt them, a 35 million dollar loss is only about 1/2 of one percent of their total revenue. It sounds like they are weathering this recession pretty well.

 

Hope the dreaming is ok:)

[MISSYLOU]

RCCL will survive though it might be a rocky road.You will see a bigger seperation of the brands .RCCL will become the entry level family floating Six Flags as per the Oasis.Celebrity will be the Floating Marriot Resort and Azamara will be the Four Seasons.The refined cruiser who enjoys the pampered service will leave Royal a move up the ladder to Celebrity.Each line will offer a different experience for criuisers

:cj

 

 

I agree completely. This didn't just happen overnight either. X pricing has been increasing over the last couple of years. X offers a little more upscale cruise experience than RCI. The older, retired generation won't be interested in cruising RCI as long as there are all the new gizmo's on the ships. RCI will be to Celebrity what Carnival is to Holland and I'll bet the prices will get lower.

[cruise wizard]

RCCL will survive and prosper. They are the most innovative CL and offer the most alternative venues for fun and entertainment. Nothing will compare with the Oasis and Allure - it will be worth the small premium in price to experience cutting edge cruising.

[ILoveRCI!]

I guess this is small change to them! They can easily earn it back. Lets remember how much Oasis is costing to build? As well as Allure? And they are meant to be building a fourth Freedom Class ship aswell!

 

However, I have seen that, on my recent Royal Carribean cruise, that RC have definatly tweaked a few things, to cut back on costs.

[SherriZ366]

RCCL is also pursuing other markets. Lots of capacity in Europe and they are adding capacity to Asia and Australia. They can move ships around to take advantage of changing market conditions. for examaple, they are moving the Serenade and possibly a Celebrity ship out of Alaska for 2010 as that market has been hard to sell.

[COCKYMARK]

By comparison.....does anyone know how the other lines did financially?

[browneyes7]

By comparison.....does anyone know how the other lines did financially?

 

I read an article the other day that said Carnival profits dropped 32% from last year, but they still netted $ 264 million. (I think just in the fourth quarter.) RC reported a 98% drop in the fourth quarter earnings and a $36 million dollar loss.

[centurycruiser]

I guess it is easy to understand why RCCL decided they needed to take steps to reduce costs. Without doing that, the $36 million loss would (could) be much higher.

 

If they can weather the storm, I expect we'll see some things return to normal when the economy returns to normal. I just don't see that happening for at least 4 years. They probably expect it to be longer term than shorter term too. Short term, they probably wouldn't have felt a need to do much. The more stress over a longer term the more change needed.

[yogimax]

Crunch time will come when Oasis and Allure come on line. That will increase capacity by about 8,000 beds. At first, enthusiasm will fill them. But what happens when the enthusiasm wanes and you have to market 8,000 more sailings each week? It will be interesting to watch.

[icannotswim]

RCL should be okay. They will get a tremendous amount of free publicity when Oasis launches. The baby boomers (which includes me) seem to be avid cruisers.

Also, I own stock and I recently received a dividend.

[Captain Jake]

RCCL will survive and prosper. They are the most innovative CL and offer the most alternative venues for fun and entertainment. Nothing will compare with the Oasis and Allure - it will be worth the small premium in price to experience cutting edge cruising.

while I hope the ship is successful there is really nothing innovative on the new ships.You can find the same things bigger and better on many land resorts.While doing these things on a small scale like Royal Caribbean will provide will be important to some I believe most just want to sail and will not want to pay a premium for something that will can be done in a much more exciting manner on land

:cj

[EGG]

I'm not an accountant. Did that 35 million loss include payments they made for the new ships? Maybe someone will explain.

[tcocktail]

while I hope the ship is successful there is really nothing innovative on the new ships.You can find the same things bigger and better on many land resorts.While doing these things on a small scale like Royal Caribbean will provide will be important to some I believe most just want to sail and will not want to pay a premium for something that will can be done in a much more exciting manner on land

:cj

 

I can't imagine what embarkation will be like, especially the first trip. Who wants to be on a ship that big? The food quality is already gone down, RCCL states it's because they have to serve so many people. Can you imagine if they have to tender in anywhere. You as well just stay on board. Bigger is not always better. Then they build a ship like this. If this ship doesn't make it in terms of passengers, could it be a huge loss to the company? I am sure with the economy that they are a bit concerned

[coordinator23]

Once they reposition themselves in the market, RCL will be fine. :) I agree with many of the replies on this thread - RCL will be the line positioned to compete with NCL and Carnival. :( They are sinking (last cruise, this Feb. I was waiting for the "blue light special bulbs" to go on - drink of the day, sales, more agressive than in the past). Celeb. and Princess will compete for that mid level market that RCL used to command. ;)

Because my husband smokes, and wants a cigarette first thing in the morning on the balcony, we are gravititating toward Princess.

WE have 50,000 points (visa) for a free 4 day cruise. Until the changes in the loyalty program, we planned to pay the extra amount and upgrade to a balcony or jr. suite. We probably would have spent $500 on trips, shopping on board, drinks, etc (we average about $100 a day when it's divided out). After that cruise we would have been diamond. Traveling from Chicago, cruising is expensive. We're now applying those points ($500) toward our Feb. cruise. We'll make Diamond then; no need to make it beforehand - the incentive is gone. Ironically, it will probably be our last RCL cruise. (Our Princess cruise last summer was a lot like our earlier RCL cruises - I felt more like "royalty" with them - go figure>)

Rcl will do well with families. Plenty for the kids to do. Parents will pay for Johnny Rockets and family pix. It.:) will find its' market.

[BroncosFan2010]

I think this is an interesting topic since my husband and I just did a RCI cruise followed by a Celebrity cruise 10 days later. Although the Explorer of the Seas was in great shape considering it's age, the service was far from good. We found the nickle and dime charges annoying. We went on the Infinity, also an older ship. The service was so much better, we felt like welcomed guests rather than an annoying releative that you just have to put up with. The extra benefits that we used to get as D members went to the Elite members on Celebrity. They have a brand new Elite member program that out classes the D benefits on RCI.

 

We sail both RCI & Celebrity and up until recently found them almost equal. I know that 35 Million is not a great loss, but when you take away benefits from loyal passengers, add charges for items that were once free, it just doesn't sit very well.

 

I hope that Adam Goldstein will read our comments and take our complaints seriously.

Gem

 

 

Very well put.

[Silvery Seas Cruiser]

I remember when Walt Disney World opened in Florida. So many people were doomsayers claiming that it was too big, too expensive, too crowded. They said it would get old and boring once the excitement wore off. They thought it would fail or at least not be a huge success. How many years ago was that? Forty years?

 

I think Oais and Allure will be like Disney World, going strong for years. Disney World transformed Orlando and Oasis and Allure just might transform cruising, at least for one segment of the market.

[The Big Booper]

I'm not an accountant. Did that 35 million loss include payments they made for the new ships? Maybe someone will explain.

 

Nope. All the construction costs for a new ship are capitalized as an acquisition of an asset. Until the ship goes into service, no revenue or expenses are recognized. This includes construction period interest on the loans made to build the ship.

[Cruise-Nut]

I dont think they will go out of business. They are still very strong. If it ever goes towards that point though - Don't worry because Obama will just send them our tax dollars to help them. No worries!

[tcocktail]

I remember when Walt Disney World opened in Florida. So many people were doomsayers claiming that it was too big, too expensive, too crowded. They said it would get old and boring once the excitement wore off. They thought it would fail or at least not be a huge success. How many years ago was that? Forty years?

 

I think Oais and Allure will be like Disney World, going strong for years. Disney World transformed Orlando and Oasis and Allure just might transform cruising, at least for one segment of the market.

 

You are exactly right RCL is changing cuising.... it's for the worst. What happened to the day of refined cruising that is not cheapened? There is nothing wrong with expanding and certainly change is good, but the era of the cruising of the past is a shame that it is a begone era.

[tcocktail]

I dont think they will go out of business. They are still very strong. If it ever goes towards that point though - Don't worry because Obama will just send them our tax dollars to help them. No worries![/quote

 

LOL!! He is giving it to everyone else. But do you really think he would give it to RCCL?

[rubrrick]

I dont think they will go out of business. They are still very strong. If it ever goes towards that point though - Don't worry because Obama will just send them our tax dollars to help them. No worries![/quote

 

LOL!! He is giving it to everyone else. But do you really think he would give it to RCCL?

 

 

That is an excellent question! Answers?????:);)

 

Rick

[Islandbear]

Of course RCL is having a bad year.

 

Not only did they report a net loss of $35.1 million, but compare that to the same period last year which showed a positive net income of $84.7 million. That is a -$119.8 million turn around. on a company with sales of 1,350.0 million. That is real pain.

 

Revenues are down another 15%, from 2008 which wasn't a great year.

 

Stock Price has dropped 52% in the last year and was down another -7.86% yesterday.

 

As for Oasis & Allure, Of course RCL can't absorb 10,000 more passengers a week. Not because the ships are "big", but because the market is shrinking. Oasis is a huge drain on capital and still hasn't even sold out it's inaugural cruise. Great ships, bad timing.

 

The good news is that the law of supply and demand means that we will all be sailing on the cheap for the next few years until demand increases.

 

The bad news is fewer ports, more days at sea, worse food & service in the MDR, more specialty restaurant charges, fewer diamond benefits, and higher drink prices.

[Captain Jake]

I dont think they will go out of business. They are still very strong. If it ever goes towards that point though - Don't worry because Obama will just send them our tax dollars to help them. No worries!

Since their ships are flagged out of the USA I would hope they would not qualify

:cj

[tcocktail]

Of course RCL is having a bad year.

 

Not only did they report a net loss of $35.1 million, but compare that to the same period last year which showed a positive net income of $84.7 million. That is a -$119.8 million turn around. on a company with sales of 1,350.0 million. That is real pain.

 

Revenues are down another 15%, from 2008 which wasn't a great year.

 

Stock Price has dropped 52% in the last year and was down another -7.86% yesterday.

 

As for Oasis & Allure, Of course RCL can't absorb 10,000 more passengers a week. Not because the ships are "big", but because the market is shrinking. Oasis is a huge drain on capital and still hasn't even sold out it's inaugural cruise. Great ships, bad timing.

 

The good news is that the law of supply and demand means that we will all be sailing on the cheap for the next few years until demand increases.

 

The bad news is fewer ports, more days at sea, worse food & service in the MDR, more specialty restaurant charges, fewer diamond benefits, and higher drink prices.

 

I couldn't agree more, but I am confused on the one statement "we will all be sailing on the cheap for the next few years until demand increases." I thought this would be the case as well. Well maybe in Alaska and the caribbean but certainly NOT in the med. Have you seen the prices there? I was looking at the Brillance for and October the prices arevery siniliar and very very high compared to 2008 and of course this year. In fact if you look closer Celebrity has really raised their prices. I guess repositioning themselves is exactly what is happening. But why would I pay the prices of Celebrity when food has fallen a great deal. For almost the same price if not a few more dollars you can sail on azamara. Do you think prices on board the med cruises will drop as we get closer to the sailing time or do you think that there will be aperiod of time in the fall that RCCL will drop the price to fill up the ship?

[Ocean Boy]

RCL should be okay. They will get a tremendous amount of free publicity when Oasis launches. The baby boomers (which includes me) seem to be avid cruisers.

Also, I own stock and I recently received a dividend.

 

And how did you do get a dividend when RCI suspended payments some time ago? I also own stock and did not receive any dividend.