Carnival Triumph incident takes toll on Wave bookings, pricing

By Tom Stieghorst

For the second year running, the cruise industry’s key sales period has coincided with a high-profile mishap at sea.

Agents say early momentum during the Wave season slowed notably after February, when a crippled Carnival Triumph temporarily became the public’s idea of a cruise.

Although big travel agent groups say bookings are up 5% to 16% over 2012, pricing remains slightly behind on cruises booked over the next 12 months, according to one analyst.

“It’s two stories in one quarter,” said Kevin Weisner, vice president at CruiseDeals.com in Charlotte, N.C. “January felt pretty good. Then in March it was a different story altogether.

“We really felt there was a significant impact to our business and call volume in the month of March, which was pretty directly attributable to the incident with Carnival Triumph and the subsequent coverage.”

Weisner said bookings to date are “a little behind” last year, characterizing it as “more than a rounding error but less than ‘worry about it’ size.”

As might be expected, Carnival Cruise Lines is cited as the line with the biggest bookings drop.

In a mid-March conference call, Carnival executives said bookings fell by double digits in the days immediately after the Carnival Triumph engine fire but bounced back after promotions were offered.

Ian Rennardson, an analyst at Jefferies International, estimated in a recent report that prices at Carnival’s flagship brand are down 8% for cruises departing in the next three months.

Rennardson said Norwegian Cruise Line seems to be faring the best of the major brands, likely because of strong pricing for its Breakaway and Getaway ships nearing completion.

Some big agencies say they’re doing pretty well. Joe McClure, president of Montrose Travel near Los Angeles, said cruise bookings are up 16% and sales up 23% year to date.

“We’ve seen soft pricing from the largest mass-market cruise line, but we’ve seen pretty steady pricing from their competitors in the same space,” McClure said.

At CruiseOne/Cruises Inc., general manager Dwain Wall said bookings are up mid-single digits. He said business was strong in 2011 and 2012, “and that is continuing in 2013.”

But could it be even better?

Bill Walsh, president of Cruise Travel Outlet, in Salem, N.H., said that after a record January the phones grew quiet. “We are still up double digits on the year but wonder how much we could have been up,” he said.

Last year’s Wave season provides some easy comparisons. In 2012, the wreck of the Costa Concordia chilled consumers and drove prices into a down cycle that took most of the year to undo.

Hopes were high at the start of 2013 that consumers had turned the page and would book cruises that they might have taken a pass on just after the Concordia’s accident.

While not nearly as consequential as the Concordia, the week-long saga of the disabled Carnival Triumph that started Feb. 10 grabbed an inordinate amount of media attention.

The questions now are how long will Carnival be affected, and how broadly will Triumph’s impact be felt?

Wall said that he expects Carnival to bounce back big, as attention shifts to other news stories. Unlike some, Wall feels that Carnival stayed on top of the crisis.

“I think Carnival did a fantastic job managing that horrible mess they got themselves in,“ he said.

For starters, Carnival met right away with CruiseOne to lay out the facts, develop talking points for agents and an FAQ sheet for passengers who were already booked on Carnival.

“Carnival armed our agents with every possible tool we could think of to make sure they were not sitting there empty-handed,” Wall said.

At the same time, CruiseOne/Cruises Inc. moved up some Carnival marketing that was originally planned for later in the year. Carnival has done some customized newsletters for CruiseOne/Cruises Inc. agents.

“They couldn’t have been more supportive,” Wall said.

Beyond the Triumph fallout, another issue clouding Wave season is the strength of European demand. Wall said he’s having a “phenomenal year” in Europe due in part to better agent training.

Grace Dieleman, of Cruise Holidays of Chatham-Kent in Ontario, also said her European business is strong.

But Europe is soft at Montrose Travel, McClure said. And another Canadian Cruise Holidays agent, Samuel Spencer of Calgary, said that despite some clever promotions from the cruise lines, his numbers remain depressed for big-ship European cruises.

“High summer airfare is once again a deterrent to price-sensitive cruisers,” he said.

In addition, many customers seem to be hanging back and not taking advantage of new value-added promotions such as Celebrity Cruises’ 123Go. When they do book to Europe, Spencer said, it is often too late to get decent airfares, which hurts the travel agent because such a large part of the overall price of the vacation is not eligible for commission.

Many cruise brands owned by public companies are restricted by Securities and Exchange Commission rules on what they can say about pricing and booking during Wave season.

In his April 3 report, Jefferies analyst Rennardson said it appears to have gone better at Royal Caribbean and Norwegian than at Carnival Corp.

For close-in bookings, Rennardson said almost all Carnival Corp. brands are in negative territory, with the Euro-centric P&O, Cunard Line and Costa suffering the most.

Prices for Carnival Corp. cruises sailing within three months are down 8.9%, compared with increases of 7.7% for RCCL and 7.1% for Norwegian Cruise Line Holdings, leading Rennardson to conclude that the latter two are benefiting from Carnival’s troubles.

For cruises sailing four to 12 months from now, the picture is more muddled, with prices at Carnival (down 0.7%) and RCCL (down 3.3%) lower than last year but Norwegian (up 4.7%) in the black.

Rennardson said RCCL is being dragged down by a 23% price decline at its Spanish brand, Pullmantur.

Overall, pricing trends have deteriorated over the past few months, following a period of improvement in waning months of last year.

“Given the easy comparisons of 2012,” Rennardson wrote, “the 2013 ‘Wave booking period’ is more important than ever, with share prices vulnerable to any perceived pricing weakness as cruise pricing in the first few months of the new year is often a good barometer for the rest of the year.”

One bit of good news that doesn’t seem to have made much difference is the stock market’s rise into record territory. New wealth might yet translate into higher cruise bookings and prices, although outside of luxury products, Wall said he doesn’t find much correlation.

Likely of more benefit, said Weisner of CruiseDeals, would be a lasting upturn in home prices.

On that point, Weisner said he’s encouraged. For the first time in a long time, home values have been advancing month after month in a consistent fashion, giving worried homeowners some peace of mind.

“I really do believe, from a personal point of view, that [rising home prices] is going to be a better catalyst for leisure travel sales than the [stock] market,” Weisner said.

Blasts rock finish line at Boston Marathon

UPDATED: Blasts rock finish line at Boston Marathon

By Danny King

Two explosions near the Boston Marathon finish line killed at least three people and injured more than 100 people Monday afternoon.

The blasts took place at about 2:50 p.m. Eastern time about 200 feet apart on downtown Boston’s Boylston Street. Federal authorities have been brought to the city to lead the investigation to determine the cause of the incident.

“It is a criminal investigation that is a potential terrorist investigation,” said FBI Special Agent Richard DesLauriers in a press conference broadcast Monday evening.

Additionally, a fire or explosion took place at Boston’s John F. Kennedy Presidential Library and Museum at about 4:15 p.m., though the Boston Police Department said that incident may have been a fire and may not have been related to the first two explosions. No one was injured in that incident.

Many of the blocks surrounding the blast site will be on lockdown through at least Tuesday as federal, state and local investigators canvas the area for additional information, while law enforcement will be conducting random searches on Massachusetts Bay Transportation Authority subway lines, Massachusetts Gov. Deval Patrick said during the press conference.

Both the 212-room Lenox Hotel and the 148-room Mandarin Oriental Boston, which are about a half-block and one block west of the finish line, respectively, were evacuated and closed by the Boston Police Department until further notice.

Mandarin Oriental spokeswoman Danielle DeVoe said that no injuries occurred at that hotel.

Additionally, the Fairmont Copley Plaza, which is about a block-and-a-half east of the explosions, is only letting guests and hotel employees into the building, the 383-room hotel said on its Facebook page.

The Federal Aviation Administration (FAA) has restricted air space over downtown Boston.

In Washington, Pennsylvania Avenue in the vicinity of the White House was evacuated and closed to pedestrians and vehicles on Monday afternoon as a precaution.

“We will find out who did this. We’ll find out why they did this,” President Barack Obama said in a briefing. “Any responsible individuals, any responsible groups will feel the full weight of justice.”

Ryanair faces call for boycott in Norway

By Ian Taylor

Ryanair has been accused of employing cabin crew on “slave contracts” in Norway.

The accusation by a Norwegian trade union follows a claim by two former cabin crew members who are suing Ryanair over their dismissal.

Norway’s Parat union described the flight attendants’ terms and conditions as “a contract of slavery”. The crew allege there was a “culture of fear” at the carrier.

Ryanair hit back by accusing its former crew members of making “false claims” and the union of trying to distract attention from its role in negotiating job cuts at SAS Scandinavian Airlines.SAS

The former crew members released details of their contracts, causing a public furore in Norway and leading to calls for a boycott of the airline.

Ryanair leased the crews from agencies which employ the staff on Irish contracts despite them being based at Rygge airport outside Oslo.

Norwegian media reported the contracts included the following provisions:

• Employees had to pay for training and uniforms
• Employment could be terminated at any time, with from 0-14 days’ notice.
• Crew were required to pay a €200 fee to resign in the first 15 months of the contract.
• Hourly pay was set at the equivalent of $21 an hour in flight, with no extra pay for weekends or holidays.
• There was no sick pay.
• Crew were entitled to 20 days holiday, booked well in advance but subject to cancellation if Ryanair required staff to work.
• Employees were required to take at least four weeks’ unpaid leave a year.
• Crew were required to be on standby for work without payment and be able to report within an hour.
• Participation in union action was grounds for immediate dismissal.
• Contract terms were to remain confidential, with violation grounds for dismissal.

Ryanair chief executive Michael O’Leary dismissed the claims and described the former flight attendants as “unsuccessful and dismissed”.

He told the Norwegian press: “They just invented these false claims some six months after they were dismissed.” O’Leary argued no one was forced to work for Ryanair.

He said there was a waiting list for jobs and suggested the crew were “supported by labour organisations in the process of agreeing thousands of job cuts and 17% pay cuts in SAS”.

O’Leary added: “We’re an Irish airline operating Irish-regulated aircraft. Our employees are employed under Irish contracts.”

However, following questions in parliament, Norway’s foreign minister Espen Bart Eide was quoted on Friday saying he would not fly on Ryanair until the issues were resolved.

Questioned by MPs, Prime Minister Jens Stoltenberg said: “The government fights social dumping, but it’s extra complicated with the airline industry.”

Caribbean Princess headed to Florida next summer

By Tom Stieghorst

Add Caribbean Princess to the growing number of ships being deployed next year to the Caribbean during the summer months.

Princess Cruises said it will operate the ship from Fort Lauderdale in 2014, the first time in four years Princess has sailed in the Caribbean from May to September.

The 3,600 passenger ship will offer three-, four-, five- and seven-day eastern and western Caribbean itineraries. This summer it is sailing in the Mediterranean.

Other ships sailing the Caribbean from South Florida in the summer next year include Norwegian Getaway, MSC Divina and Carnival Conquest as well as the two Royal Caribbean Oasis-class ships, which also sail from Fort Lauderdale.

Costa to pay $1.3 million fine over Concordia: report

By Tom Stieghorst

Costa Cruises has agreed to a $1.3 million fine levied by the Italian government to settle criminal charges over the sinking of the Costa Concordia, according to a Reuters report from Italy.

The fine applies to the corporation, not to crew members and executives who have been charged and are expected to be prosecuted individually.

The prosecution is satisfied with the ruling by the preliminary court judge, Valeria Montesarchio, and will not appeal, prosecution sources said, adding that the fine was close to the maximum allowed by law.

"This is a balanced decision," Costa Cruises lawyer Marco De Luca said after the ruling. "It is the most reasonable solution."

The company spokesman confirmed De Luca's comments, originally made to Italian media, and said the company had no further statement.

Branson pins profit hopes on Dreamliner

By Robin Searle

Delivery of Boeing’s troubled 787 aircraft will be crucial to Virgin Atlantic’s aim of returning to profitability by 2015, according to the airline’s president Sir Richard Branson.

Speaking to Travel Weekly during the inaugural celebrations for Virgin’s domestic offshoot Little Red in Edinburgh, Branson said he felt the target was viable and dependent on the integration of more cost-effective aircraft.

“As long as the 787s don’t get delayed again, there is every chance that it can be possible,” he said.

Virgin is due to take delivery of Boeing’s 787 Dreamliner in late summer 2014 as part of a wider fleet overhaul. It also hopes to boost revenue with the launch of Little Red services from Heathrow to Edinburgh, Aberdeen and Manchester and through an expected tie-up with Delta Air Lines in the US.

Virgin’s new chief executive Craig Kreeger believes the airline can transform a loss, expected to be about £130 million for the financial year to February 2013, into a profit within two years.

“(To return to profit) our strategy includes trying to find new sources of revenue, and that includes creating connectivity through Little Red and through the relationship with Delta,” said Kreeger.

“We have made some tough decisions, including a pay freeze for staff, but we have to ensure that no decisions are made at the expense of the customer or our people.”

The two airlines filed an application with the US Department of Transportation seeking antitrust immunity for their joint venture this week.

Speaking about the appointment of former American Airlines executive Kreeger, Branson said: “Craig has a lot of experience in the States, and through the Delta deal the States is going to play a bigger and bigger role in Virgin Atlantic’s future.”

Despite discounts, travel not an easy sell for warehouse clubs

By Kate Rice

Warehouse clubs like Costco, Sam’s Club and BJ’s Wholesale Club have come to dominate sales of some consumer products: Costco, for example, is now among the biggest wine retailers in the U.S.

But despite aggressive discounting and, in some cases, rebating, they have failed to grab much market share in retail travel sales.

It turns out that travel is not a natural for warehouse clubs. In fact, Sam’s Club stopped selling travel last year, explaining that it did not enhance “the core club shopping experience.”

Moreover, interviews with individual agents, suppliers and agency marketing groups revealed that traditional travel agents can easily leverage their personal relationships with clients and their deep knowledge of preferred suppliers to beat the Godzilla discounters on value and even on price.

To be sure, the warehouse discounters sell a significant amount of travel — volume, after all, is key to their business model. A Costco executive, for example, said recently that the warehouse discounter would definitely be on Travel Weekly’s Power List should it choose to be included (it chooses not to). Clearly they are huge players.

One tour operator lumps them in with online travel agencies (OTAs), arguing that Costco Travel is, for all intents and purposes, an online agency and online tour operator.

BJ’s Travel is a white-label program operated by World Travel Holdings, which white labels about 25 travel websites for the likes of Best Buy, hotels and many airlines.

The warehouse clubs’ raison d’etre is discounting, and, said an executive with one retail travel group who asked not to be identified, “Every consumer is out there looking for the best price.”

Costco has built a $100 billion empire on that assumption.

According to Stephen Hoch, a marketing professor at the Wharton School of the University of Pennsylvania, warehouse stores compete two ways: by keeping their margins tight and by charging membership fees.

For example, he said, Costco’s margin is about 11%, well below that of more traditional retailers, whose margins might range as high as 25% to 40%, depending on their business model.

The other key to the warehouse giants’ business model is membership fees. The clubs focus on delivering the lowest price in order to attract consumers who pay annual membership fees. In a self-sustaining cycle, the fees, in turn, enable warehouse clubs to afford slim margins.

Proof that the cyclical model works is clearly evident in the warehouse clubs’ bottom lines, Hoch said.

“Costco’s net profit is slightly less than [what it charges in] membership fees,” Hoch said. “That has been the case ever since they were around. Their total profit is dependent on how many people are members.”

Hoch said all three major warehouse clubs have the same model, but Costco has so far executed it most successfully.

Warehouse customers are an attractive demographic because even though they want value, they’re not afraid to spend money. The clubs’ parking lots are filled with BMWs as well as Hondas, some of whose owners are buying diapers while others are buying flat-screen TVs or expensive wines. They willingly pay their membership fees, knowing that whatever they buy, it will be tough, if not impossible, to find it anywhere else at a lower price.

But travel is different from flat-screen TVs, wine and groceries. For one thing, it’s tougher to price shop, because changing just a few variables can significantly alter the price.
On the other hand, any agent, big or small, can tap into group pricing for a cruise, add a few amenities or services and have a unique product. Or they can get unique, value-priced products through a host, consortium or franchise.

Beyond that, said Jeff Sherota, senior vice president of house brands for World Travel Holdings, a flawed vacation isn’t something you can return to the store, the way you can a flat-screen TV.

As a consumer, Sherota, whose brands include CruisesOnly, Cruises.com, CheapCruises.com and several others, said he loves to shop at Costco.

“I drink the Costco Kool-Aid,” he said.

But as travel retailers, he asserted, warehouse clubs are “not a good story,” because they market on price only, thereby commoditizing the products. And for many consumers, he said, travel is too complex a product to sell on price.

It works for some shoppers, who know what they want, do their research and call or go online to book because they know all the answers, Sherota said. But if it’s complicated and involves something as invaluable as a family’s once-a-year vacation, “you want to speak to a professional who can help you make the right decision, as opposed to just giving you the lowest price off the shelf.”

One such professional is home-based agent Lesley Egbert, owner of LiveLongitude in Helena, Mont., and an independent affiliate of Avoya Travel. She said she regularly beats Costco, not by selling travel cheaper than the warehouse discounter, but because consumers come to her for advice.

Egbert said she turns to VAX VacationAccess, Funjet and, in particular, Gogo Worldwide Vacations because she finds its PriceBeat program easy to use.

Besides, Egbert said, she can sometimes even beat Costco’s price simply because she knows her suppliers and what they have to offer. She recalled securing a room upgrade at a Ritz-Carlton in Hawaii for one client who was considering Costco, and saving a high school buddy $1,000 on the honeymoon she and her fiancee almost bought from Costco.

Jim Tedesco, marketing director at Gogo, said Costco is becoming a bigger player in travel, but he sees the personalized service that agents offer as the great differentiator.

Not every travel supplier sells through warehouse clubs. Carnival Cruise Lines, for example, does not sell through Costco, although BJ’s Travel sells Carnival.

Interviews with executives at both Costco and BJ’s Travel suggested that the bulk of their sales are for more mass-market types of vacations.

Costco, for example, sells some very high-end vacations, such as Adventures by Disney and Beautiful Places, a villa rental company that is a preferred supplier for Virtuoso. And it offers high-end products such as Ritz-Carlton, Crystal Cruises, Seabourn and other luxury products. But most high-end products typically are not sold directly from its online platform. Instead, they are offered as pass-throughs. Customers call the suppliers directly on a toll-free number unique to Costco.

A Costco Travel executive who asked not to be identified said that the warehouse giant primarily books vacation packages, cruises and rental cars.

It’s also interesting to note that the company keeps its travel business very low profile. Travel is hardly mentioned in its annual report, and two analysts interviewed for this report who cover Costco were barely aware it even has a travel business.

As for travel products, the Costco executive said, “We’re not going to have something around too long if it’s not selling.”

Jorge Boone, senior vice president of private-label partnerships for World Travel Holdings, said that BJ’s Travel sells everything from a $500 Carnival Cruise to high-end cruises and vacations and even African safaris. But those sorts of sales, he said, are the exception rather than the rule.

In addition to discounts, warehouse clubs offer members incentives for buying travel. Book a cruise starting at $179 with BJ’s and get free onboard spending of up $300 and a gift card valued at up to $200. Costco offers a cash card of up to $2,000 for booking an Adventures by Disney vacation.

As of now, consumers can only use those cash cards to purchase Costco merchandise, but the company said that ultimately, they will be able to use the incentives to purchase travel.

Such rebates and incentives are an anathema to many in the industry, and for that reason, some suppliers choose not to sell through warehouse stores. For example, that was the reason cited by Sandals earlier this year when it described its decision to no longer sell its resort products through Costco.

The warehouse stores, on the other hand, rationalize these sometimes sizeable incentives by pointing out that they are membership clubs and that their members’ fees are buying these sorts of discounts.

Of course, suppliers can choose to walk out on a questionable distribution channel, as Sandals did, or simply let their distributors do business as they choose. The latter is Disney’s philosophy.

“We do not comment on our clients’ business practices,” said a Disney spokesman. “We allow our distribution partners to set their own pricing models.”

Europe's Royal Mediterranean

Mediterranean Deployment

Eight ships are set to sail in Europe next year

By Marilyn Green

Liberty of the Seas will head to the Mediterranean in 2014. // © 2013 Royal Caribbean International

Royal Caribbean International recently announced that Liberty of the Seas, Navigator of the Seas, Serenade of the Seas, and Splendour of the Seas will sail the Mediterranean in 2014, in addition to the Northern Europe deployment of Independence of the Seas, Adventure of the Seas, Brilliance of the Seas and Legend of the Seas. The move means that the cruise line will have a total of eight vessels in Europe next year. Bookings opened for these sailings are currently open.

Most of the 2014 Europe fleet will have undergone Royal’s revitalization program, delivering an expanded array of dining options from the casual dining Park Cafe, Boardwalk Dog House and Rita’s Cantina to the Samba Grill Brazilian steakhouse, the new Viking Crown Lounge with a menu of appetizers in a reconceptualized modern club atmosphere, Izumi Asian Cuisine and the Chef’s Table.

The recently revitalized ships also feature Wi-Fi throughout the vessels, digital signage, flat-panel televisions in newly refreshed staterooms and a poolside, oversized LED movie screen. Independence of the Seas and Liberty of the Seas each have a FlowRider and cantilevered whirlpools, as well as Europe’s only ice-skating rinks at sea, which are also onboard Navigator of the Seas and Adventure of the Seas.

Cruisers six to 36 months old can enjoy the new Royal Babies and Tots Nursery, while three to 11-year olds are led by college-accredited counselors in educational and entertaining programs developed with Fisher Price in the complimentary Adventure Ocean program. Teens have their own dedicated lounge and activities such as learning to mix music in Scratch DJ sessions or the teen-only rock-climbing wall and FlowRider surf simulator sessions.

On Splendour of the Seas, Serenade of the Seas, Legend of the Seas and Brilliance of the Seas, guests can enjoy the new retro-hip R Bar as performers perform the new aerial-acrobatic Centrum Experience performed throughout more than four decks of the ships’ atriums. Guests aboard Liberty of the Seas can take in the Broadway musical Saturday Night Fever by night.

Liberty of the Seas will sail roundtrip from Barcelona on a seven-night, Western Mediterranean itinerary, calling at Provence (Marseilles) and Nice (Villefranche), France; and Florence/Pisa (La Spezia), Rome (Civitavecchia), and Naples/Capri, Italy; the Aug. 10 sailing calls at Cannes instead of Nice. A four-night, roundtrip itinerary departing May 14 will offer vacationers a taste of the Freedom-class experience, with a call at Nice and Florence/Pisa. An eastbound trans-Atlantic sailing on May 1 and westbound on Oct. 26, both 13-night itineraries, will bookend the Europe season.

Navigator of the Seas will homeport in Rome (Civitavecchia) to sail a seven-night Eastern Mediterranean itinerary, which calls at Sicily (Messina), Italy; Athens (Piraeus) and Chania (Souda), Crete, Greece; and Ephesus (Kusadasi), Turkey. The seven-night Eastern Mediterranean cruise, sailing roundtrip from Sicily (Messina). A May 4, 15-night Galveston to Rome cruise or Nov. 9, 14-night Barcelona to Galveston sailing take guests trans-Atlantic. 

Nine to 12-night Italy, Greek Isles and Turkey cruises sail from Barcelona from May through August, and Venice from late August through October. From Barcelona, Serenade of the Seas will alternate 12-night Mediterranean Greek Isles and Mediterranean Venice itineraries, the latter featuring an overnight in Venice. From September, Serenade will homeport in Venice and alternate 10-night Greek Isles and 11-night Greece and Turkey itineraries. A 16-night trans-Atlantic cruise from New Orleans to Barcelona sails on Apr. 26.  Vacationers also can choose a nine-night eastbound sailing from Barcelona to Venice on Aug. 27 and a 10-night westbound return on Oct. 27.

Splendour of the Seas will homeport in Venice for its entire Europe season and alternate seven-night Greek Isles and Greek Isles & Turkey itineraries. The ship will reposition from Sao Paolo, Brazil, to Barcelona for a 14-night trans-Atlantic voyage on Apr. 25, and then start its Europe season with an eight-night Italian Mediterranean and Adriatic itinerary from Barcelona to Venice. Splendour concludes its Europe season with a seven-night Western Mediterranean cruise from Venice to Barcelona on Nov. 15, before returning to Sao Paolo on Nov. 22 on a 15-night westbound trans-Atlantic itinerary.

For close-in bookings, Carnival losing pricing battle

By Tom Stieghorst

In a new report, Jeffries International analyst Ian Rennardson says cruise pricing slipped in March, with the most dramatic decline at Carnival Corp.

For cruises in the next three months, prices are 2.1% lower than at this time last year, with increases at Royal Caribbean Cruises Ltd. (up 7.7%) and Norwegian Cruise Line (up 7.1%) more than offset by a drop at Carnival Corp. (down 8.9%).

The outlook is more positive for cruises booked four to 12 months out, with prices trailing last year by 1.4% in March, compared with 2.1% in February. For cruises booked four to 12 months out, Carnival pricing in March was down 0.7%, RCCL down 3.3% and Norwegian up 4.7%.

The report is based on a Cruise Market Watch database that tracks 190 ships and 9,000 annual cruises.

Rennardson said the March results are disappointing for Carnival.

"We are becoming more concerned that pricing for CCL over the next 12 months remains well below our 0% forecast as we estimate that 30%-50% of the all-important Q3 capacity has been sold at this point," the report said.

"We are now lapping the easy pricing comparisons, and there is less and less time to make up the shortfall — pricing needs to turn sharply positive, and soon, if estimates are to be met."

Norwegian Cruise Line pulls out of CruiseCompete

By Tom Stieghorst

Norwegian Cruise Line has asked CruiseCompete to stop using its proprietary materials and wants its contracted agents to refrain from submitting bids on Norwegian voyages to the Des Moines, Iowa-based company.

In a memo sent to some travel outlets the week of March 18, Norwegian Vice President of Sales Camille Olivere said Norwegian would not sign new contracts with agencies that use CruiseCompete.

Further, under some circumstances Norwegian said it could cancel existing contracts with agents found to be submitting bids on Norwegian cruises to CruiseCompete.

“I very much appreciate your willingness to support our decision as it relates to CrusieCompete,” the memo said.
Olivere could not be reached to elaborate. A Norwegian spokeswoman said she was traveling and unavailable.

Account holders at CruiseCompete can request bids on cruises on a particular itinerary or ship, specifying dates and cabin preferences. The company tells consumers that more than 300 agencies are available to bid on the cruises. Consumers are notified of the bids and can contact the agencies when and if they want.

Olivere’s memo cited several frustrations with the way agents interact with CruiseCompete. In particular, she said, contracted accounts have access to higher commissions than smaller retail accounts, can use group discounts and get marketing funds from Norwegian.

She said a contract partner’s ability to sell its own “packaged product” during periodic timeframes is disrupted by having Norwegian cruises on a “facilitated site” like CruiseCompete. She also said rebating can’t be monitored in such an environment.

In addition, some Norwegian travel partners have bid down commissions or have offered net rates intended for packaging purposes.

“Not only is this activity a breach of the sales and marketing agreement that travel partners like you have signed with Norwegian, it is also negatively impacting the great progress we have made with the Norwegian brand and business,” Olivere’s memo said.

Olivere said Norwegian officials would “avail ourselves of all contractual remedies” up to and including the cancellation of accounts found to have bid on the site.

In a statement, CruiseCompete CEO Bob Levinstein said, “We have reached out to Norwegian Cruise Line to address their concerns. The door is still open, as far as we are concerned, to find a solution."

Levinstein said 55% of cruises booked through CruiseCompete are not with the lowest bidder.

"We are all about providing the consumer with choices and fair competition in the marketplace, as mandated by ethics and the law.”

 

This article has been clarified.
 

Clarification: Norwegian Cruise Line has asked CruiseCompete to stop using its proprietary materials and wants its contracted agents to refrain from bidding Norwegian cruises on the site. A previous version of this report said that Norwegian was asking retailers to stop working with CruiseCompete, but it didn't specify that the action was limited to bidding Norwegian's product, and to agencies with a Norwegian contract.

Correction: The article misspelled the name of CruiseCompete CEO Bob Levinstein.

Duchess of Cambridge to name new cruise liner

The Duchess of Cambridge is to officially name Princess Cruises' 3,600-passenger Royal Princess this summer.
The Duchess, whose baby is due in mid-July, will be at Southampton on June 13 for the naming ceremony of Princess Cruises' 3,600-passenger Royal Princess.
The official ceremony will involve a blessing, the celebratory tradition of smashing a bottle over the hull of the ship and a performance by the Royal Marines Band and the pipers of the Irish Guards.
The Duchess will also go on board for a brief tour of the new liner which will leave on its maiden voyage on June 16.
Princess Cruises' president and chief executive Alan Buckelew said today: "It is a great honour for Princess Cruises that Her Royal Highness the Duchess of Cambridge has accepted our invitation to become the Godmother to Royal Princess.
"We are delighted that the Duchess will launch our new ship and can think of no better way to celebrate our company's British heritage and our commitment to the country."
Features of the new ship include a top-deck, glass-bottomed walkway extending 28ft (8.5m) beyond the edge of the ship, the largest pastry shop at sea and balconies on all outside staterooms.
The Royal Princess will go on Mediterranean cruises this summer followed by Eastern Caribbean cruises beginning in the autumn.

Child in hospital after Disney cruise pool incident

By Phil Davies

A four-year-old boy was airlifted to hospital after being found unresponsive in a swimming pool on a Disney Cruise Lines ship.

The unnamed child was discovered on the Disney Fantasy on Saturday afternoon.

It was the second similar incident in a month for the company which does not have permanent lifeguards at its pools, the Daily Mail reported. Warnings are posted by the side of the water that lifeguards are not on duty.

A 13-year-old from Missouri died after he was found at the bottom of a pool at Disney’s Pop Century Resort, near the Epcot theme park in Orlando on March 10.

Disney Fantasy was briefly docked at Port Canaveral at the time of the incident.

After the boy was discovered Disney staff gave him medical attention. The boy was then airlifted to Arnold Palmer Hospital for Children in Orlando.

A spokesman confirmed: “On Saturday afternoon, our medical personnel responded when a child was unresponsive at one of the pools on the Disney Fantasy.

"The child was quickly transported to the hospital and is receiving medical treatment.  Our focus is on assisting the family, and our thoughts are with them during this difficult time.

"The ship was at Port Canaveral when the incident occurred."

Princess apologizes for employee’s anti-agent email

By Kate Rice

Princess Cruises has disavowed language questioning the value of travel agents that an employee sent to a travel agent’s customer.

In the email, the Princess vacation planner wrote to the customer, “Why book with a travel agent when you can get all of the benefits of booking directly to us, at no cost to you?”
Princess said that the language was not approved and that a new vacation planner had edited language in an email template without seeking approval, which is in violation of the cruise line’s policies. Then the employee shared that language with another new vacation planner.

“The sentiment expressed in the email is not the view of Princess Cruises, and we are disappointed that this was incorporated into a consumer communication from our company,” Princess said in a statement.

The statement added, “Princess Cruises has a longstanding relationship with the professional travel agent community and honors that business partnership with respect and integrity. Travel agents provide the vast majority of business for Princess Cruises.”

Princess said that it has taken disciplinary action with the two employees who used the unapproved language.

Brian O’Connor, Princess’ vice president of sales, apologized for the error in a letter to travel agents and said the cruise line was “extremely embarrassed” by the incident.

He added that Princess does not give its vacation planners access to the cruise line’s database of past passengers.

He also described the processes Princess uses to clear a potential passenger for a vacation planner to contact. Princess does a nightly scrub to make sure no one contacts a potential customer if that customer is currently working with a travel agent, is an agent or has an active booking with a travel agent or directly with the cruise line.

On first ship in five years, Princess Cruises builds on trends

By Tom Stieghorst

MONFALCONE, Italy — The $760 million Royal Princess, nearing completion here, is a pivotal vessel for Princess Cruises that will give it an entrant into the megaship class of vessels now being delivered to the industry.

Five years in the making, the Royal Princess will be 25% larger than the last ship Princess launched, the Ruby Princess in 2008.

Since then, ships like the Norwegian Epic and Allure of the Seas have raised expectations for what passengers can find on the most modern ships in the cruise fleet.

Like those ships, Royal Princess will have space for more features, bigger venues and greater variety in onboard experience.

Some of the features are Princess versions of ideas that have been seen elsewhere.

The “over the edge of the ship” concept, embodied in the Allure’s cantilevered hot tubs, shows up on the Royal Princess as a transparent SeaWalk over the ocean. Its newly expanded buffet area keeps pace with a similarly innovative example on the Solstice-class ships of Celebrity Cruises.

Other features let Princess leap ahead of the pack. These include a huge, dedicated pastry kitchen for the buffet restaurant.

“This is not a gimmick,” said Jonathan Wilson, vice president for hotel operations at Princess. “It’s not just one of a kind to Princess, it’s one of a kind anywhere [at sea],” he said.

Princess executives led an at-sea tour of the partly outfitted ship this week, detailing many of the new features passengers can expect onboard and outlining some of the strategies behind them.

Even from a distance, Royal Princess will have an unusual profile, shaped by the SeaWalk, a promenade that extends 28 feet over the side of the ship and offers a “Fear Factor”-style view through a see-through glass floor to the ocean 16 decks below.

On the tour, Stuart Hawkins, Princess’ vice president of newbuild, said shipbuilder Fincantieri engineered the first-of-a-kind platform with remarkable fidelity to a rendering the cruise line presented.

“We were surprised that they could make it as free-standing as they did,” he said.

The Royal Princess’ top decks feature several other innovations, although none had been completed in time for the tour.

A dancing-waters fountain with nearly 100 fountain jets is the centerpiece of the pool deck. It will be illuminated at night and will be a lounge-chair area during the day. Hawkins said sensors will monitor wind speed and conditions to determine how high the water jets will shoot, so that excess spray doesn’t carry beyond the fountain area.

Looming over the pool area is an enormous steel frame for the Movies Under the Stars outdoor video screen, which at 35 feet by 21 feet will be 30% bigger than the screens on previous Princess ships.
Adjacent to the pool deck will be the buffet dining room, Horizon Court, which will seat nearly 1,500. That is substantially larger than on other Princess vessels, and officials said they think it will solve the chronic crowding that plagues such restaurants.

“Buffets on cruise ships tend to be an Achilles’ heel because of the heavy traffic,” said Rai Caluori, Princess’ executive vice president of fleet operations and head of the newbuild team.

In another innovation, Princess has eliminated beverage stations in Horizon Court and will hire additional wait staff to serve drinks.

Adjacent to Horizon Court will be the 1,200-square-foot pastry kitchen, the Horizon Bistro, which will offer a more casual atmosphere.

“Action stations” in Horizon Court, including hibachi grills, rotisseries and a sandwich bar, cut down on the cafeteria-like queues found in older ships.

“We wanted to avoid a canteen-style, cafeteria-style ambience and make it more of a premium experience,” Wilson said.

In the evening, Horizon Court will transform into one of two alternate dining venues: Crab Shack or Fondues.

A sports well has been created above Horizon Bistro, with a basketball court, batting cages and an indoor laser shooting range. The gym has been doubled in size and moved from Deck 5, adjacent to the spa, to Deck 17 to provide light and ocean views. That also puts it over a public area instead of over cabins, so it can open earlier in the morning, Caluori said.

The expanded spa will have 18 treatment rooms. One eye-popping option will be a pair of Lotus Spa cabana rentals in the adults-only Sanctuary area on Deck 17, which will offer up to four people a daylong session of treatments and pampering for $3,000 per group.

The Sanctuary will have a total of six cabanas, the first time they have been offered on a Princess ship.

The corridors of the Royal Princess will be decorated with cruise photos taken by past passengers. A contest solicited 57,000 photos from which Caluori and his team picked 1,000 of the best submissions to be displayed with a plaque noting the photographer’s name, plus when and where the photo was taken.

“We hope all of the winners will book a cruise to take a photograph of their photograph,” Caluori joked.
Of the 1,780 cabins on the Royal Princess, 81% will have balconies. Nearly half of those will be suites, mini-suites or deluxe cabins with room for a sofa in addition to the balcony.

Three main dining areas

The ship will continue the Princess tradition of having three main dining venues, with lots of nooks and banquettes. “We’ve never wanted to be the cruise line with one massive, open, noisy dining room,” Wilson said.

But the feature room, a Frank Lloyd Wright-inspired restaurant called Concerto, will sport a different look from the other two, and will include an enhanced version of the chef’s table concept.

The circular Chef’s Table Lumiere, private dining area, positioned in the middle of the ship’s traditional dining room, will be encircled by a fiber optic-illuminated curtain.

The 12-seat dining area will feature a table with a 6-foot Murano glass sculpture rising through it. When diners arrive, the floor-to-ceiling curtain will move on an automatic track, closing around them and illuminating vertically at the same time, Caluori said.

There are less showy chef’s tables in the ship’s other two main dining rooms. On previous Princess ships, they were only available on some nights of a cruise, but on the Royal Princess they will be used every night, Caluori said.

The current cover charge for the chef’s table is $90 per person, which includes wine and other features. “We may leave it, we may move it up a bit,” Caluori said of the price. “We haven’t decided.”

Several dining areas have been moved adjacent to complementary bar areas. The steakhouse, called Crown Grill, will be next to the Wheelhouse Bar, a lounge designed to male tastes.
Sabatini’s, an Italian specialty restaurant, will be situated adjacent to Vines, a wine bar that will include what Princess claims will be the largest selection of super-Tuscan wines at sea. They will be displayed in a wine tower decorated with vertical strands of crystal.

There will also be tastings of so-called super-Tuscan wines — a high-powered version of Italy’s friendly Chiantis — with more than 20 choices available.
“Wine is a focus, but it’s not superficial,” Wilson said. “There’s a lot of thought that’s gone into it.”

The midship area where passengers board will be called the Piazza, a three-story space that will be filled with eating, shopping and entertainment options.

A new gelato shop, free fresh pizza and the Bellini Bar, named for a peach-flavored Italian cocktail, will be some of the attractions.

The goal, Caluori said, is to provide enough to keep a passenger in that part of the ship for a whole evening.

If not, the ship features a main theater seating 1,000 and a second lounge/stage area with room for 320.

Princess Live will be another option. Set up like a TV production studio, the 200-seat space will offer live entertainment between 8 a.m. and midnight.

The entertainment will require little or no staging or setup time, so that there will be no more than 15 minutes between shows.

“We don’t want to have people waiting to see something set up,” said Caluori, who noted that the acts might include a quiz show, a guest lecturer, an interview with the captain or a solo entertainer of some sort.

The shows will also be part of the programming for a new, in-cabin TV service that will offer on-demand access to hundreds of movies. Viewers will be able to pause the movie so they can, for example, go to eat and resume watching after dinner, Caluori said.

Princess has been looking for awhile to upgrade its scheduled movie system to make it more appealing. Caluori said focus groups revealed that the average time passengers viewed a scheduled movie on existing ships is 11 minutes.