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Showing posts with label Carnival. Show all posts
Showing posts with label Carnival. Show all posts

Monday, April 6, 2009

Opinion: "Revenge at Sea" - Christopher Elliott Engages in Yellow Journalism on MSNBC; A Misleading Attack on the Cruise Industry

Last week I received a notification of an article by Christopher Elliott entitled "Revenge at Sea" - Five Ways Passengers Are Getting Even With Cruise Lines. Frankly, it shocked me to read this headline at a time that cruise lines are sharply discounting prices in an effort to lure hesitant guests onboard and, thereby provide incredible values. Something about biting the hand or killing the goose that just jumped into my mind.

At the outset I must disclose that Mr. Elliott's website (http://www.elliott.org/) describes itself as "This site is one of the last remaining efforts to bring quality, commercial-free, consumer-focused travel journalism to the Web." But then two lines later he asks for donations, "You can support this site now using a major credit card" ("commercial-free"???) followed by a very short list of "underwriters". Self-promotion and questionable tactics aside, keep the maxim, "Let the buyer beware" in your thoughts.

Now... as I read the article I realized that the perspective is, to start, from a passenger on the Carnival Glory that moaned about the cruise being marketed as "all inclusive" and then he was hit for $30 in specialty dining fees, drink charges, aggressive photographers and a mandatory gratuity. Huh? Who told this man that Carnival was "all inclusive"? There is nothing on Carnival's website or marketing that even hints at that. It is, simply stated, a knowingly false premise...which Mr. Elliott clearly knew and did not correct.

Then he criticize Royal Caribbean for providing its guests with the option...I repeat, option...of purchasing for $14.95 the same upgraded steak they might select in Chops (it's extra cost restaurant at $25 per person). Personally I think that is a great idea...and allows someone to enjoy a better meal for potentially one third the cost (ex. the husband wants the steak, but the wife doesn't and they don't want to dress up). If you think I am making that up, read my review of the Mariner of the Seas (It is actually four parts) where in I complimented Royal Caribbean on the main dining room decor and noted I would have eaten there more often if the food was the quality of what I ate in Chops. Now options are worth someone revenge? But I digress...

Then the author twists his sordid story into how this somehow relates to the Park West Auctions lawsuit for ripping off customers with alleged fakes and overpriced "art"...which the cruise lines obviously get a cut. What does that have to do with anything? Was that ever pitched as part of an "all inclusive" experience. And I have commented about Park West in this blog: Piracy or Ignorance on the High Seas - Art Auctions.
This effects a very small portion of the cruising public...and if they are complaining about $30 for dinner in a specialty restaurant they are not dropping the kind of money that brought Park West under attack.

Mr. Elliott then lays out the actual premise, "But in a series of interviews with passengers and industry experts, a slightly more complex picture starts to surface — that of profit-starved cruise lines pulling out all the stops to attract new customers and of penny-pinching passengers who know they have them over a barrel at last." Didn't I mention at the outset that the cruise lines are courting passengers, not trying to rip them off? UPon what good faith basis Mr. Elliott bury this mid-way in his article and then leave it as though never mentioned?

So these "penny-pinching passengers"...as they have finally been identified...are then given a list of five ways to "get back" at the cruise lines...forgetting that not a single rational reason for this aggressive, negative, emotion has yet been provided. You are going to love them...they really get the cruise lines "over a barrel":

1. Wait until the last minute to book - As I have said, that can really work against you! The least expensive cabins probably will be gone (a horrid thought for THAT kind of penny-pincher) and the better cabins in in any category may be gone. Of course, your ability to pre-plan, get the best airfare, etc. all go out the window as well. Mr. Elliot, you claim on your side, "His focus is’t on the destination, or even the journey, but on the tools you need for a successful trip. No other journalist has his depth of knowledge when it comes to offering practical travel advice, useful strategies and helpful tips." This strategy benefits who exactly and in what way?


2. "Smuggle alcohol onboard" - Wait a minute! You first say the cruise is supposedly "all inclusive" and then you say how to plan around it not being that. And you claim to be the "Travel Troubleshooter" for a major travel magazine. You tell people to break their contract with the cruise line by pouring vodka into a water bottle? While I do not agree with the alcohol prohibition (save the former Carnival passengers who would bring coolers of beer and the like), there is a difference between putting a bottle of whisky in your suitcase and boorish behaviors being encouraged.

3. Don't take the ship's tours. Now I am usually not a fan of ship's tours, but they are very popular for a reason. If you don't want to see Tulum or a specific museum which is cost-prohibitive, so be it. Take a taxi to the beach for $20 rather than a tour for $49 each, absolutely. But to seek revenge by screwing up your vacation by not going on a tour or increasing your stress by making private arrangements? What is it exactly that you are getting your revenge for? What way does that put a cruise line "over a barrel" when it, in reality is only hurting the passenger's vacation?

4. Avoid the upsell. I don't get this at all. If you don't want to eat at the specialty restaurant (the vast majority never have...and they couldn't function as they would be overwhelmed otherwise...ask NCL!) then don't eat there. The author points to a coupon for a free lunch at Johnny Rockets on RCCL, but that has been a marketing item since the venue was established...just like the buy one-get one sales held all over the place. Mr. Elliott, you aren't intentionally misrepresenting the facts because you have a problem with the travel industry are you?

5. Stay at home. Well, there is a non-starter. Don't take a cruise because you want to take out your revenge. Ever heard the saying, "Cut off your nose to spite your face?". You can complain about this charge or that upsell, but the fact is that the VALUE has never been greater. Pay $599 rather than $999 and get hit with $75 in additional costs? That sounds like a bargain for me. (But, I still am wondering what those "additional" costs are. Not one has been mentioned!)

So what we have here is a bogus and irresponsible article trying to create controversy where none, in reality...though may emotionally...exists. Cruises have never been a better value...ever. You can break it down and want this different or that, but the trash that Christopher Elliott pushes in his article are clearly, to me, based upon his desire to get published rather than to assist anyone with a credible article.

More importantly, Mr. Elliot's effort to exploit the naive penny-pincher (as he calls them) into creating non-existent issues can only harm those innocents. The most recent problem posted (which was two months ago) was a person wanting Princess to refund a $200 onboard booking made 4 years ago some other way than by crediting back his credit card account which had been closed. Princess had properly advised the passenger of the process which was complicated by the passenger's action of closing the account rather than the cruise line doing anything wrong. Mr. Elliott intentionally titled his article "Is My Cruise Refund Really Sunk?" when he knew it never was.

In short, Christopher Elliott most certainly appears to be engaging in yellow journalism. At least that is my opinion. I wouldn't trust that man to assist me with a vacation...ever.

MSNBC, you should know better.

Tuesday, March 24, 2009

Carnival Corp Posts 10% Increased 1st Quarter Profits

Folks, I have been saying it for weeks now:  You will never see prices as low as they are now, so book your cruise (even if only as a "wish") before the prices increase.

Today Carnival Corp. (owner of Carnival, Cunard, Holland America, Princess, Costa and Seabourn) posted a ten (10%) percent increase in profits for the 1st quarter over the same period last year.  The reasons are really two-fold:  Significantly lower fuel costs and stronger than expected close-in bookings.

Of course there are still signs of weakness on two fronts:  advanced bookings (even at lower prices) are weaker and some lines are not doing as well as others (so the growth is not necessarily across the board).  So I would caution you that if the lower prices are not driving advanced bookings there may be other strategies which may come into play.  The last thing you want to do is be in the position of losing out because the extras awarded to long range planners are missed.  I do not know this will be the case, but it costs nothing to protect yourself as your deposits are fully refundable.

Thursday, December 4, 2008

Cruise Lines' Fuel Supplements Suspended by Carnival Corp.

With oil prices having plummeted to $46 a barrel, Carnival Corp. has suspended (not eliminated) its fuel supplement for all of its major brands: Seabourn, Cunard, Holland America, Princess, Costa and Carnival.

This is how it will work:  A refund of the fuel supplement will be made in the form of a shipboard credit for all bookings within the final payment period for departures on or after December 17, 2008. All bookings outside of the final payment period for departures on or after December 17, 2008 will be adjusted to remove the fuel supplement and guests will be provided with a revised final payment amount.

I am confident the other cruise lines will follow suit shortly. 

Now, if only for the airlines!

Saturday, November 1, 2008

Carnival Corp.'s Response to Anticipated Cash Flow Reductions: Shareholders, Not Passengers, To Feel the Pinch

Carnival Corp. (owner of Carnival, Princess, Costa, Holland America, Cunard and Seabourn) announced yesterday that it was suspending the distribution of dividends for 2009; not because of a lack of profitability - Carnival's products are, and are projected to remain, profitable - but because of a change in cash flow and cruising habits on most of its brands.

Even though Carnival reports it is sitting with over $1.3 Billion dollars in cash, it is anticipating that (as occurred immediately post 9/11) (1) people are not as easily committing to cruises 6-9 months or longer in advance, so the immediate cash flow from the deposit payments is reduced; and, (2) people are not willing to travel as far to get to their cruise vacation (and the increases in air fares and reduction in airline service doesn't help). 

What this also means is that people are going to be booking more of the less profitable Caribbean cruises than the higher profit European cruises on most of the Carnival brands.  Ships are being repositioned as we speak; with, for example, Baltimore announcing it will be a home port for Carnival, Royal Caribbean and Celebrity on an extended (almost year round) basis.  [Note:  Seabourn is not taking these steps.  It has, in fact, announced its expansion into Asia and its commitment to finding additional unique European ports.  More to come on this.]

One other thing to consider, there will not be many new ships added to order books.  So what is seen as a lack of shipyard capacity today, may result in an overcapacity situation in a few years.  To me this is a classic example of how the economy is grown from the bottom up.  If the consumers aren't spending money...or even just aren't spending it as fast...the businesses contract, the investors get less in the short term and industry retracts. 

With Exxon Mobil announcing $13.8 Billion dollars in profits in the 3rd Quarter, one wonders what the effect of shorter cruising itineraries (driving first by the outrageous oil prices and now by reduced/changed itinerary demands) will have on the 4th Quarter 2008/1st Quarter 2009 profits.  We have all seen the drastic effect a 5% drop in U.S. driving has done on the price of a gallon of gasoline, so the cruise lines' changes will most definitely have some affect.  I think those investors - who have been extremely happy over the past few years - may see a bit less in the way of dividends and stock value increases.

While I am not thrilled with the concept of Carnival suspending dividends to its shareholders for 2009, in the long term (as Mickey Arinson asserts) this bit of fiscal conservatism (rather than gimmicks) is designed to assure Carnival will remain fiscally strong in the long term.  (Now reflect on some of the short term gimmicks I wrote about earlier in the week and you can better understand why I see some of them as Red Flags.)

Friday, October 10, 2008

Carnival Brands Drop Fuel Surcharge For New 2010 Bookings- UPDATED

In a move that I felt was long in coming...as I felt was the drop in oil prices...Carnival Corp. has announced today that effective October 31, 2008 it will eliminate the fuel supplement charge on all new 2010 bookings on any of its lines (Seabourn, Cunard, Holland America, Princess, Carnival and Costa) and will, instead, institute a modest price increase. 

If you have booked a cruise with a fuel supplement you may be entitled to an onboard credit dependent on the future price of fuel.  Essentially, for any 2008, 2009 or 2010 cruise where a fuel supplement has been charged, if the price of light sweet crude oil on NYMEX (a primary oil trading exchange) remains below US$70 per barrel for 25 consecutive days ending 5 days before your cruise departs you will receive an onboard credit equal to the fuel supplement already charged.  But if the price fluctuates above US$70 a barrel for even one day during the period, the fuel supplement remains.  Put another way, starting 30 days before your cruise if the price stays below US$70 until at least 5 days before you cruise, you get your money back.

Considering that (a) most people just want to know the price of their cruise and do not care about the breakdown of the cost, and that tacking on a charge that has normally been included in the cruise price seems a bit offensive (even thought it was necessary), and (b) the cruise lines do not want to be seen as profiting from the unanticipated fall of artificially inflated oil prices, this reversion to the "old ways" makes a lot of sense.  Hopefully the other cruise lines will follow.

Thursday, September 18, 2008

Fuel Supplements Remain: The Cost to Cruise...and How Farming Gives the Answer.

Every morning at 7:00 a.m. I enjoy my "Breakfast with the Farmers" at the local coffee shop. You never know what is going to be the topic or topics of the day. And, readers, you need to stay with me on this one. It will all come together; I am not just rambling!

Yesterday we were discussing the best way to install a French drain near a paddock...only to be interrupted by a phone call: One of the guys just shot the first 8 point buck of the season and we had to come outside to see it in the back of his truck. Then it was back inside to discussing Charley and Arnold, a gentleman farmer's two pet pigs and how they soon would transform from pets to dinner.

Today the topics were much different. One farmer asked us to guess what he was quoted per ton for a common fertilizer. Another guessed something he thought was outrageous: $600. Wrong: It was over $1,000. The farmers are thinking about accepting lower yields next year by not fertilizing this fall, as net they just might make more money...or at least not lose any.

Then another farmer said his diesel fuel supplier called offering him "off road" diesel for $3.10 a gallon. The farmer, actually be quite astute said, "Last year when oil was at $100 you were charging $2.49 a gallon. Oil is now $96, so you are way too high. Call me back when the price drops more." (We see the same thing at the gas pump, don't we?!)

Someone then noted that "off road" diesel was selling for less than home heating oil; which, of course, made no sense since it is a far more refined product. (Home heating oil has far more sulfur and particulates in it.) The reason was then given: The home heating oil companies purchased futures contracts and were saddled with the contracted for higher prices.

I then started thinking about the fuel supplements which the cruise lines are charging. Both Carnival Corp. and Royal Caribbean have stated in the just the past few days that they will not be reducing (or, heaven forbid) eliminating the fuel supplements now because the oil market is so volatile. I think it is a bit more than that, however.

Just as the guy who is selling the fertilizer today is incorporating the past months effects on his operating costs and just as the diesel fuel company is charging 25% more despite the current oil prices and just as the the home heating company is still being charged more (though they guessed months ago the price was a good one) so they have to charge you more, the cruise lines' operations and costs are not tied directly to the present day oil prices.

Also keep in mind that there was a good bit of hedging that the dollar would continue to drop, so many contracts might well have been priced keyed to the Euro. With dollar much stronger at present (which is based on the unexpected weakness in the European economy, rather than confidence in the U.S. one), the cost for the purchaser can also have increased since it now takes more Euros to equal a dollar.

So whether the cruise lines have longer term contracts or shorter term deliveries, the cost of fuel, lubricating oils, etc. are still much higher despite the current drop in oil prices. And with the current incredibly volatile market conditions, it would be reckless to simply key the fuel supplement only on the price of a barrel of unrefined oil. (There is, of course, another option: Quietly raise cruise prices to cover this fluctuating cost. I am not liking that idea at all and, to be sure, I am certain the cruise lines know that you don't either.)

As Laurel was chided by Hardy (am I dating myself), "Well, Stanley, this is another fine mess you have gotten us into!"

UPDATE:  Carnival Corp. just posted its earnings for the Third Quarter 2008 and they are quite strong.  On the issue of fuel supplements Carnival Corp stated:  Based on current spot prices for fuel of $598 per metric ton, full year 2008 fuel expense is now forecast to increase by $678 million compared to 2007, which will have the effect of reducing full year 2008 earnings by $0.83 per share. The existing fuel supplements in place, if entirely incremental, are expected to offset approximately 25 percent of the $678 million fuel price increase for 2008. With current supplements remaining in place for 2009, and assuming current spot prices stay in place for all of 2009, the company estimates that approximately 43 percent of the cumulative increase in fuel costs since 2007 would be offset.


Simply stated, the fuel supplements have only addressed 25% of the increase in fuel from 2007 and it is projected that if things stay the same they will still only offset 43% of next year's increased fuel costs (still compared to 2007).  It seems that we will be keeping the fuel surcharges for quite a long time.

Friday, September 5, 2008

How to Handle...And Not Handle...A Hurricane

With hurricane season well and truly upon us (Thanks to Fay, Gustav, Hanna, Ike and...) there are a few things which need to be mentioned; highlighted by the USA Today report about the Mutiny on the Carnival Miracle.

First, any passenger traveling to the Caribbean between August and October must (that is "must") understand that ship happens during hurricane season. If you have saved up for your one and only trip to St. Thomas or you have finally decided to "now or never" swim with the stingrays in Grand Cayman this is not the season to book your cruise to do it. Fly to the destination and do a land-based holiday. You may get wet, but you only have to deal with problems if the hurricane is going to be over the top of you...rather than blocking the ship's path back to port.

Second, be flexible. Even if your itinerary isn't what it was supposed to be remember that First and Foremost, you wanted to be on a cruise. You spent how much time selecting the ship, which cabin, avoiding which airports, etc.? You think (or post) endlessly about your favorite waiters, the "secrets" of enjoying the ship more, how the entertainers are going to be, whether there will be new towel animals and have pre-booked the spas and specialty dining areas. Even if you don't get to go to a port, you have the ship...and that is THE major destination for most Caribbean cruises.

Third, hope and pray the cruise line handles it well. Here I can give you too great recent examples...one Excellent and one, apparently, terrible.

A. Excellent - During my recent cruise on Royal Caribbean's Mariner of the Seas we dodged Fay, but had to deal with Gustav. As a result our 4 port cruise (Labadee, Ocho Rios, Grand Cayman and Cozumel) became only 2 ports (St. Thomas and St. Maarten). Captain Johnny gave a very detailed explanation over the ship's PA system (which was great for those that could not understand his very enthusiastic and upbeat Norwegian accent!). BUT RCCL DID MORE: The Cruise Director and Captain broadcast a detailed explanation over the television system using charts, weather tracking information, travel distances, etc. leaving absolutely no question in any reasonable mind that every option was taken into account (even, "Well we could have sneaked into Labadee and then changed course, but you would have been met with a cold, rainy and windy beach along with rough seas, so we opted for a sea day with sunny skies and smooth seas")...and then they explained it again; confirming the difference in port charges would be added to everyone's onboard account. Yes, there was disappointment for many with less ports and more sea days...and being in St. Thomas again (though there were happy shoppers) and being in St. Maarten with 10,000+ cruise passengers, but most everyone understood. (There were a few out of control passengers, but they were far and very few between). All in all it was handled extremely well by the cruise line and the passengers.

B. Terrible - In today's USA Today online there is a blog about there being a virtual Mutiny on the Carnival Miracle not only because of the change in itinerary caused by Hanna (including a non-Caribbean port call in Newport, Rhode Island...which I personally love), but because of the way the captain has purportedly handled it. USA Today reports that one CruiseCritic poster claims "The attitude of the captain has caused passengers to (go) ballistic" and that the passengers are shouting "Refund! Refund!" while threatening to penalize the innocent crew by reducing their gratuities to "zero". Now, I have been around long enough to know that not every CruiseCritic poster portrays things as accurately as they might and that some have agendas which are not totally honorable, but where there is smoke there is a good chance of fire. Quite possibly an understanding and warm explanation that there as no way to cross Hanna's path safely (which should be obvious) either on the way and/or the way back coupled with an explanation that because of the size of the Miracle, Bermuda was not an option (I am assuming here), Carnival might have avoided the Mutiny.

Alas, there is a reason my motto/business plan is very simple: Be Treated By Your Travel Agent As You Will Be Onboard! I expect to be treated exceptionally well. If I do not believe I will be, I will not board the ship and will not suggest such a ship to my clients. (Ironically, I have 8 clients sailing on the Carnival Miracle tomorrow! I will be able to let you know how Carnival response to Ike with more direct info!)

Personally, no matter how arrogant the captain may be, no matter how bad the ports may be, no matter how disappointed you may be, you are still on a cruise...on the ship of your choosing...and the ship has lots of good things to do. Why ruin the entirety of your cruise while you are on it? Make the best of it and, if ultimately appropriate, complain when you return. BUT REMEMBER, you chose to cruise during hurricane season. (Did you like the discounted price offered on your cruise? You could have taken the same cruise Christmas for lots more money. First ask yourself, "Why was the cruise discounted so much?" and then write your letter.)

Wednesday, September 3, 2008

Iamboatman Book Review: "Cruise Confidential: A Hit Below the Waterline"

UPDATE:  I guess the author liked my review (below).  You can also read it on his website:  http://lovebruns.com/Templates/Review_GoldringTravel.html.

I just finished reading a very light, but interesting, book entitled: Cruise Confidential: A Hit Below The Waterline. One Crazy Year Working on Cruise Ships. It is probably worth a few hours to read it as it does put into perspective some of the ups, downs, trials and tribulations of training for, and working in, cruise ship restaurants.


While the author of this non-fiction book, David Brian Bruns, seems to place himself as the virtuous, never straying, deeply devoted boyfriend chasing his Holy Grail girlfriend, Bianca...and, of course, while being the best waiter ever to have served on the seven seas, for pure voyeuristic enjoyment and as a vehicle to tie all the craziness together, without it having a total feel of a trashy novel, it works.


Without ruining the book, Mr. Bruns discusses (exposes?) the relatively - OK, absolutely - wild, sleep deprived, cramped, smoky and sexually active lives below deck. Not unlike the yachting industry (only more-so due to the horrific number of hours/weeks/months worked without a real break), much of the focus is on sex being used as a tension release rather than for intimacy. I say this upfront because you need to read through the regular references to it in order to find the real nuggets of information and perspective.


One of the starkest realities is that most of the ship's waitstaff (and, to be sure, others) simply do not understand the general American philosophy or approach to many different things. This goes far beyond the concept of as an American we tend to think of owning a car and having a private home (rented or owned) as birthrights while some crew will work years on a ship just to be able to buy a used car.


Some things really make you think. A negative example: Why do we require the buffet to look as if no one has been there before us even minutes before it closes? (The amount of needless waste created as a result is shocking.) A positive example: Why do many of us actually care about those serving us; asking about our waiter's family and life at home? (Many cultures are such that waitstaff should not even be acknowledged.)


So enjoy reading about how the staff is trained and what they are actually trained for (it is not just about serving food), realize the hours it takes to put together all the things and time needed for a breakfast or dinner service (and the differences between them!), appreciate the working of 15+ hours a day without a break for months, ponder how and why the supervisors are so tough in a "survival of the fittest" world, and enjoy the descriptions of the Eastern European beauties and Turkish and Caribbean musclemen...or just the need for a tattoo.


But remember this is book about one American's experience on Carnival in the days when they were The Fun Ships, where cheap cruises and huge amounts of alcohol were the rule...apparently both above and below the decks. I am sure much of it remains valid today, for as I have said, I have seen similar (but not quite as wild) behavior on superyachts, but I would suggest that when you board a Seabourn ship you will see far fewer bloodshot eyes and encounter far fewer with slurred speech from the crew party the night before.

And, ironically, understand just how profitable it is to be an art auctioneer aboard a cruise ship. (See my last post!)