Cruise Lines Under Pressure to Significantly Raise Ticket Prices

Cruise companies may be eyeing a significant increase in ticket prices in the near future as demand surges and sailings sell out in record time.

“Wall Street is not happy,” said one source familiar with the situation. “If cruises are flying off the shelves, the message from big investors has been to raise prices if inventory is selling too quickly … the companies are leaving too much money on the table.”

Cruise lines have widely reported strong pent-up demand and record sales volumes in media announcements, leading to a backlash from the investment community.

Carnival said sales were solid due to pent-up demand in late February, and a few weeks earlier, Oceania saw its world cruise sell out in a single day.

Victory Cruise Lines and American Queen Steamboat said that January and February 2021 bookings are over 35 percent higher than November and December 2020 bookings, according to a press release.

The story is also good at Royal Caribbean Group, with bookings up 30 percent.

“Despite the lack of marketing spends, we have seen a 30% increase in new bookings since the beginning of the year when compared to November and December,” said Jason Liberty, CFO, speaking on the company’s recent business update and fourth-quarter earnings call.

Among other examples, Norwegian Cruise Line Holdings has seen a demand uptick recently with new cash bookings.

“And while still early in the booking cycle, we are very encouraged and very pleased by the strong booking activity driven by pent-up demand across all three brands for 2022 voyages. Volumes during January and February sequentially improved by over 40 percent from November and December 2020, and as an added bonus over 80 percent of these bookings were new cash bookings,” said Frank Del Rio, president, and CEO, speaking on the company’s fourth-quarter and year-ending earnings call.

Two Workers Have COVID-19 Aboard Royal Caribbean’s New Odyssey of the Seas

Odessey of the Seas transiting the river Emms.

Two workers from the Meyer Werft shipyard aboard the Odyssey of the Seas, Royal Caribbean International’s newest cruise ship, have tested positive for COVID-19 with the ship alongside a pier in Bremerhaven, Germany, according to news reports.

Having recently completed its Ems River conveyance to Bremerhaven, the shipyard and its workforce have been putting the final touches on the new Quantum Ultra-class vessel ahead of scheduled sea trials and its eventual delivery later this month. 

According to a German media report, citing a spokesperson from the Meyer Werft shipyard, those two workers and close contacts have been put into quarantine. 

Another estimated 500 crew and workers aboard the ship are being asked not to leave the vessel.

It is unknown whether this will delay the delivery of the ship.

Earlier in the week, Royal Caribbean made big news when it announced the Odyssey of the Seas will be sailing from Haifa, Israel in summer 2021. According to a press release, Royal Caribbean will offer Israelis a combination of three- to seven-night escapes visiting the Greek Isles and Cyprus. The new sailings will go on sale on March 9.

The roundtrip sailings from Haifa will include visits to destinations in the Mediterranean, including Rhodes, Santorini, Mykonos, and Athens, Greece, and Limassol, Cyprus, the cruise line said.

According to the press release, residents of Israel will be the first guests to cruise on Odyssey during its inaugural season. The Prime Minister of Israel, Benjamin Netanyahu, said this became possible thanks to an effective nationwide vaccination program.

The government has set March 17 as the earliest date from which international travel could resume.

Courts referred to travel restarting “at some point after May 17”. Asked by the committee to explain, he said: “I understand the requirement for as much certainty as possible. At this stage, it would be premature to be too precise. We do need to work through some really quite complicated issues.
“We have said there won’t be any travel before May 17 and we’ll look at travel restarting as soon as possible after that.”
He insisted: “We don’t yet understand the extent to which vaccinations reduce transmission and every country will need to be happy with any system used.
“The second point is new variants. We have to guard against these. The science is still catching up.”
Courts argued: “We had the earlier Global Travel Taskforce but a number of things have changed. It’s critical we take stock and work closely with all our sector colleagues to make progress.
“All you are hearing from other countries is an intention to do something.”
He told MPs: “We’re looking at a suite of factors, building on the suite of measures already in place. We would like to see travel facilitated in a way that is smoother, in a way that uses technology. I expect to see a suite of measures.”
Asked whether people can be confident to book summer holidays, Courts said: “We’ve seen this is an unpredictable virus. It is not possible to predict. It isn’t possible to tell individuals or families what to do.
“I suggest what people have to do is give themselves options, give themselves flexibility, look at booking terms, look at insurance.”
He confirmed the task force report would go to the Prime Minister for consideration before its recommendations are made public.
Courts said: “We will be laying out a plan in April and then looking to operationalize that. April 12 will be the date we report back to the Prime Minister. We then have a process of looking at the recommendations.”
He argued: “The date we should be concerned about is the date people are due to travel.
“The evidence looks promising but we want to make sure what is in place is sustainable. We have to be slightly cautious at the moment. This has to be robust.”