Future cruises being sold to full capacity

[richstowe]

18 hours ago, DirtyDawg said:

Your statement reminded me of what a CEO of one of the largest oil company's said to me in 2008. Back then Oil was $140+ per barrel, demand was high, and supply was restricted. He said with a straight face that we'd never see $100 oil again, meaning 'no such thing as cheap oil in the future'.  He was right in one sense, oil has hardly ever gone to $100 since 2008, but it has been up to, not down to!

 

Prices can go up. 📈 Prices can come back down. 📉

 

Perfect analogy . When prices are high with profits to match , both the oil and the cruise businesses plan for never ending growth . Both have long capital lead times . Only by shutting down marginal rigs and older ships were they able to reduce supply, for now . 

There are lots of huge spanking new ships on order and as always prices will go up and prices will go down .

[TheMastodon]

On 6/24/2021 at 4:28 PM, ampurp85 said:

I normally prefer smaller ships but couldn't pass up the great deal to try Sky class. I recall reading that Oasis and quantum class ships only need to be at 35-ish percent capacity to profitable. While the other classes have to be over 60%. I have also been told by many other pax that on those classes you usually don't feel the crowds because of how the space is utilized. Based on looking at available rooms, it looks like my Oct Allure will maybe hit 70%

 

 

 

That is absolutely insane (if true) that a 35% occupancy would be profitable.  Wow!!!

 

 

[DirtyDawg]

10 minutes ago, TheMastodon said:

 

That is absolutely insane (if true) that a 35% occupancy would be profitable.  Wow!!!

 

 

They might generate enough cash flow to fund ship operations at 35% but there's no way they are profitable, covering corporate costs, marketing,  and other costs like interest of the debt to build them in the first place,  at 35% capacity. 

Edited June 29, 2021 by DirtyDawg

[ipeeinthepool]

41 minutes ago, TheMastodon said:

 

That is absolutely insane (if true) that a 35% occupancy would be profitable.  Wow!!!

 

 

 

If the cruise line can be profitable at 35% occupancy, they will be printing money when occupancy returns to normal.

[rjrpar]

21 minutes ago, ipeeinthepool said:

 

If the cruise line can be profitable at 35% occupancy, they will be printing money when occupancy returns to normal.

You don’t understand. See post #78

[ipeeinthepool]

8 minutes ago, rjrpar said:

You don’t understand. See post #78

 

I'll bet I do.

[boscobeans]

2 hours ago, ipeeinthepool said:

 

If the cruise line can be profitable at 35% occupancy, they will be printing money when occupancy returns to normal.

+1

 

It has been quoted by Royal Caribbean that the break even point is 50%

35% would be an operational loss and hopefully only a part of a limited TEST cruise. 

[ipeeinthepool]

17 minutes ago, boscobeans said:

+1

 

It has been quoted by Royal Caribbean that the break even point is 50%

35% would be an operational loss and hopefully only a part of a limited TEST cruise. 

 

Even at 50% capacity break even point, the cruise lines would be printing money at normal capacity levels.

[coffeebean]

On 6/28/2021 at 2:42 PM, graphicguy said:

Agree.  I hope those who have NCL cruises scheduled will have a great time, and all will go according to plan.

 

Personally, I've got a bone to pick with them.  I was one of their most loyal customers/passengers.  They begged me to keep rolling over my fare to the next cruise (cancel), then the next cruise (cancel), then the next cruise (cancel).  Finally, after much fanfare, they announced "we're back", only to cancel on me for the last time.  Enough was enough.  I finally requested my refund, after they used thousands of dollars of mine as a free, interest free loan.

 

Even now, NCL originally told me they would deposit my refund in two weeks from my request.  Then, they told me 4 weeks.  Now, they say it will be 90 days.

 

I do not want to see them go under because I know many of you here are waiting to cruise with them, again.  I also don't want to see them go under before they give me back the money they promised (which is my money to begin with).

 

That said, I'm fearful.  They could have had revenue sailings by now.  They had staffed ships (Joy and Gem) ready to go in the Caribbean.  They punted those (and me) under the guise of needing the staff for both ships to sail the Encore to Alaska....all the while raising the price of that cruise to astronomical levels.  The optics are terrible, customer service and retention even worse,  as I've been driven away from NCL, by NCL.

 

As such, I looked at Royal.  Their wishy-washy stance on COVID Vaccinations made me look elsewhere.  Ended up on Celebrity, who seems to be really trying hard to get this whole start up going again, and doing it well.

The way NCL has been #@!%^&* you around is abhor-able. Having said that, I wonder if it is because they are doing everything they possibly can to stay afloat. There is one other poster who is in the same boat as you (no pun intended). I feel bad for her too. I think it is @JamieLogical who has also said she is abandoning NCL.

 

This just makes me very sad. I have really enjoyed our time on NCL ships and I hope beyond hope they make it through this terrible time.

 

I wish you the best too.

[JamieLogical]

2 minutes ago, coffeebean said:

The way NCL has been #@!%^&* you around is abhor-able. Having said that, I wonder if it is because they are doing everything they possibly can to stay afloat. There is one other poster who is in the same boat as you (no pun intended). I feel bad for her too. I think it is @JamieLogical who has also said she is abandoning NCL.

 

This just makes me very sad. I have really enjoyed our time on NCL ships and I hope beyond hope they make it through this terrible time.

 

I wish you the best too.

 

Yes, I have Celerity booked for July and January. Hoping to use up all of our CruiseNext and FCC on our September 26 B2B on the Breakaway and then planning to at least take a significant break from NCL.

[ampurp85]

@TheMastodon Turning a profit on a couple of sailings, is no where near the idea of printing money at full capacity. I specified Oasis and Quantum class ships only when talking about profitability. They hold over 5000 pax and sell the fares at almost double or more of the smaller classes. With 35% at the price point, that's like sailing at full capacity in any other class. Plus factor in all the extra things they charge for and the profit from Royal Class. Like a 6 day on Mariner is roughly $500 in an inside but close to $800 on an Oasis or Quantum ship, not to mention that a star class cabin could be $5000 per person. You might spend $1000 per pax for the DBP/UDP/Voom and fare for a lesser class but $4000 for that on Oasis.

 

Being able to make money on reduced capacity sailings for this particular situation is a good thing. But that profit will have to go towards all the debt they have accumulated during shutdown. I run a restaurant and during shut down we kept turning a profit, great based on the fact that the dining room was closed. But no where near what we normally do since the dining room was closed. As a business I am sure RCG understands that something is better than nothing. They understand that there is a threshold they can operate to make things worth it.

[Tyro1]

2 hours ago, boscobeans said:

+1

 

It has been quoted by Royal Caribbean that the break even point is 50%

35% would be an operational loss and hopefully only a part of a limited TEST cruise. 

I bet by stopping at perfect day twice or even once, they are able to break even at lower capacities, I bet that water park, cabanas and beach club prints them money. 

[sunshinetricia]

2 minutes ago, Tyro1 said:

I bet by stopping at perfect day twice or even once, they are able to break even at lower capacities, I bet that water park, cabanas and beach club prints them money. 

I assumed with less people on the island that they would charge less for the cabanas because there would be less demand. Doesn't seem like it! Floating cabanas are now up to close to $2K for the day. 

[Itchy&Scratchy]

1 hour ago, sunshinetricia said:

I assumed with less people on the island that they would charge less for the cabanas because there would be less demand. Doesn't seem like it! Floating cabanas are now up to close to $2K for the day. 

they are sold out for my cruise at $1,899.00. Non-floating ones are $999-1,299.

[Biker19]

5 hours ago, ipeeinthepool said:

 

Even at 50% capacity break even point, the cruise lines would be printing money at normal capacity levels.

For context, before COVID, RCCL ships were averaging about 108% occupancy and their profit was about 10% with a lot less debt than they have now.

Edited June 30, 2021 by Biker19

[ipeeinthepool]

1 hour ago, Biker19 said:

For context, before COVID, RCCL ships were averaging about 108% occupancy and their profit was about 10% with a lot less debt than they have now.

So, are you saying you don't believe them when they say 50% is a break even number?

[xpcdoojk]

1 hour ago, Biker19 said:

For context, before COVID, RCCL ships were averaging about 108% occupancy and their profit was about 10% with a lot less debt than they have now.

Quit throwing facts into this otherwise fascinating, profile of people discussing things of which they have zero clue of.  It disrupts the flow of inane comments and opinions, and they will just ignore those facts freely and without reservation.

 

jc

[Biker19]

1 hour ago, ipeeinthepool said:

So, are you saying you don't believe them when they say 50% is a break even number?

At the ship level maybe, no way at the corporate level. 

[Biker19]

1 hour ago, xpcdoojk said:

 It disrupts the flow of inane comments and opinions, and they will just ignore those facts freely and without reservation.

It is interesting to see on the 10Q SEC RCCL statement for Q1 of this year that admin expenses were 2.5x that of ship expenses - pre COVID that was almost 4x. Revenue was 1/3 of ship expenses, and 1/20th of overall expenses.

[ONECRUISER]

9 hours ago, ipeeinthepool said:

 

Even at 50% capacity break even point, the cruise lines would be printing money at normal capacity levels.

They do, normal average Capacity on Royal Ships preCV was 108%. Shoot Shore Excursions alone ones took in Fall 2015 paid $39 and $59, this Fall same week/Ship are $89 and $129

[ONECRUISER]

6 hours ago, Itchy&Scratchy said:

they are sold out for my cruise at $1,899.00. Non-floating ones are $999-1,299.

Last Summer when Booked my Cruises the Cabanas on my Sailings were $399-499 for all of them(minus over Water). 

[graphicguy]

18 hours ago, coffeebean said:

The way NCL has been #@!%^&* you around is abhor-able. Having said that, I wonder if it is because they are doing everything they possibly can to stay afloat. There is one other poster who is in the same boat as you (no pun intended). I feel bad for her too. I think it is @JamieLogical who has also said she is abandoning NCL.

 

This just makes me very sad. I have really enjoyed our time on NCL ships and I hope beyond hope they make it through this terrible time.

 

I wish you the best too.

Thanks….not the end of the world.  

 

I have a cruise booked with Celebrity in a month.  I’m looking at some Royal sailings for early next year.  GF and I are headed to Italy in the first part of December.  So, I’m not sitting on my thumbs (as I’m hear clattering away).

 

Almost pulled the trigger on one of those recent $100 for 5 nights Carnival cruises, but procrastinated too long and the deal went away.

 

As far as NCL, mentioned before, they are either incompetent or in financial trouble (even worse than they’ve stated when begging for bucks from vendors).  Maybe both.

 

While Royal (and Celebrity), Carnival, etc begin revenue cruises, NCL had revenue cruises ready to go (Joy and Gem in the Caribbean) and punted those, (multiple times) which alienated a lot of us who post here, @JamieLogical and @sid_9169, just to name two others.  To add insult to injury, they promised my refund, and so far, have punted giving my money back ($4,500 fare I paid them 18 months ago that they’ve had in their bank account)  not once, not twice, but three times.  I’m still waiting. 

 

I hope the Alaska cruises go off without a hitch.  I have my doubts.  I have some cruise friends on the Alaska cruises.  They had plenty of opportunities to get their ships sailing, again.  So far, they haven’t been able to.

 

[RC Dancers]

On 6/29/2021 at 9:55 PM, ipeeinthepool said:

So, are you saying you don't believe them when they say 50% is a break even number?

 

I don't think you can use pre-covid figures right now. I'm sure there is extra staffing everywhere. I saw on a youtube video, that even the soft serve machine has an attendant.

[Plum Happy]

15 minutes ago, RC Dancers said:

 

I don't think you can use pre-covid figures right now. I'm sure there is extra staffing everywhere. I saw on a youtube video, that even the soft serve machine has an attendant.

There was always one on the Freedom of the Seas when I sailed her twice.  Someone has to fill that thing since kids use it constantly instead of drinking water.

[DirtyDawg]

On 6/29/2021 at 8:28 PM, Biker19 said:

For context, before COVID, RCCL ships were averaging about 108% occupancy and their profit was about 10% with a lot less debt than they have now.

And since the poster was talking about all the money RCL would be 'printing', the average free cash flow margin Pre-Covid was almost ziltch for Royal. This industry doesn't print money at the best of times! It is more of a user of other people's (banks' and bond holders') printed money.