Did P&O Order the Wrong Ships?

[Billish]

I know hindsight is a wonderful thing, but with unprecedented inflation rates, interest rates increasing, and a consequent squeeze on disposable income,  I wonder if the bosses at P&O/Carnival now wish they had ordered two Royal class ships (or at least one) rather than  both Iona and Arriva ? 

I appreciate that all business decisions are judgement calls,  but to put all your eggs into the mega cruise ship basket,  seems to be somewhat perverse. 

I struggle to see how P&O can generate profitable occupancy levels across the fleet over the next 24 months.

 

[Britboys]

The Excel Class ships are cheaper to run, using LNG as opposed to diesel and it has been suggested that they can run okay at 40% occupancy. They may prove to be more profitable than a Royal Class ship...?

 

[david63]

And don't forget that a cruise ship has a life of around 20 years - and a lot can, and will, change in may ways in that time.

[Bobblehat71]

Nothing wrong with the size of Iona or Arvia . The problem is they just don't offer anything new . They are just bigger ships with more cabins. The only difference between IONA and Ventura is that it takes you twice as long to get any where 😉 RCI and NCL pack more facilities into ships much smaller than Iona and Arvia. 😎

[gsmt47471015]

17 minutes ago, Bobblehat71 said:

Nothing wrong with the size of Iona or Arvia . The problem is they just don't offer anything new . They are just bigger ships with more cabins. The only difference between IONA and Ventura is that it takes you twice as long to get any where 😉 RCI and NCL pack more facilities into ships much smaller than Iona and Arvia. 😎

And don't appear to have the docking problems?

[Billish]

18 minutes ago, Bobblehat71 said:

Nothing wrong with the size of Iona or Arvia . The problem is they just don't offer anything new . They are just bigger ships with more cabins. The only difference between IONA and Ventura is that it takes you twice as long to get any where 😉 RCI and NCL pack more facilities into ships much smaller than Iona and Arvia. 😎

My point was reallly about passenger numbers. Can P&O get sufficient passengers on them, year round ?

[Bobblehat71]

2 minutes ago, Billish said:

My point was reallly about passenger numbers. Can P&O get sufficient passengers on them, year round ?

 

I think all cruise lines are going to be hard pushed to fill ships over the next couple of years regardless of size. Its definitely the wrong size ship to be going back and forth to Norway every week. That said its not really designed for warmer climates either.   

[BouncingWheel]

If they only need 40% capacity at normal pricing to break even then they should be easily able to get above that with use of some discounting etc... even in trying times. However, my opinion is that will lose more regular, current P&O customers - who want more than just a floating, basic, cruise experience - and pick up loads of one-off try P&O/ try cruising passengers who see it as a very good value holiday.

So my opinion to your question is I think they will be fine but the difference between Adult only and these 2 new ships will become even more chalk and cheese.  In 5-10 years time they will become a 100% budget cruise line like P&O Australia but that will also work as every industry needs them.

[terrierjohn]

2 hours ago, david63 said:

And don't forget that a cruise ship has a life of around 20 years - and a lot can, and will, change in may ways in that time.

Struggling to load your site David, on all browsers.

[Bobblehat71]

26 minutes ago, BouncingWheel said:

If they only need 40% capacity at normal pricing to break even then they should be easily able to get above that with use of some discounting etc... even in trying times. However, my opinion is that will lose more regular, current P&O customers - who want more than just a floating, basic, cruise experience - and pick up loads of one-off try P&O/ try cruising passengers who see it as a very good value holiday.

So my opinion to your question is I think they will be fine but the difference between Adult only and these 2 new ships will become even more chalk and cheese.  In 5-10 years time they will become a 100% budget cruise line like P&O Australia but that will also work as every industry needs them.

 

Great post, 

I've been on two P&O cruises in the last 10 months. My next two are on MSC and Royal Caribbean.

Whilst P&O offer good value for money they don't provide what I would consider to be the full cruise experience. I've spoken to a few couples on P&O recently who were new to cruising and they all said that they were disappointed with the cruise experience. Typically they commented that it just wasn't as exciting or as much fun as they were led to believe by friends and relatives. I suspect those friends and relatives had sailed with the likes of RCL , NCL or Celebrity etc . IMO P&O either have to up their game considerably or as you say resign themselves to being a budget cruise line. I don't think they can have it both ways.

 

[Gettingwarmer]

5 minutes ago, Bobblehat71 said:

 

Great post, 

I've been on two P&O cruises in the last 10 months. My next two are on MSC and Royal Caribbean.

Whilst P&O offer good value for money they don't provide what I would consider to be the full cruise experience. I've spoken to a few couples on P&O recently who were new to cruising and they all said that they were disappointed with the cruise experience. Typically they commented that it just wasn't as exciting or as much fun as they were led to believe by friends and relatives. I suspect those friends and relatives had sailed with the likes of RCL , NCL or Celebrity etc . IMO P&O either have to up their game considerably or as you say resign themselves to being a budget cruise line. I don't think they can have it both ways.

 

To me the cruise experience is cruising. I want to sit on my balcony and watch the sea go by. I don’t wish for all the other things though I can see why others would. 

[gsmt47471015]

Agree the cruise experience is cruising , however that no longer brings in the income that is required, hence the new (relatively) fun palaces , it makes you wonder how many attention grabbing attractions, can be fitted to the new breed of ships throughout the industry. P and O appear to be trying to do both at the same time and as good as the two new ships are they will never compete with Carnival NCL or RC for the facilities on board

[davecttr]

26 minutes ago, Gettingwarmer said:

To me the cruise experience is cruising. I want to sit on my balcony and watch the sea go by. I don’t wish for all the other things though I can see why others would. 

Yes and i like sea days too. I have an Arvia cruise next April with cabin 17.219 booked. It has a large L shaped balcony and essentially a separate bedroom and living area, both with balcony doors. Only a standard balcony because it is considered overlooked and shaded. Not shaded on one leg of the balcony though. I will be spending a lot of time staring at the sea with forays for food and drink plus blackjack. As for ports it would have to be a darn good excursion to interest me, a stroll ashore is sufficient

[Windsurfboy]

By opening up early,  P&O, is pretty well booked up till summer 2024. OK only 5% deposits. Whether people will forgo those deposits is a question. I imagine,  booking for late 2024 and 2025 onwards will be slower.

 

As to if Iona and Arvia are wrong ships time will tell. They are better value economies of scale  . Traditional p&O cruisers are now just trying them out, if they find they can still enjoy the peaceful cruise they liked and service, then P&O will have ship that serves both markets. If they don't return and ships only attract families and young then this is a more volatile markets, plenty of customers in good years , but hard to fill in tough times. 

[FamilyCruiserUK]

I dont think so much the wrong ships as in the size but i do feel they keep missing the ball with onboard activities. RCl, Carnival and NCL have unique activities that people will pay extra for. ( Surfing, ifly, go carts, water slides etc). People will still cruise even during the economic crisis coming., But cruise lines will have to do more to get people onboard. More families are cruising now, so the bigger ships need to cater for families. 

 

People are stuggling i get that i really do. But at same time maybe people need to look at their finances and what they are spending money on. My neighbour was sitting in his graden yest complaining about cost of petrol and gas/electricity whilst watching netflix, smoking and drinking a beer. He dosnt work and is unemployed and not interested in working. ,☹️

 

Also finally, P&O would have got a much better deal buying two ships rather then 1 and newer ships much more efficient as well. 

 

But as i have said in previous posts i have no idea what market P&O are trying to get......

 

[Yorkypete]

5 hours ago, Bobblehat71 said:

Nothing wrong with the size of Iona or Arvia . The problem is they just don't offer anything new . They are just bigger ships with more cabins. The only difference between IONA and Ventura is that it takes you twice as long to get any where 😉 RCI and NCL pack more facilities into ships much smaller than Iona and Arvia. 😎

The only problem with the size is they cannot berth at many Norwegian ports yet knowing this they still send Iona up there next year as well? Bit stupid really.

[Britboys]

5 hours ago, BouncingWheel said:

If they only need 40% capacity at normal pricing to break even then they should be easily able to get above that with use of some discounting etc... even in trying times. However, my opinion is that will lose more regular, current P&O customers - who want more than just a floating, basic, cruise experience - and pick up loads of one-off try P&O/ try cruising passengers who see it as a very good value holiday.

So my opinion to your question is I think they will be fine but the difference between Adult only and these 2 new ships will become even more chalk and cheese.  In 5-10 years time they will become a 100% budget cruise line like P&O Australia but that will also work as every industry needs them.

With reference to "100% budget cruise line like P&O Australia" - of course the current President of Carnival UK was previously the President of P&O Australia...

[Britboys]

4 hours ago, Windsurfboy said:

By opening up early,  P&O, is pretty well booked up till summer 2024. OK only 5% deposits. Whether people will forgo those deposits is a question. I imagine,  booking for late 2024 and 2025 onwards will be slower.

 

As to if Iona and Arvia are wrong ships time will tell. They are better value economies of scale  . Traditional p&O cruisers are now just trying them out, if they find they can still enjoy the peaceful cruise they liked and service, then P&O will have ship that serves both markets. If they don't return and ships only attract families and young then this is a more volatile markets, plenty of customers in good years , but hard to fill in tough times. 

I guess it depends whether they 'Iona-ise' the cruise experience on Azura/Ventura/Britannia. If they don't, regular P&O cruisers may try Iona and decide to stick with the other ships. That's the whole thing about the way P&O is changing. Some of us will desert the company entirely, some will stick to the smaller large ships and others will enjoy them all...

[molecrochip]

I should really do a long response for this but don't have the time:

• Iona/Arvia generally make a profit above 35% full
• Britannia generally makes a profit above 40% full
• Iona/Arvia were the only ships available to order at the time. The other Royal class ships were already allocated and by the time Iona was ordered, they were old designs and not meeting current company requirements - such as LNG.
• Princess have since ordered two new Sphere class ships instead of more Royal class.
• The research says that UK punters don't want to pay the extra for surfing or flights over the top deck - therefore return on investment is difficult.
• This is in part still because P&O has to balance offseason demand being very 50+ whereas American ships, because of their quick access to say, the Caribbean, still attract a good mix of 30-80+ during off season.
• New ships will continue to develop the offering but most items won't be forced upon the older ships.

 

Finally, P&O have taken the point that people like the branded shows that RCI offer, and have taken a first step with bringing Greatest Day onboard Arvia. This is the rebranded musical orignally called The Band and is based around the Take That songbook underlying the continued relationship with Barlow and Co. This highlights well the demographic being targeted.

[Britboys]

2 hours ago, FamilyCruiserUK said:

...Also finally, P&O would have got a much better deal buying two ships rather then 1 and newer ships much more efficient as well...

 

Moley's post has pretty much superceded this but I was going to say that Carnival Corporation ultimately decide which new ships go where and they ordered 7 in the same class as Iona plus 2 more almost identical...

[terrierjohn]

7 minutes ago, molecrochip said:

I should really do a long response for this but don't have the time:

• Iona/Arvia generally make a profit above 35% full
• Britannia generally makes a profit above 40% full
• Iona/Arvia were the only ships available to order at the time. The other Royal class ships were already allocated and by the time Iona was ordered, they were old designs and not meeting current company requirements - such as LNG.
• Princess have since ordered two new Sphere class ships instead of more Royal class.
• The research says that UK punters don't want to pay the extra for surfing or flights over the top deck - therefore return on investment is difficult.
• This is in part still because P&O has to balance offseason demand being very 50+ whereas American ships, because of their quick access to say, the Caribbean, still attract a good mix of 30-80+ during off season.
• New ships will continue to develop the offering but most items won't be forced upon the older ships.

 

Finally, P&O have taken the point that people like the branded shows that RCI offer, and have taken a first step with bringing Greatest Day onboard Arvia. This is the rebranded musical orignally called The Band and is based around the Take That songbook underlying the continued relationship with Barlow and Co. This highlights well the demographic being targeted.

Most of what you say make sense, however I think P&O have made a big mistake by not putting water slides on Arvia. As she will winter in the Caribbean and spend her summers mainly in the Med, this would have been a very sensible option.

Similarly if Azura is going to be in the Med all summer and Canaries in winter, she would be an ideal candidate for water slides, and could benefit from a major refit like RCIs Independence of the seas did.

[FangedRose]

35 minutes ago, terrierjohn said:

Most of what you say make sense, however I think P&O have made a big mistake by not putting water slides on Arvia. As she will winter in the Caribbean and spend her summers mainly in the Med, this would have been a very sensible option.

Similarly if Azura is going to be in the Med all summer and Canaries in winter, she would be an ideal candidate for water slides, and could benefit from a major refit like RCIs Independence of the seas did.

Yes, but outside of the six week school holidays the average age of passengers is very much 50+. Not many of that age would be interested in waterslides (would insurance even cover it?). USA school holidays are much longer (three months?) therefore have the younger family market for a greater length of time. The thing that puts me off the larger 'resorts type ships is the amount of stuff that takes up most of the space that I am not interested in doing, unable to do and/or is pay extra. I look at them and see such as flo rider, climbing walls and water slides etc and think 'well I won't be doing that'.

[Megabear2]

1 hour ago, terrierjohn said:

Most of what you say make sense, however I think P&O have made a big mistake by not putting water slides on Arvia. As she will winter in the Caribbean and spend her summers mainly in the Med, this would have been a very sensible option.

Similarly if Azura is going to be in the Med all summer and Canaries in winter, she would be an ideal candidate for water slides, and could benefit from a major refit like RCIs Independence of the seas did.

We are getting reports that Ionas pools are full with kids at present.  If you stick water slides in there won't be much room for people like me sho just enjoy a leisurely poodle up and down.  As for the early morning keep fit swimmers slides would be devastating for their turns etc.   There are no lifeguards in P&O ships, there are on RCI and MSC ships with slides.  As someone with big time swimmers, judges and swim teachers all around them I'm told its because the slides are more of a drowning/accident area.

[FamilyCruiserUK]

1 hour ago, molecrochip said:

I should really do a long response for this but don't have the time:

• Iona/Arvia generally make a profit above 35% full
• Britannia generally makes a profit above 40% full
• Iona/Arvia were the only ships available to order at the time. The other Royal class ships were already allocated and by the time Iona was ordered, they were old designs and not meeting current company requirements - such as LNG.
• Princess have since ordered two new Sphere class ships instead of more Royal class.
• The research says that UK punters don't want to pay the extra for surfing or flights over the top deck - therefore return on investment is difficult.
• This is in part still because P&O has to balance offseason demand being very 50+ whereas American ships, because of their quick access to say, the Caribbean, still attract a good mix of 30-80+ during off season.
• New ships will continue to develop the offering but most items won't be forced upon the older ships.

 

Finally, P&O have taken the point that people like the branded shows that RCI offer, and have taken a first step with bringing Greatest Day onboard Arvia. This is the rebranded musical orignally called The Band and is based around the Take That songbook underlying the continued relationship with Barlow and Co. This highlights well the demographic being targeted.

Great post

[FamilyCruiserUK]

7 minutes ago, Megabear2 said:

We are getting reports that Ionas pools are full with kids at present.  If you stick water slides in there won't be much room for people like me sho just enjoy a leisurely poodle up and down.  As for the early morning keep fit swimmers slides would be devastating for their turns etc.   There are no lifeguards in P&O ships, there are on RCI and MSC ships with slides.  As someone with big time swimmers, judges and swim teachers all around them I'm told its because the slides are more of a drowning/accident area.

The slides are extra to the main pools so in fact more children will be away from the main pool. But as always there is a "kids" season and an "adult" season. But if P&O want to push into the US market whilst in the carribean then the American passengers with kids want more then what P&O offer. We were P&O fans for a while but post having a child we are Royal fans. That said we are trying Arvia next summer.