Posts Tagged ‘Hawaii’

Pride of America: NCL’s Highest Yielding Ship

March 10, 2017
(Courtesy NCLA)

(Courtesy NCLA)

President and CEO of Norwegian Cruise Line Holdings, Frank del Rio recently said, on the company’s fourth quarter and year-end earnings: “These benefits include Pride of America, the highest yielding ship in the Norwegian fleet, is in service for the full quarter, versus the prior year where she was in a 25-day drydock”

(NCL)

Malcolm says: That’s surprising news to me. I’ve always wanted to cruise inter-Hawaiian-islands with NCL, but the fares are quite high and the long-haul air fare from the UK would make it a very expensive cruise indeed.

‘Pride’ gets quite mixed review with the quality of food, mediocre service and small cabins being matters for some customer dissatisfaction. She’s a strange looking ships externally, but her American themed interiors have recently undergone a major re-fit.

A few years ago NCL said ‘Norwegian Epic’ was their best performing ship.  I was not surprised at that news, given the fact that ‘Epic’ is the biggest vessel in the NCL fleet, carrying more passengers. She  has more alternative (surcharge) dining venues that their other ships, so the potential for on-board income generation must be bigger.

The ‘NCL America’ brand was created to cruise the Hawaiian islands, but the brand has been fraught with operational difficulties. ‘Pride of America’ (2005, 80,439 gt) homeports in Honolulu.

I think NCL though that Hawaii would be the ‘new’ Caribbean and passengers would flock there in their millions. NCLA gained a monopoly to cruise inter-Hawaiian islands. They had three large ‘Us-Flagged’ ships operating in Hawaiian waters at one point. They even purchased the legendary ocean liner the ‘SS United States’, for their NCLA, which was in lay-up. They promised to renovate her and return her back to service, but of course they never did. However demand for Hawaiian cruises never did meet NCL’s expectations and ‘Prides’ two fleet mates were re-deployed to other parts of the world.

I understand that NCLA was not  very profitable originally, for three main reasons:

One: The deal with the Hawaiian authorities was that the ships crew must be largely America. Recruiting crew with the correct customer service ethos proved difficult. Also due to the high standards of living in Hawaii/USA the crew had to be paid first world wages.  (Traditionally cruise lines often employ third world staff on lower wages to maximise their profits.)

Two: The NCLA ships were not allowed to operate Casino’s in Hawaiian waters,  which are one of American ships most profitable areas of on-board income generation.

Three: NCLA was faced with higher staff costs, less on-board income generation, but had to offer completive fares with other cruises in American waters, such as the Caribbean.

So back to Frank del Rio’s opening statement saying that ‘Pride’ is their highest yielding ship. Although NCLA has had a turbulent history, the islands are acknowledged as being beautiful, ‘Pride’  still has a monopoly and she can command higher fares.

Any other suggestions as to how they turned things around and achieved this success will be welcomed.

Malcolm