First this from their cheif cruise director John Heald on 9th November

'There are lots of ships making the transition from Europe to North America at the moment and all without incident despite some typical Atlantic weather. And while I wish her and her crew nothing but the best of luck and calm seas I do find it fascinating that the Oasis of the Seas has found the crossing difficult and from what I here she is delayed and some damage has been reported.'

Then Carnival hold a press conference on 13th - the day Oasis arrives - and Gerry Cahill, boss says

"Crazy innovations drive up the cost of the ship, and can also drive up operating costs," Cahill said. "There's a tradeoff between innovation and how much it'll cost you to make that innovation. We don't want to price a lot of our market out."

and Joe Farcus adds
"When we look at innovations, we look at innovations that appeal to almost everyone onboard ... not just to get gimmicky response in the press."

and now John Heald again
...even though I have been in demand more than lifeboat repairmen have been in Port Everglades these past few days……..

Personally I think it demean's Carnival to poke petty points at the competition. They are an extremely successful cruise line with a solid product and a clear (and conservative) strategy, no need to lower themselves to this kind of nonsense. But does it show they are rattled by Oasis and the surrounding hype?

Cruise critic are making the point that Oasis is acrrying a much greater fare premium over fleetmates than Dream is in the comparable itineraries.

Matt

[ 11-17-2009: Message edited by: Mattsudds ]

I'm pleased RCI has not stooped to the same level. They seem quite content to focus on their own product without ever mentioning the competition.

Healds comments on the Oasis sea keeping abilities are really off-putting. He is implying the design is somehow not safe. He fails to mention that plenty of CCL ships have been damaged by weather or even fire in the past. I used to enjoy his blog, but now I see it as a Carnival tool for propaganda. The man has lost all credibility and respect in my book.

Cahill's comments on the other hand, are spot on. He was making a point to the financial community and like it or not, like Oasis or not, one can not argue with his or Arison's statements on the financial implications of the Project Genesis.

Oasis is getting a premium on most dates right now but my money says there will be major yield erosion with the second ship and across the fleet once Allure is in the water.

RCCL has succeeded over the past two and a half decades because of not only the 'wow' factor, but the 'wow, what's next?' factor. With each new class of ship, eveyone is so blown away, they can't imagine what Royal can or will do to top it. But they have always topped their greatest achievements by going bigger and incorporating more innovations.

But with Oasis, not only did they break the glass ceiling, they quickly hit the brick wall. They're going to have a tough time topping Oasis.

my fourteen cents...

The first few revenue-operating weeks of Oasis are going to be critical in that 'word of mouth' can do some serious damage if Royal Caribbeans new golden child isnt it's all cracked up to be. They need to come out of the starting gate at full speed and not stumble, and 6,000 critical passengers a week are sure to have opinions.

Will RCI top Oasis and Allure - well if they do it will be a long time coming, they simply do not have the financial resource to do so, it will take them a good few years to recover to where they were 2 years ago which was still not that fantastic.

Facts are RCI is nervious has heck about Oasis, they have been in our office more the past 6 months then the past 6 years. Our group toured her yesterday and their comments were "Wow she is big, maybe too big." Pricing is being discounted behind the scenes, more so then Carnival Dream. While the RCI loyaliest are excited, there an not enough of them to fill too ships of this size week after week. And our groups (usually 250 to 2000 in size) are not interested in her for incentive and meeting cruises.

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Originally posted by mike sa:

Lets also face facts, RCI issue propaganda to - fact is they have plenty of empty cabins on Oasis - to then say they are "controlling inventory" is frankly BS, if they could sell them and have her full damn right they would, can you imagine the shareholders reaction if they could have sold cabins but didn't - with their debt levels !

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RCI is controlling inventory, they just have a different strategy then bottom feeder pricing. The bottom line is you can't cruise on Oasis for $449 like on CARNIVAL DREAM. If RCI did offer $449 pricing on Oasis I'm sure the ship would fill up, but they are trying to protect the integrity of this new product. I imagine that considering the economy and the generally high yields that Oasis is receiving on the that cabins that have been sold, that the ship is doing ok. Also the operating costs are lower and profit margin higher on OASIS compared to any other ship in the fleet.

Just because you sell every cabin doesn't mean the ship will make a higher profit then if it goes out with some empty cabins. Yield management is a lot more complicated then that. If 90% of the ship is sold at very high yields, and it goes out 10% empty, the bottom line might be the same as if 100% of the ship was sold at very low yields. Also it's likely those paying $399 for a 7-day cruise are not going to as spend much onboard, and may even stiff the staff of gratuities. There is a lot more that goes into the equation then just selling the ship out at the lowest price.

It's interesting that Carnival is offering bottom feeder pricing of $449 on their newest ship (CARNIVAL DREAM), on the inaugural Caribbean cruise out of it's new home port, and there is plenty of space still available. No one seems to comment about that.

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Originally posted by Tim in 'Lauderdale:
John Heald is simply playing to his audience. The blog is read by an audience that is largely comprised of Carnival loyalists, thus he's just poking fun, if being somewhat snarky.

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I think it may be more then just playing to his audience. There is nothing wrong with being loyal to your employer, but I don't think you have to disparage the competition to do it. Let's face it, Heald's blog is a marketing tool of Carnival Cruise Lines. His posts must be edited and approved by Carnival's head office before they are released. Lately they have become more and more aggressive towards the competition, particularly RCI. It's seems very defensive and as I pointed out earlier, a bit tacky and off-putting.

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Originally posted by Tim in 'Lauderdale:

Cahill's comments on the other hand, are spot on. He was making a point to the financial community and like it or not, like Oasis or not, one can not argue with his or Arison's statements on the financial implications of the Project Genesis.

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Cahill's comments may be spot on, but were they necessary? Why spend time talking about the strategies of other companies when you are speaking about the financial results of your own company? I realize that some comparison is necessary, but it appears that recently those in the media eye at Carnival have been speaking more about RCI and Oasis then their own brand. This looks more like a directive then a coincidence to me. Nothing like stirring up financial doubt regarding the competition, which I think may be their objective. It also deflects any questioning as to why Carnival has nothing that compares not only to Oasis, but the Voyager/Freedom Class as well. As I stated earlier, it's really not necessary for Carnival to make any comments regarding RCI. Carnival has excellent financial results, are in the #1 position, and that is not changing.

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Originally posted by Tim in 'Lauderdale:

Oasis is getting a premium on most dates right now but my money says there will be major yield erosion with the second ship and across the fleet once Allure is in the water.

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The same was said about VOYAGER when EXPLORER OF THE SEAS was introduced. All eight Voyager/Freedom Class ships continue to receive a premium over their competition at Princess, NCL, and Carnival. What happens with yields on OASIS will largely depend on the reputation the ship earns, and the economy.

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Originally posted by Tim in 'Lauderdale:

But with Oasis, not only did they break the glass ceiling, they quickly hit the brick wall. They're going to have a tough time topping Oasis.

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On this point I agree, for now. None the less a lot can happen in ten years, and that is pretty much the cycle of new designs from RCI. This was pretty much the case with VOYAGER OF THE SEAS and imagine the same will hold true for OASIS.

A cheep shot? Maybe... or just poking fun at the competition. All tongue in cheek.

Yes, Oasis is really revolutionary... but RCI is taking a risk. Could demand for the innovations on Oasis and Allure reduce demand for other ships in the fleet? Maybe. Voyager ran the same risk back in 1999 when she first sailed. But RCI has since built 7 more Voyager/Freedom class ships and off loaded older ones. This spread the demand more evenly and meant RCI's fleet could offer a fairly similar product across the board.

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Originally posted by Tim in 'Lauderdale:

Oasis is getting a premium on most dates right now but my money says there will be major yield erosion with the second ship and across the fleet once Allure is in the water.

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I just looked up a few fares for December and the December 12th sailing on Oasis runs from $1049.00 for an inside up to $3129.00 for a suite (I don't think that is for one of the cool loft units)

It seems to me that even though Carnival is bigger and more profitible than RCI right now, that eventually their habit of almost never building anything really new is going to turn around and bit them. People could start to get bored with their product and start going to other lines like RCI or NCL. In a hundred years RCI and NCL will be offering cruises to the moon while Carnival will be introducing the new 180,000gtr 5th generation Destiny class ships.

I don't understand why Oasis charging a premium price, as compared to Dream or other ships in RCI's fleet, is a surprise to anyone. Oasis cost way more then any other cruise ship ever has! Of course she will be more expensive at first. Also compared with the Carnival Dream, Oasis offers a unique cruise experience whereas the Dream does not. Not even the other ships in RCI's fleet can offer the same experience as Oasis. It seems to me that this would naturally make her more expensive.

[ 11-17-2009: Message edited by: Cunard Fan ]

I must say I am worried that Oasis isn't even close to being full (first few cruises) with all of that media attention, I thought at least the Inaugural and pre - inaugurals would be at least close to capacity.

I think Oasis has helped and hurt RCI. It has helped them get more media attention and lure some customers into the cruising industry. But its has hurt them in respects to their bottom line, and has forced them to cut costs in the quality of food, and service etc. across the fleet; and Oasis & Allure has forced RCI to get a loan to pay those big boys off so they don't go broke trying to outdo themselves.

I wish Oasis all the best sucess.

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Originally posted by eroller:

On this point I agree, for now. None the less a lot can happen in ten years, and that is pretty much the cycle of new designs from RCI. This was pretty much the case with VOYAGER OF THE SEAS and imagine the same will hold true for OASIS.

Ernie

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Ernie,

I agree with you on all points. And now I am scared that we are agreeing.

In regards to Cahill's remarks, they were made in response to questions he was asked by financial analysts and institutional investors. This was more of a financial update than a broad-based media conference where these questions are very common.

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Originally posted by Tim in 'Lauderdale:

Ernie,

I agree with you on all points. And now I am scared that we are agreeing.

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Tim,
We have agreed in the past ... on occasion.

Just remember, no bowling alley!

nobody cared, you would think with the dreams fancy new lazer light show they would have had that firing to attract attention, no fireboats (at least that i saw any pictures of) shooting colored water
no nothing

and the fun force, what the hell was that all about? reminder me of a pack of chiuauas (taco bell dogs)
jumping around the stage (LAME)

then there was the whole dedication ceremony
basicly held in the dark, no spotlights, no fireworks
again another prime opportunity to run the lazers
nada zippo

and to read johns blog well i guess new yorkers just are not that impressed with a giant fake bottle of champeign (SP) come to think of it neither am i.

combine that with the rough sailings and yea in my opnion carnival pretty much blew the dreams introduction to new york

and i can say i am both a guest and stockholder of carnival

Ernie I am not suggesting they take bottom feeder prices - but if I had just spent over a $1 billion on the biggest cruise ship ever built with all the press etc it has had and with all the "firsts" she enjoys and then discovered that even the Maiden Voyage was far from sold out then I would be concerned.

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Originally posted by mike sa:
Oasis Maiden Cruise - 4 days, plenty of space - $650 per person. Through local travel agent who rang RCI US for a fare. Bear in mind the travel agent gets 20%. She was told tickets are also available for the christening.

Ernie I am not suggesting they take bottom feeder prices - but if I had just spent over a $1 billion on the biggest cruise ship ever built with all the press etc it has had and with all the "firsts" she enjoys and then discovered that even the Maiden Voyage was far from sold out then I would be concerned.

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The discounting is in the way of onboard credits. It seems RCI is damned if you do and damned if you don't. Don't discount and obtain very high yields and people complain the ship is not full. Offer some discounts and people complain Oasis should not have to be discounted.

Anyway I get the feeling if the ship was sold out at bottom feeder pricing you would be complaining about that, because the yields were not higher. As I pointed out earlier, Carnival Dream (and many new ships of various lines) are not selling out right now. This time of year is historically slow, with the most amount of discounting going on, and we happen to be in the midst of a historical global recession. I do understand it would be great if Oasis were sold out on every cruise, but I don't think it's alarming she isn't given the circumstances and the high yields she has received on cabins that are sold. Almost every sailing through the end of 1010 has all suites sold out, and they were sold at extremely high yields. I would be more concerned if Oasis were offering $349 7-day cruises and still was not filling up. This *is* the case with many ships right now, but they are not getting the attention.

Anyway, perhaps Oasis will be a huge failure and bankrupt Royal Caribbean and send CCL stock through the roof? Does that sound more appealing to you? I'm often surprised at all the negativity surrounding Oasis before the ship even departs on it's first cruise. It's much too earlier to tell if Oasis will be a success or failure. The ship has to be in service a few years, and in a more stable economy to truly determine the popularity of this class of ship, and the long-term yields she will be able to sustain. Unfortunately I believe there are people that want this ship to fail. Personally I'm willing to give the ship a chance.

Ernie

[ 11-18-2009: Message edited by: eroller ]

And I don't think anyone is being specifically negative about her either, I just find it amazing that even without discounting it is not sold out especially as it is only $650 - for the maiden voyage of the biggest ever and likely to be the biggest for a goodly number of years to come. And whether it is an on board discount or fare discount it is still a discount, you can't accuse one line of bottom feeding and then say another isn't when it is. If they had said we are deliberately not sailing full for a few cruises in order to test systems and train staff that MIGHT be believable, but inventory management is pure and simple BS, by the way the $650 was a central park balcony so I assume inside would be cheaper still (it took the travel agent about an hour to understand the concept of a central park balcony cabin on a SHIP! He had never heard of Oasis never mind what she has on board).

I will no doubt absolutely be booking on her the next time I am going to be in the US, it is (at present) the newest show in town and I bet I'll love it - as long as I stick to the alternative restaurants each night, but that applies to most other mainstream lines as well.

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Originally posted by mike sa:
I just find it amazing that even without discounting it is not sold out especially as it is only $650 - for the maiden voyage of the biggest ever and likely to be the biggest for a goodly number of years to come.

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The December 1 sailing was added after the fact, when it was discovered the ship would be finished early. Also remember the December 1 sailing is only a 4 day cruise and it departs on a Tuesday. It's not like a weekend sailing and frankly people don't have the time off, or don't want to take an entire week off for a 4-day sailing, and it's expensive. I would be there if I could but I don't have the time off. The holidays are coming up and that takes up valuable time off. Remember in the US we don't get a whole lot of vacation time. Also, the lowest price you can possibly book this sailing right now in the US is $995.98 per person including tax. That is for a category CV. Personally think that is far from any kind of bottom feeder pricing and it's rather expensive. It would be considered a decent yield for a 7-day cruise, let alone a 4-day cruise.

I understand your reasons for concern, but I feel it's really premature at this point. Frankly RCI could not have introduced this ship at a worse time. Had they known the state of the economy would be the way it is today when the ship was first ordered, things would probably be different.

In a few years we will be able to better determine the success or failure of the Oasis Class ships.

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Originally posted by mike sa:
I doubt there is anyone even at Carnival who wants Oasis to fail, if it did it would not be good for their business either.

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On this point I agree 100%. I think it would be a huge setback for the Cruise Industry as a whole if Oasis failed.