Pride of Aloha all pau- leaving Hawaii

Pride of Aloha to leave the fleet in May   
HONOLULU – February 11, 2008 –NCL Corporation (“NCL”) today announced the withdrawal of Pride of Aloha from the Hawai‘i market effective May 11, 2008. The ship is being transferred to Star Cruises and will be re-flagged and deployed in Asia in the summer of 2008.

The remaining year-round ship in Hawai‘i will be the larger and newer Pride of America, introduced in 2005, a vessel specifically designed and built for Hawai’i cruising. The company announced, and put on sale, Pride of America’s sailings through 2010 offering its popular inter-island cruises departing every Saturday from Honolulu.

Since the announcement a year ago of Pride of Hawai‘i’s temporary transfer to NCL’s European deployment, renamed as Norwegian Jade, the company has embarked on a major fleet-wide initiative called Freestyle 2.0 featuring significant product and hardware upgrades to its modern fleet, including Pride of America. The Freestyle 2.0 program will further enhance the on-board experience taking Freestyle Cruising to the next level. Enhancements include a major investment in the total dining experience; upgrading the stateroom experience; new wide ranging on-board activities for all guests; additional recognition, service and amenities for balcony, suite and villa guests; and the establishment of casual action-station restaurants taking the place of the “traditional” buffet experience.  Freestyle 2.0 will be in place on Pride of America and across NCL’s fleet, now the youngest fleet in the cruise industry, by the middle of May 2008.

“Pride of Aloha pioneered the new inter-island market but, as we move forward with Freestyle 2.0 to take our product to the next level across what is already the youngest fleet in the industry, we cannot justify further investment in this ship,” said Andy Stuart, NCL’s executive vice president of marketing, sales and passenger services. “Withdrawing Pride of Aloha was an extremely difficult but necessary commercial decision; however we see a strong future for the long-term flagship in Hawai‘i, Pride of America. In Pride of America, we have created a commercially successful modern U.S. Flag cruise ship home ported in Hawai‘i - the first time that has ever been achieved. With Pride of America, we are offering a high quality product, on a world class ship sailing one of the most exciting itineraries available in the industry.

“With today’s announcement of Pride of America’s itinerary through 2010, our guests and travel partners can choose a Freestyle Cruising vacation on a big, modern ship visiting all four main islands and featuring more time to explore ashore than any other cruise line sailing in Hawai‘i. In the longer term, as demand continues to grow for this premium experience, we hope to bring back our other modern purpose-built U.S.-flag ship, Pride of Hawai‘i.”

Guests booked on Pride of Aloha

For guests booked on Pride of Aloha from May 11, 2008 and beyond, NCL is holding space and will offer the same cruise fare as they currently have paid on their Pride of Aloha cruise if they would like to transfer to the same week on Pride of America, departing one day earlier. In addition:

•    Guests will receive a $100 per person on-board credit (up to $200 per stateroom).

•    For guests who made their air and/or hotel arrangements through NCL, NCL will protect the rates they currently have paid and cover any air or hotel change fees.

•    For guests who purchased their own air, NCL will protect up to the first $100 per person of any increase in air costs and cover up to $75 per person in air change fees.

•    For guests who made independent hotel arrangements, NCL will cover any hotel change fees up to $25 per person.

Guests may book any other NCL cruise and receive a $100 per person on-board credit (up to $200 per stateroom) if they rebook by March 7, 2008. In addition, NCL will cover up to $75 per person in air change fees and up to $25 per person in hotel change fees.

Guests may cancel their cruise and receive a full refund if NCL is notified by March 7, 2008. In addition, NCL will cover up to $75 per person in air change fees and up to $25 per person in hotel change fees. After March 7, 2008 cancellation fees will apply in accordance with NCL’s cancellation policy.

Pride of America’s deployment announced through 2010

Following a 14-day scheduled dry dock in Hawai‘i from April 26, 2008 to May 10, 2008, Pride of America will sail its four main island itinerary with a change in order of ports including an overnight in Nawiliwili, Kaua‘i; an afternoon cruise of the breathtaking Napali Coast; Hilo,
Hawai‘i; an evening sail by Mount Kilauea; Kona, Hawai‘i; and an overnight in Kahului, Maui. All of the Freestyle 2.0 enhancements will be rolled out on Pride of America during the ship’s dry-dock.

Launched in 2005, Pride of America has over 660 balcony staterooms, the broadest range of family-friendly interconnecting cabins available at sea, a choice of nine different restaurants and 12 dining options, multiple entertainment venues, three pools, extensive children’s facilities, an abundance of spacious public rooms, and the largest dedicated meeting facilities at sea. All inspired by the diverse regions of America.

Cabotage Issues

Commenting on the Pride of Aloha withdrawal, NCL’s President and CEO Colin Veitch said: “Our Hawai‘i business has been extraordinarily difficult, and although we have progressively established a stable operation, delivering a good product in a great destination, the overall price level in the market has been driven down, to a significant degree, by an unprecedented expansion of capacity from low-cost foreign flag ships based on the west coast operating domestic Hawai‘i itineraries that the Customs Service has indicated are legally the preserve of U.S. flag ships.

“We have invested heavily in U.S. flag cruising in reliance on our nation’s cabotage laws providing a level playing field in Hawai‘i. Our remaining ship, Pride of America, is generating an encouraging profit now, and we project a continued improvement in this one-ship operation as the unique nature of Hawai‘i, from a cabotage standpoint, is clarified and restored. In due course, we would then expect, and hope, to be able to grow our U.S. flag business back to two profitable ships by reintroducing Pride of Hawai‘i.”

1 comment February 11th, 2008

Proposed Cruise Bill Could Lead to Stormy Seas for Hawaii

Having worked in the yachting industry for two years, I wanted to learn more about the proposed federal rule stipulating that foreign flagged vessels must stop in a foreign port for a minimum of 48 hours before entering a U.S. port.

How could this impact Hawaii’s cruise market? The proposed rule claims it was designed to help U.S. flagged ships operated by NCL America on their Hawaii cruises be more competitive with foreign-flagged cruise lines sailing from California. The change is an extended length of stay required by foreign flagged vessels, increased to a 48-hour stay instead of the previous 4 to 12 hours.

The irony of the new rule is that now due to the increased 2-day stay, foreign ships may have to alter their itinerary to comply – skipping Hawaii completely. Since Hawaii is the most isolated island chain in the world, it takes time to get here from the west coast.  Now with the new rule, there simply may not be enough time for foreign vessels to comply with the ruling and make it to Hawaii. Governor Lingle has come out against the bill as cited in the Honolulu Advertiser, “If foreign vessels drop Hawaii, it could cost the state $200 million annually and eliminate more than 1,400 jobs.”

U.S. flagged ships are built and registered in the United States and hire only U.S. citizens. The business conducted on the vessel must concur to U.S. law and employment regulations. Therefore the costs of running a U.S. flagged vessel are higher than a foreign flagged vessel. Foreign flagged ships are registered outside the United States and therefore avoid the stricter U.S. labor, health, tax, safety and environmental laws.

Where did this new rule come from? It is called the “Passenger Vessel Services Act”, a federal law that forbids foreign-flagged vessels from transporting passengers directly between U.S. ports. It is the Customs and Border Protection Agency’s new interpretation of the 122-year-old law.  It directly targets rival foreign-flagged ships based in Los Angeles and San Diego that stop briefly in Ensenada, Mexico en-route to Hawaiian waters.

Other port locations likely to be left off foreign ship’s itineraries are Juneau, Alaska, Portland, Maine and Key West, Florida. Many elected officials and tourism professionals have criticized the rule claiming it could drive ships away from U.S. ports and force them to drop shorter trips. As one of the world’s top cruise destinations, Juneau could lose an estimated $68 million in direct spending in one summer as ships are forced to spend more time in British Columbia.

As it stands now, NCL America hasn’t backed down from its position that something needs to be done to protect it’s U.S. flagged Hawaii ships. Alan Yamamoto, V. P. of Hawaii Operations for NCL America, stated in the Star Bulletin that, “NCL America’s U.S. flagged ships are at a competitive disadvantage because they are subject to U.S. taxes and labor laws.” Yamamoto went on the further state, “We have invested $1.3 billion in the fleet. Since 2004 the company has lost more than $250 million, principally due to lower cost foreign competition from the West Coast.”

While the final rule could be adopted anytime, it appears that customs officials are re-thinking their approach, “We do not want to turn the entire cruise industry upside down,” stated Glen Vereb, Customs Chief, in the Advertiser. With the largely negative reaction to the bill, it will be interesting to see how the Customs and Border Protection Agency navigates the bumpy waters ahead.

posted by Cara M. 2/11/08

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1 comment February 11th, 2008

NFL’s Touchdown for Hawaii Youth

Another Pro Bowl goes down in the books. Sunday’s game had some high scores and luckily sunshine! As the event operations people start the breakdown of the stadium and the mainland visitors board their flights home, the people of Oahu will still have the presence of the NFL.

Last Thursday the NFL and Boys & Girls Clubs of Hawaii broke ground in Nanakuli for a new youth center. In their long tradition of charity and community building, the NFL’s Youth Education Town initiative is committed to educational and recreational centers for children in at-risk. Typically they select neighborhoods in Super Bowl host cities, however Honolulu was chosen since it has hosted the Pro Bowl for over twenty years.

The 10,000-square-foot center is expected to open in 2009. It will target Hawaii kids ages 7 to 17 on Oahu and Kauai. It will include an outdoor amphitheater, Native Hawaiian garden, multimedia studio, teen center, community room and a learning center. As stated in the Pacific Business News, the center received a $1 million donation from the NFL and will be funded through private and public contributions from the state, city and corporations. We look forward to the opening of the facility as well as next year’s Pro Bowl right here in Hawaii. (Posted by CM - photo courtesy HNA)

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