Two years ago NCL, Norwegian Cruise Line, pulled three of its four ships out of Hawaii citing problems with their competition and lack of profitability. At that time it was a big blow to the tourism industry here and came as a big surprise because the Pride of Hawaii, a brand-new ship wasn’t even in service for an entire year before it got the 86. Part of the problem was management. Weekly cruises around the Hawaiian Islands was something that hadn’t been tried here for many years. As a result, it got off to a very rocky start with lots of consumer complaints. Many of the complaints centered around issues about the ships work force, which by law, must be American only. Many felt that Americans could not do as good a job at customer service as the foreign flagged ships. Competition from other cruise lines started to get squeezed out by NCL and so a lot of the rhetoric and negativity towards NCL escalated because they were getting too much share of the Hawaii cruise markeplace. While NCL learned a lot in its first year or so of doing cruises in Hawaii and made drastic improvements month over month, however, first impressions are everything and unfortunately the stigma and bad press associated with those first cruises stuck with consumers for a long time. Combine that with all of the other factors and it’s easy to see why NCL had a rough go trying to manage four ships in Hawaiian waters.
As a Hawaii-based travel company, having the ships here was very profitable. During the time that three ships were sailing in Hawaiian waters our company did very well. Having the ships here was great for the consumer too because they were more choices. At one point there were even two and three days sail itineraries available and also departures from Maui.
Fast-forward to today; NCL just announced that their Hawaii 7 day Cruise around the islands netted $67 million dollars in profit in 2009 compared to a $212 million loss the previous year. The cruise was so successful that it turned a healthy profit in one of the worst economies in decades. The company attributes its success to better management practices in higher price points.
When NCL pulled out the Pride of America and the Pride of Aloha in 2008, they made a commitment to keep the pride of America in Hawaiian waters at least through 2011. They also announced that they would consider bringing back the pride of Hawaii at a lateter date, holding open the possibility of a return to more cruise ships here in Hawaii.
Could we see a return of one of the NCL’s ships in the near future? It certainly may be a possibility. The economy is turning around people are traveling again and the cruise is really very popular. We are seeing sold-out situations for many of the dates through May which means that demand is high. On the other hand, with all of the negative experience NCL had in Hawaii they may just be content to keep things as they are and try to control inventories and max out the price.
Obviously I would love to see the return of one of the NCL ships to Hawaiian waters, especially the Pride of Hawaii which was built for Hawaii and had more balconies on it than any of the other ships sailing here. While it’s probably not likely to happen this year I think that NCL will probably be looking at their bottom-line to see if feasible to bring another ship to Hawaii for 2011.
It might be time for government officials to look at ways to provide incentives to NCL to bring another ship back to Hawaii. Hawaii has not had the best climate for new business ventures in recent years and NCL did not think they were getting the support they needed from Hawaii’s government officials when they removed all but one ship from Hawaii. Leaders should look at making our ports more friendly and provide tax credits and incentives for creating new jobs here in the islands to intice NCL (or others who want to sail here) to come back or bring new ships to the islands.
One thing is for sure Hawaii tourism is on the rebound and if you’re thinking about booking the one Hawaii ship we do have here you should do it well in advance. Our agents are standing by right now to help you give us a call at 1-800-843-8771.
Posted by: Bruce Fisher