Oceania Rewards Alaska with Capacity; Other Lines Not So Quick to Respond

Following on the heels of Alaska’s move to reduce its head tax for cruise passengers, Oceania Cruises has announced its first ever Alaska season, set for summer 2011.

“We are thrilled to add the 49th state to our growing slate of itineraries,” said Frank Del Rio, Oceania’s founder and chairman/CEO of parent company Prestige Cruise Holdings. “We would like to thank Alaska’s Governor, Sean Parnell, and the Alaska Legislature for their efforts to roll back the head tax on cruise passengers, which was an important consideration in evaluating our deployment alternatives.” (See article for details on Oceania’s Alaska season.)

Two other cruise lines have announced new Alaska capacity, as well, though both Disney Cruise Line and Crystal Cruises did so before the Alaskan government reduced the cruise passenger head tax.

As it is for Oceania, Alaska is a brand-new destination for Disney, which will sail the Disney Wonder on 18 seven-night Alaskan cruises from Vancouver in the summer of 2011.
 
Crystal Cruises will return to Alaska in 2011 after a six-year absence.

However, other than Oceania’s announcement, no cruise lines have made any changes to their 2011 scheduled Alaska deployments.

“It’s too early to say how this change will impact us or the selling process,” said a spokesperson for Crystal Cruises.

“Our plans for Alaska are already set for 2011 and the sailings are open for sale, so we are not planning any deployment changes,” said a Carnival Cruise Line spokesperson. “We haven’t completed our summer 2012 deployment plans at this time. We hope that the reduction in the Alaska tax will have a positive impact on cruise pricing and improve profitability for our Alaska deployment.”

Despite the fact that the 2012 Carnival deployment is still in the works, capacity for Alaska is unlikely to change. The cruise line has historically only had one ship in Alaska since it started sailing there in 1997 – and one ship is already scheduled for this year and next.

Holland America Line also seems unlikely to alter its 2011 Alaska capacity, despite the reduced head tax, though 2012 is still open to an increase.

“Holland America Line will be looking carefully at its 2012 and beyond itineraries in light of this news, and I feel certain the rest of the industry will be doing so, too,” said Stein Kruse, president and CEO of Holland America Line, who said the passage of the head tax reduction bill signals the “beginning of a better and more positive relationship between the cruise industry and Alaska’s leadership.”

However, he was quick to point out that the head tax was only one of several central concerns the cruise industry has with Alaska.

“We look forward to working with them to also address the separate but related issues we have raised, such as excessive regulations, that hold the cruise industry to environmental standards higher than those of any land-based facility,” Kruse said.

Princess Cruises is also maintaining a wait-and-see stance.

“The tax reduction, plus the governor’s and legislature’s increase in marketing dollars will certainly help begin to improve demand, not only for those choosing between Alaska and other destinations, but also for those who might now have the budget to stay longer or buy a cruise/tour, vs. the shorter trips,” a Princess spokesperson said.

“Everything that reduces the ultimate cost to the consumer increases demand and spending more money selling Alaska, which is a fantastic vacation option, also improves demand.”

However, she added: “How much the two together will push the needle is impossible to gauge.”

Yet when asked by Travel Market Report whether they believed the reduced head tax would precipitate Alaska demand among their clients, travel agents didn’t think so.

“I have not seen any trend change at all since the rollback of the Alaska head tax,” said Ralph Santisteban of Miami CruiseOne. “There are few consumers who have even realized the rollback has occurred. Many consumers were never informed of the tax itself when it was imposed. Unless there is some type of media blitz instigated by the cruise lines, I do not anticipate any change in Alaska cruise trends.”

Marge Suazo of Cruise Planners – Maximum Cruise and Tour in Colorado agreed. “It hasnt seemed to stimulate inquiries. My Alaska bookings are minimal this year but I might have a ‘close in’ surge as this info gets more attention.”

However, she added: “I don’t personally think it will make much of a difference from the clients’ perspective.”

Rusty Pickett, ECC, of Shellback Cruises put it more plainly. The passenger head tax, he said, is “way beyond what consumers care about.”

Celebrity Cruises declined to comment on their future Alaska capacity, and Norwegian Cruise Line did not respond to Travel Market Report’s request.