Second Round of Discounting Coming?

The industry is concerned that a second round of deep discounting may break this fall. At the moment, the fall season is lining up to be as tough or tougher than last year's.

According to Carnival Cruise Lines, a new wave of cruise discounts are being brought into the market. As a result, Carnival has announced that it will raise cruise fares seven to nine percent effective November 1, 1992.

Carnival had previously announced that it was maintaining current (1992) pricing levels through 1993. "Unfortunately, since then, some of our competitors already have discounted the entire year," Bob Dickinson, Senior Vice President of Sales and Marketing, said.

While Dickinson said that the company felt extremely positive about its current pricing, it "could not ignore the continuing deep discount phenomena." Presumably, increased fares will give Carnival the opportunity to offer deeper discounts while maintaining yields.

Carnival has also announced a two-for-one fall promotion on three- and four-day cruises aboard the Carnivale and Mardis Gras, sailing from Port Canaveral. This promotion follows a special $400 fall savings program on four-day cruises on the Carnivale and Mardis Gras, announced in late May.

Carnival has previously also announced special fall rates on seven-day cruises from August through mid-December, offering savings of $400 to $700 per cabin, including round-trip airfare.

Carnival has not said what company or companies Dickinson is referring to, but Royal Caribbean Cruise Line recently extended its Breakthrough Rates program through the end of 1993.

Breakthrough Rates

Breakthrough Rates were introduced earlier this year by RCCL. The program offers discounts up to 30 percent to passengers who book cruises the farthest in advance of departure. Rates increase closer to sailing date thus encouraging passengers to book early.

The Breakthrough Rates program has two cruise-only base rates for each cruise, one for outside cabins and one for inside cabins. The price level is determined by sailing date. Upgrades from the base category are available for $10 per category on three- and four-night cruises; $15 per category on seven-day and 10- and 11-day sailings; and $25 in Europe and on Panama Canal sailings. Larger and deluxe cabins are not included. Air transportation is available for an add-on price.

According to RCCL, a Breakthrough Rate is the lowest price available for any sailing, eliminating the need for agents to re-check prices for the "best deal ."

Travel agents have told this newsletter that they welcome the program and use it extensively. Some also said that as they get closer to sailing dates, they switch to group space. Thus, some are able to offer passengers the maximum or near maximum discounts practically up to the sailing date.

More Discounts

While the market is supposed to be improving, there are travel agents who advertise cruise savings up to 50 percent off brochure rates.

More commonly, however, other agents offer 50 percent off the second passenger, on selected sailings, on American Hawaii, Carnival, Celebrity Cruises, Costa Cruise Line, Fantasy Cruises, and Princess Cruises.

The American Automobile Association (AAA) offers its members discounts on several cruise lines including 25 to 41 percent off seven- or 10-day Caribbean cruises with Holland America Line from Tampa this fall.

Celebrity Cruises is advertising 50 percent off for the second person in a stateroom, based on double occupancy. The offer is for selected sailings only and is capacity controlled.

Club Med has announced that the Club Med will begin its fourth winter season in the Caribbean at rates that are lower this fall and winter than they were last year.

In a prepared statement, Michael Kubin, President of Club Med Sales, said that "the lower price structure reflects the situation in today's marketplace. Customers are more price sensitive than ever this year." Seven-day cruises range from $1,750 to $2,150 per person, double occupancy, compared to $1,750 to $2,690 last year.

Round-trip air to Martinique is available from New York ranging from $500 to $550, and from Miami, ranging from $400 to $450. Add-on air packages are also available from 60 cities throughout the U.S. 

Cunard Lines has introduced group discounts up to 30 percent for seven-day cruises aboard the Cunard Countess this fall and winter, including holiday sailings.

Dolphin Cruise Line offers seven-night cruises from Aruba starting at $795 including roundtrip air.

Premier Cruise Lines has extended the booking deadline for its seven-day Summer Family Value Vacation to September 15 for cruises through December 18, 1992.

Regency Cruises is advertising that the second person in the cabin cruises for free on its new 10- and 11-day Caribbean cruises aboard the Regent Sun in November and early December.

RCCL is advertising seven-day cruises aboard the Sovereign of the Seas from $844 to $3,180 including air for selected fall sailings. Windstar Cruises has announced two programs: a travel agents Savings Update program, effective fleet-wide in all destinati ons for the remainder of 1992 sailings on all booking made by August 31, 1992; and a 1993 Early Booking Savings Program.

According to Windstar, the purpose of the Savings Update program is to provide agents an advance simplified schedule of discount rates ranging from 25 to 50 percent, offering the greatest savings up front.

The 1993 Early Booking Savings Program offers up to 30 percent savings per person off tariff. The savings rate depends on the number of days ahead of departure the booking is made.

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