1 00:00:00,000 --> 00:00:01,940 Welcome to Cruise News, your daily 2 00:00:01,940 --> 00:00:03,680 update on everything happening at 3 00:00:03,680 --> 00:00:06,099 sea. Visit cruisenews .io to see 4 00:00:06,099 --> 00:00:07,780 today's stories and sign up for 5 00:00:07,780 --> 00:00:11,560 email alerts. So, imagine you're 6 00:00:11,560 --> 00:00:13,240 standing on the deck of just your 7 00:00:13,240 --> 00:00:15,220 absolute dream Alaskan cruise, right? 8 00:00:15,240 --> 00:00:17,420 Oh, yeah. The classic bucket list 9 00:00:17,420 --> 00:00:18,879 trick. Exactly. You've got a coffee 10 00:00:18,879 --> 00:00:20,839 in hand, you're surrounded by these 11 00:00:20,839 --> 00:00:22,440 massive ancient granite cliffs, 12 00:00:22,460 --> 00:00:24,539 and you are just waiting to see 13 00:00:24,539 --> 00:00:26,640 a glacier calve. Right. But then 14 00:00:26,640 --> 00:00:28,629 suddenly... Millions of tons of 15 00:00:28,629 --> 00:00:30,269 that granite just completely collapse 16 00:00:30,269 --> 00:00:32,409 into the water. Oh wow. Yeah, creating 17 00:00:32,409 --> 00:00:34,590 this localized tsunami heading straight 18 00:00:34,590 --> 00:00:36,659 for your ship. I mean, it is a terrifying 19 00:00:36,659 --> 00:00:39,179 scenario. And frankly, it's a scenario 20 00:00:39,179 --> 00:00:40,659 the cruise industry is suddenly 21 00:00:40,659 --> 00:00:42,140 having to take very, very seriously 22 00:00:42,140 --> 00:00:44,200 right now. Because we often think 23 00:00:44,200 --> 00:00:46,020 of cruising as buying a ticket to 24 00:00:46,020 --> 00:00:47,880 this static, completely predictable 25 00:00:47,880 --> 00:00:49,560 experience. Right. You pay your 26 00:00:49,560 --> 00:00:50,719 fare, you get on the ship, and you 27 00:00:50,719 --> 00:00:52,780 see the sights. Exactly. But the 28 00:00:52,780 --> 00:00:54,299 reality is that the product you 29 00:00:54,299 --> 00:00:56,280 are buying is constantly being bent, 30 00:00:56,399 --> 00:00:59,780 molded, and sometimes entirely derailed 31 00:00:59,780 --> 00:01:01,579 by forces far beyond the cruise 32 00:01:01,579 --> 00:01:03,329 director's control. Which is really 33 00:01:03,329 --> 00:01:04,950 what we're focusing on today. We're 34 00:01:04,950 --> 00:01:06,030 looking at our reporting through 35 00:01:06,030 --> 00:01:08,030 this very specific editorial lens. 36 00:01:08,390 --> 00:01:11,310 We are exploring how massive, uncontrollable 37 00:01:11,310 --> 00:01:13,609 outside forces are actively dictating, 38 00:01:14,129 --> 00:01:15,549 like, where you go, what you pay, 39 00:01:15,590 --> 00:01:17,069 and how you experience your time 40 00:01:17,069 --> 00:01:19,250 at sea. We're looking at the sheer 41 00:01:19,250 --> 00:01:21,709 physical forces of nature, global 42 00:01:21,709 --> 00:01:24,209 economic shifts, and honestly, the 43 00:01:24,209 --> 00:01:25,709 psychological marketing playbooks 44 00:01:25,709 --> 00:01:27,090 that the industry is using to keep 45 00:01:27,090 --> 00:01:28,769 you on board through it all. It's 46 00:01:28,769 --> 00:01:30,269 a lot of ground to cover. It really 47 00:01:30,269 --> 00:01:31,890 is. So we're starting with some 48 00:01:31,879 --> 00:01:34,659 major 2026 rewrites in Alaska caused 49 00:01:34,659 --> 00:01:36,680 by shifting geology. Then we're 50 00:01:36,680 --> 00:01:38,500 moving to how the Middle East conflict 51 00:01:38,500 --> 00:01:40,420 is directly threatening your wallet. 52 00:01:40,659 --> 00:01:43,040 And finally, how a new Oscars ad 53 00:01:43,040 --> 00:01:45,439 campaign reveals the emotional playbook 54 00:01:45,439 --> 00:01:46,780 lines are using to keep you loyal. 55 00:01:47,719 --> 00:01:49,739 So let's start with nature. Let's 56 00:01:49,739 --> 00:01:51,900 do it. And I mean the undeniable 57 00:01:51,900 --> 00:01:54,120 physical environment forcing operators 58 00:01:54,120 --> 00:01:55,599 to literally alter the products 59 00:01:55,599 --> 00:01:57,260 they sell to you. Like if you are 60 00:01:57,260 --> 00:01:58,859 booked on a Holland America or a 61 00:01:58,859 --> 00:02:00,680 Carnival cruise to Alaska from the 62 00:02:00,680 --> 00:02:02,879 spring through September of 2026. 63 00:02:03,689 --> 00:02:05,310 your itinerary is changing. It's 64 00:02:05,310 --> 00:02:07,030 just gone. Yeah, both lines are 65 00:02:07,030 --> 00:02:08,990 entirely dropping Tracy Armfjord 66 00:02:08,990 --> 00:02:10,550 from their schedules. And we need 67 00:02:10,550 --> 00:02:12,189 to be really clear about the magnitude 68 00:02:12,189 --> 00:02:15,030 of this. This isn't just like a 69 00:02:15,030 --> 00:02:16,530 minor scheduling tweet because a 70 00:02:16,530 --> 00:02:17,949 port was too crowded. Right, yeah. 71 00:02:18,150 --> 00:02:21,289 This is a fundamental shift in where 72 00:02:21,289 --> 00:02:23,370 it is physically safe to put a mega 73 00:02:23,370 --> 00:02:25,759 ship. Yep. And the root cause goes 74 00:02:25,759 --> 00:02:28,819 back to a major landslide that occurred 75 00:02:28,819 --> 00:02:31,520 back in August of 2025. Near the 76 00:02:31,520 --> 00:02:33,000 South Sawyer Glacier, right. Exactly. 77 00:02:33,099 --> 00:02:34,460 Let's actually break down what happened 78 00:02:34,460 --> 00:02:35,780 there, because the reporting shows 79 00:02:35,780 --> 00:02:37,939 that the collapse sent just millions 80 00:02:37,939 --> 00:02:40,020 of cubic feet of rock and debris 81 00:02:40,020 --> 00:02:42,379 crashing into the water. Yeah. And 82 00:02:42,379 --> 00:02:43,740 because a fjord is essentially, 83 00:02:43,780 --> 00:02:45,560 well, it's a narrow, high -walled 84 00:02:45,560 --> 00:02:47,500 bathtub. That's a great way to describe 85 00:02:47,500 --> 00:02:49,180 it, right. So that displacement 86 00:02:49,180 --> 00:02:51,719 of water generated a localized tsunami 87 00:02:51,719 --> 00:02:53,259 right there inside the waterway. 88 00:02:53,680 --> 00:02:55,900 why the US Geological Survey has 89 00:02:55,900 --> 00:02:57,860 been heavily monitoring this area 90 00:02:57,860 --> 00:03:00,479 and honestly issuing some pretty 91 00:03:00,479 --> 00:03:02,819 severe warnings. Wow. Because to 92 00:03:02,819 --> 00:03:04,159 understand why this is happening 93 00:03:04,159 --> 00:03:06,120 now, you really have to understand 94 00:03:06,120 --> 00:03:07,879 the physical mechanics of a fjord. 95 00:03:08,039 --> 00:03:09,659 Okay, walk us through that. So you 96 00:03:09,659 --> 00:03:12,300 have these incredibly steep granite 97 00:03:12,300 --> 00:03:15,020 walls, right? Mm -hmm. And for millennia, 98 00:03:15,120 --> 00:03:18,620 those rock faces have been structurally 99 00:03:18,620 --> 00:03:21,180 supported by massive, densely packed 100 00:03:21,180 --> 00:03:23,479 ice. Like the glacier itself. Exactly. 101 00:03:23,580 --> 00:03:25,539 The glacier acts almost like a brace 102 00:03:25,539 --> 00:03:27,520 against the wall. Oh, I see. But 103 00:03:27,520 --> 00:03:29,360 as those glaciers retreat and melt 104 00:03:29,360 --> 00:03:31,300 due to warming temperatures, those 105 00:03:31,300 --> 00:03:32,919 vertical rock faces are suddenly 106 00:03:32,919 --> 00:03:34,750 left completely unsupported. they 107 00:03:34,750 --> 00:03:36,610 lose that brace. Right. They lose 108 00:03:36,610 --> 00:03:37,889 that structural bracing, which makes 109 00:03:37,889 --> 00:03:39,849 them incredibly prone to catastrophic 110 00:03:39,849 --> 00:03:41,490 failure. So it's basically like 111 00:03:41,490 --> 00:03:43,030 pulling the mortar out of a brick 112 00:03:43,030 --> 00:03:44,370 wall and just hoping the bricks 113 00:03:44,370 --> 00:03:46,090 stay stacked. That is exactly it. 114 00:03:46,330 --> 00:03:49,069 Wow. So you literally have millions 115 00:03:49,069 --> 00:03:51,150 of tons of rock suddenly free falling 116 00:03:51,150 --> 00:03:53,520 into a confined body of water. I 117 00:03:53,520 --> 00:03:54,919 mean, I completely understand why 118 00:03:54,919 --> 00:03:55,900 you wouldn't want a cruise ship 119 00:03:55,900 --> 00:03:57,479 anywhere near that. No, not at all. 120 00:03:57,560 --> 00:04:00,280 This feels like a massive highway 121 00:04:00,280 --> 00:04:02,360 rock slide permanently altering 122 00:04:02,360 --> 00:04:03,719 your favorite summer road trip. 123 00:04:03,759 --> 00:04:06,439 But I have to ask you, is this August 124 00:04:06,439 --> 00:04:09,340 2025 landslide just a one -off stroke 125 00:04:09,340 --> 00:04:11,639 of bad luck? Or are the cruise lines 126 00:04:11,639 --> 00:04:14,060 reading this USGS data and realizing 127 00:04:14,060 --> 00:04:15,900 that chasing ice in narrow fjords 128 00:04:15,900 --> 00:04:18,040 is fundamentally just too risky 129 00:04:18,040 --> 00:04:19,819 in an era of melting landscapes? 130 00:04:20,259 --> 00:04:21,720 I mean, the operational reality 131 00:04:21,720 --> 00:04:23,769 points heavily toward Really? Oh, 132 00:04:23,850 --> 00:04:25,350 yeah. It is fundamentally about 133 00:04:25,350 --> 00:04:27,750 risk management and liability. You 134 00:04:27,750 --> 00:04:29,750 simply cannot afford the liability 135 00:04:29,750 --> 00:04:31,589 of navigating a vessel carrying 136 00:04:31,589 --> 00:04:34,290 over 2 ,000 passengers into a narrow, 137 00:04:34,389 --> 00:04:36,910 confined waterway that has a documented, 138 00:04:37,230 --> 00:04:38,730 scientifically verified tsunami 139 00:04:38,730 --> 00:04:40,230 risk. Yeah, that makes sense. Think 140 00:04:40,230 --> 00:04:41,709 about the core product the cruise 141 00:04:41,709 --> 00:04:43,610 industry actually sells. It relies 142 00:04:43,610 --> 00:04:45,430 heavily on creating an illusion 143 00:04:45,430 --> 00:04:46,769 for the passenger. The illusion 144 00:04:46,769 --> 00:04:48,730 of the wild. Exactly. The illusion 145 00:04:48,730 --> 00:04:50,850 of untamed wilderness and rugged 146 00:04:50,850 --> 00:04:52,579 exploration. but delivered with 147 00:04:52,579 --> 00:04:54,180 the safety, predictability, and 148 00:04:54,180 --> 00:04:55,980 comfort of a luxury hotel. Right, 149 00:04:56,060 --> 00:04:57,360 you want the danger behind the glass. 150 00:04:57,600 --> 00:04:58,779 Exactly. So when the wilderness 151 00:04:58,779 --> 00:05:01,079 actually becomes untamed and genuinely 152 00:05:01,079 --> 00:05:03,000 unpredictable, the operators have 153 00:05:03,000 --> 00:05:05,040 to seamlessly swap natural assets 154 00:05:05,040 --> 00:05:06,800 to keep that illusion intact. Which 155 00:05:06,800 --> 00:05:08,899 brings us to the substitute. Because 156 00:05:08,899 --> 00:05:11,220 for both Holland America and Carnival, 157 00:05:11,639 --> 00:05:13,259 the ships will essentially turn 158 00:05:13,259 --> 00:05:15,100 toward Endicott Arm to view the 159 00:05:15,100 --> 00:05:17,699 Dawes Glacier instead. And this 160 00:05:17,699 --> 00:05:20,060 impacts a huge swath of the fleet. 161 00:05:20,300 --> 00:05:21,920 We are talking about Holland America's 162 00:05:21,920 --> 00:05:24,560 Conings Dam, Nordum, Zondam, and 163 00:05:24,560 --> 00:05:26,160 Eurodam. That's a lot of ships. 164 00:05:26,339 --> 00:05:28,620 It is. And for Carnival, it's the 165 00:05:28,620 --> 00:05:31,620 spirit, luminosa, and miracle. Holland 166 00:05:31,620 --> 00:05:34,019 America is actually extending their 167 00:05:34,019 --> 00:05:36,019 Endicott Arm scenic cruising day 168 00:05:36,019 --> 00:05:37,720 to eight and a half hours to try 169 00:05:37,579 --> 00:05:39,579 and compensate for the change? Well, 170 00:05:39,680 --> 00:05:41,439 an Endicott arm offers a much safer, 171 00:05:41,620 --> 00:05:44,040 yet very comparable, fjord and glacier 172 00:05:44,040 --> 00:05:45,879 experience. OK, so it still looks 173 00:05:45,879 --> 00:05:47,759 the part. Oh, yeah. It's a spectacular 174 00:05:47,759 --> 00:05:49,720 waterway, but structurally, it just 175 00:05:49,720 --> 00:05:51,839 gives the ship's wider, safer navigational 176 00:05:51,839 --> 00:05:53,439 margins. Ah, I see. It allows the 177 00:05:53,439 --> 00:05:55,180 cruise lines to maintain that Alaskan 178 00:05:55,180 --> 00:05:56,519 glacier illusion for the consumer. 179 00:05:56,860 --> 00:05:58,839 but without the existential threat 180 00:05:58,839 --> 00:06:00,959 of an unsupported granite wall just 181 00:06:00,959 --> 00:06:03,120 collapsing on the deck. Right. So 182 00:06:03,120 --> 00:06:04,399 if cruise lines are completely at 183 00:06:04,399 --> 00:06:06,000 the mercy of unpredictable geology 184 00:06:06,000 --> 00:06:07,259 in Alaska when it comes to where 185 00:06:07,259 --> 00:06:09,420 ships sail, they are equally at 186 00:06:09,420 --> 00:06:10,819 the mercy of global economics when 187 00:06:10,819 --> 00:06:12,339 it comes to how much it costs to 188 00:06:12,339 --> 00:06:14,060 actually sail them. Oh, absolutely. 189 00:06:14,160 --> 00:06:15,800 So let's move from the physical 190 00:06:15,800 --> 00:06:17,740 danger of the landscape to the financial 191 00:06:17,740 --> 00:06:19,860 danger of the global oil market. 192 00:06:19,939 --> 00:06:21,779 This is a critical development for 193 00:06:21,779 --> 00:06:23,240 the industry's bottom line right 194 00:06:23,240 --> 00:06:25,180 now. Yeah. Because right now Brent 195 00:06:25,180 --> 00:06:28,600 crude has spiked over $100 a barrel. 196 00:06:28,819 --> 00:06:31,720 Wow. That is a massive 35 % jump. 197 00:06:32,319 --> 00:06:34,899 35%. That is huge. It really is. 198 00:06:34,899 --> 00:06:36,839 Yeah. And this is directly tied 199 00:06:36,839 --> 00:06:39,040 to supply worries stemming from 200 00:06:39,040 --> 00:06:40,459 the Middle East conflict involving 201 00:06:40,459 --> 00:06:42,699 Iran. Well, I need to stop you there 202 00:06:42,699 --> 00:06:44,839 because I am genuinely confused 203 00:06:44,839 --> 00:06:46,459 by how some of these massive cruise 204 00:06:46,459 --> 00:06:48,000 corporations are handling this. 205 00:06:48,379 --> 00:06:49,740 Okay, how so? Well, I'm looking 206 00:06:49,740 --> 00:06:51,600 at Carnival Corporation specifically. 207 00:06:51,720 --> 00:06:53,759 Ah, right. The reporting says Carnival 208 00:06:53,759 --> 00:06:55,899 is uniquely exposed right now because, 209 00:06:56,060 --> 00:06:57,459 unlike their major competitors, 210 00:06:58,079 --> 00:07:00,079 they do not financially hedge their 211 00:07:00,079 --> 00:07:02,579 fuel prices. If fuel hedging is 212 00:07:02,579 --> 00:07:04,540 basically an insurance policy against 213 00:07:04,540 --> 00:07:07,019 catastrophic price spikes, why would 214 00:07:07,019 --> 00:07:08,720 a multi -billion dollar company 215 00:07:08,720 --> 00:07:10,600 like Carnival ever choose to just 216 00:07:10,600 --> 00:07:12,600 go uninsured? Are they just gambling? 217 00:07:12,459 --> 00:07:15,779 It's a great question. And to really 218 00:07:15,779 --> 00:07:17,339 understand it, we have to look at 219 00:07:17,339 --> 00:07:19,259 their overarching corporate philosophy. 220 00:07:19,720 --> 00:07:22,339 Okay. So fuel hedging is a financial 221 00:07:22,339 --> 00:07:24,959 contract that cruise lines or airlines 222 00:07:24,959 --> 00:07:27,800 buy to lock in a specific price 223 00:07:27,800 --> 00:07:29,439 for a portion of their future fuel 224 00:07:29,439 --> 00:07:31,459 consumption. Right. Royal Caribbean, 225 00:07:31,500 --> 00:07:33,319 for example, has hedged over half 226 00:07:33,319 --> 00:07:36,220 of its fuel needs for 2026. Okay. 227 00:07:36,480 --> 00:07:39,500 Norwegian does it too. But those 228 00:07:39,500 --> 00:07:40,920 financial contracts aren't free. 229 00:07:41,050 --> 00:07:42,470 You pay a premium for them. Sure, 230 00:07:42,629 --> 00:07:44,370 like an insurance premium. Exactly. 231 00:07:45,230 --> 00:07:46,769 Carnival's historical philosophy 232 00:07:46,769 --> 00:07:48,949 is that paying those premiums is 233 00:07:48,949 --> 00:07:50,850 a waste of capital if oil prices 234 00:07:50,850 --> 00:07:52,970 stay flat or drop. Oh, interesting. 235 00:07:53,290 --> 00:07:54,829 Yeah. They believe their massive 236 00:07:54,829 --> 00:07:56,910 scale allows them to absorb fluctuations, 237 00:07:57,009 --> 00:07:58,889 and they prefer to invest that capital 238 00:07:58,889 --> 00:08:01,009 into physical ship efficiency rather 239 00:08:01,009 --> 00:08:02,750 than financial derivatives on Wall 240 00:08:02,750 --> 00:08:04,579 Street. But the math on that strategy 241 00:08:04,579 --> 00:08:06,480 looks incredibly painful right now. 242 00:08:06,620 --> 00:08:08,100 It does. According to their own 243 00:08:08,100 --> 00:08:10,779 company filings, a mere 10 % change 244 00:08:10,779 --> 00:08:12,860 in fuel costs per metric ton would 245 00:08:12,860 --> 00:08:16,759 wipe out $145 million of Carnival's 246 00:08:16,759 --> 00:08:20,100 2026 net income. Ouch. Right. Compare 247 00:08:20,100 --> 00:08:21,399 that to Royal Caribbean, where the 248 00:08:21,399 --> 00:08:23,100 same 10 % change only hits them 249 00:08:23,100 --> 00:08:25,620 for $57 million. Wow, yeah. Or Norwegian, 250 00:08:26,079 --> 00:08:27,720 which takes about a $90 million 251 00:08:27,720 --> 00:08:31,290 hit. Carnival is way out there. 252 00:08:31,529 --> 00:08:33,250 And we saw the vulnerability of 253 00:08:33,250 --> 00:08:35,570 this exact philosophy play out recently 254 00:08:35,570 --> 00:08:38,730 during the 2022 oil spike. Oh, right. 255 00:08:38,870 --> 00:08:40,629 I remember that. Carnival's fuel 256 00:08:40,629 --> 00:08:43,389 costs ate up nearly 18 % of their 257 00:08:43,389 --> 00:08:46,029 total revenue that year. 18%. Yeah. 258 00:08:46,250 --> 00:08:48,009 For Royal Caribbean, because they 259 00:08:48,009 --> 00:08:49,590 had that insurance policy in place, 260 00:08:49,950 --> 00:08:52,169 it was only 12%. So Carnival's primary 261 00:08:52,169 --> 00:08:53,409 defense here is that they focus 262 00:08:53,409 --> 00:08:55,429 entirely on efficiency. Right. They've 263 00:08:55,429 --> 00:08:57,509 stated they have cut fuel use by 264 00:08:57,509 --> 00:09:00,149 18 percent since 2011, which, to 265 00:09:00,149 --> 00:09:02,409 be fair, is an impressive engineering 266 00:09:02,409 --> 00:09:04,669 feat. It really is. Especially considering 267 00:09:04,669 --> 00:09:06,169 their passenger capacity grew by 268 00:09:06,169 --> 00:09:08,049 more than 38 percent in that same 269 00:09:08,049 --> 00:09:09,269 time. Right. They're moving way 270 00:09:09,269 --> 00:09:11,330 more people for less fuel. But to 271 00:09:11,330 --> 00:09:13,090 me, this sounds exactly like refusing 272 00:09:13,090 --> 00:09:14,669 to lock in a fixed mortgage rate 273 00:09:14,669 --> 00:09:16,009 right before inflation hits just 274 00:09:16,009 --> 00:09:17,210 because you bought energy -efficient 275 00:09:17,210 --> 00:09:18,990 light bulbs. That is a perfect analogy. 276 00:09:19,549 --> 00:09:21,370 I mean, it's impressive that Carnival 277 00:09:21,370 --> 00:09:23,289 cut usage by 18 percent. But if 278 00:09:23,289 --> 00:09:25,570 Iran's warning of $200 a barrel 279 00:09:25,570 --> 00:09:27,529 oil comes true, isn't efficiency 280 00:09:27,529 --> 00:09:29,490 just like using a bucket to bail 281 00:09:29,490 --> 00:09:31,330 out a flooded engine room? That 282 00:09:31,330 --> 00:09:33,049 is exactly the way to look at it. 283 00:09:33,049 --> 00:09:34,769 Because no matter how fast Carnival 284 00:09:34,769 --> 00:09:36,929 bails water with their 18 percent 285 00:09:36,929 --> 00:09:40,190 efficiency gains, a massive geopolitical 286 00:09:40,190 --> 00:09:42,129 oil spike is a tidal wave. Yeah. 287 00:09:42,429 --> 00:09:44,009 It completely swamps the bucket. 288 00:09:44,389 --> 00:09:46,210 They are optimizing speeds, adjusting 289 00:09:46,210 --> 00:09:48,289 itineraries, using new hull coatings. 290 00:09:48,519 --> 00:09:51,419 But when global shocks hit, efficiency 291 00:09:51,419 --> 00:09:53,179 only buffers a fraction of the blow. 292 00:09:53,340 --> 00:09:54,620 Which brings us to the listener's 293 00:09:54,620 --> 00:09:56,340 wallet. Yes. Because if you're sitting 294 00:09:56,340 --> 00:09:57,820 at home right now looking at a $3 295 00:09:57,820 --> 00:10:00,620 ,000 summer cruise to Europe, you're 296 00:10:00,620 --> 00:10:02,000 probably wondering, am I going to 297 00:10:02,000 --> 00:10:04,080 get slapped with a surprise daily 298 00:10:04,080 --> 00:10:05,879 fuel bill the week before I sail? 299 00:10:06,820 --> 00:10:09,019 So when do you think the major US 300 00:10:09,019 --> 00:10:10,820 lines will actually pass those daily 301 00:10:10,820 --> 00:10:12,980 surcharges onto the consumer? That 302 00:10:12,980 --> 00:10:14,639 is the multimillion dollar dilemma 303 00:10:14,639 --> 00:10:16,470 in the boardrooms right now. I bet. 304 00:10:16,649 --> 00:10:17,870 What we are really talking about 305 00:10:17,870 --> 00:10:19,750 here is pricing power. Currently, 306 00:10:20,110 --> 00:10:21,929 the major US lines are operating 307 00:10:21,929 --> 00:10:23,909 from a position of incredible strength. 308 00:10:24,669 --> 00:10:26,470 Royal Caribbean is forecasting record 309 00:10:26,470 --> 00:10:28,490 -breaking earnings per share, and 310 00:10:28,490 --> 00:10:31,370 they are operating at a 109 % load 311 00:10:31,370 --> 00:10:35,549 factor. Wow! 109%. And their ships 312 00:10:35,549 --> 00:10:38,029 are completely full. Yeah. And because 313 00:10:38,029 --> 00:10:40,779 of that incredible momentum, operators 314 00:10:40,779 --> 00:10:43,179 are absolutely terrified of killing 315 00:10:43,179 --> 00:10:45,460 the golden goose by suddenly implementing 316 00:10:45,460 --> 00:10:47,120 a surcharge. Especially because 317 00:10:47,120 --> 00:10:49,000 this oil spike is hitting right 318 00:10:49,000 --> 00:10:50,720 in the middle of wave season. Right. 319 00:10:50,860 --> 00:10:52,600 Like from January through March, 320 00:10:53,139 --> 00:10:54,779 that is the critical window when 321 00:10:54,779 --> 00:10:57,100 cruise lines lock in a huge chunk 322 00:10:57,100 --> 00:10:58,519 of their bookings for the entire 323 00:10:58,519 --> 00:11:00,590 year. Precisely. To answer your 324 00:11:00,590 --> 00:11:01,690 question, they're going to hold 325 00:11:01,690 --> 00:11:03,370 off as long as humanly possible 326 00:11:03,370 --> 00:11:04,970 in the US market. Really? Oh, yeah. 327 00:11:05,429 --> 00:11:07,450 Now, US passenger contracts absolutely 328 00:11:07,450 --> 00:11:09,230 allow them to do it. Right. Norwegian 329 00:11:09,230 --> 00:11:11,269 can charge up to $10 a day per guest, 330 00:11:11,870 --> 00:11:13,190 and Royal Caribbean can charge up 331 00:11:13,190 --> 00:11:15,870 to $12 a day if oil passes certain 332 00:11:15,870 --> 00:11:17,389 thresholds. OK, so the mechanism 333 00:11:17,389 --> 00:11:19,809 is there. It's there. Yeah. But 334 00:11:19,809 --> 00:11:21,509 invoking that during wave season 335 00:11:21,509 --> 00:11:23,970 is a massive psychological buzzkill 336 00:11:23,970 --> 00:11:25,789 for consumers who are already sensitive 337 00:11:25,789 --> 00:11:27,309 to being nickel -and -dimed. Oh, 338 00:11:27,309 --> 00:11:29,409 for sure. However, in the Asian 339 00:11:29,409 --> 00:11:30,850 markets, lines have already pulled 340 00:11:30,850 --> 00:11:33,409 the trigger. They have. Yeah. Passengers 341 00:11:33,409 --> 00:11:35,529 on the Genting Dream are now paying 342 00:11:35,529 --> 00:11:38,250 a surcharge of 15 Singapore dollars 343 00:11:38,250 --> 00:11:41,450 a day. Wow. Star Voyager and Star 344 00:11:41,450 --> 00:11:43,389 Navigator are charging up to 200 345 00:11:43,389 --> 00:11:46,250 Hong Kong dollars and 600 new Taiwan 346 00:11:46,250 --> 00:11:49,169 dollars per night. That sets a dangerous 347 00:11:49,169 --> 00:11:50,950 precedent, honestly. It really does. 348 00:11:51,350 --> 00:11:52,889 Even without the surcharges active 349 00:11:52,889 --> 00:11:55,230 in the US yet, analysts are warning 350 00:11:55,230 --> 00:11:56,889 that the geopolitical uncertainty 351 00:11:56,889 --> 00:11:59,330 alone is threatening bookings. If 352 00:11:59,330 --> 00:12:01,149 you are an American looking at a 353 00:12:01,149 --> 00:12:03,529 higher -priced European or transatlantic 354 00:12:03,529 --> 00:12:05,809 summer itinerary, you are already 355 00:12:05,809 --> 00:12:07,129 hesitating because of the flight 356 00:12:07,129 --> 00:12:09,950 costs and just global tension. Adding 357 00:12:09,950 --> 00:12:11,870 a daily fuel surcharge on top of 358 00:12:11,870 --> 00:12:13,629 that could completely stall booking 359 00:12:13,629 --> 00:12:15,129 momentum for those third quarter 360 00:12:15,129 --> 00:12:16,990 sailings. Which is huge. Exactly. 361 00:12:17,409 --> 00:12:19,110 Those contribute disproportionately 362 00:12:19,110 --> 00:12:20,490 to the cruise line's bottom line. 363 00:12:20,909 --> 00:12:22,289 So it's a delicate balancing act. 364 00:12:22,769 --> 00:12:25,269 They need to cover the skyrocketing 365 00:12:25,269 --> 00:12:27,210 cost of moving the ship, but they 366 00:12:27,210 --> 00:12:29,330 simply cannot afford to break the 367 00:12:29,330 --> 00:12:30,929 consumer's enthusiasm for getting 368 00:12:30,929 --> 00:12:33,470 on board. So if cruise lines are 369 00:12:33,470 --> 00:12:36,149 completely at the mercy of unpredictable 370 00:12:36,149 --> 00:12:38,970 geology in Alaska, and volatile 371 00:12:38,970 --> 00:12:40,830 oil markets in the Middle East, 372 00:12:41,289 --> 00:12:43,470 what can they control? That's the 373 00:12:43,470 --> 00:12:44,610 million -dollar question. If the 374 00:12:44,610 --> 00:12:46,850 outside world is this chaotic and 375 00:12:46,850 --> 00:12:48,889 this expensive, the answer has to 376 00:12:48,889 --> 00:12:51,110 be what's happening inside the passenger's 377 00:12:51,110 --> 00:12:53,269 head. You have to sell the ship 378 00:12:53,269 --> 00:12:55,950 as a timeless emotional sanctuary. 379 00:12:56,159 --> 00:12:57,860 And when it comes to controlling 380 00:12:57,860 --> 00:12:59,340 the psychological environment and 381 00:12:59,340 --> 00:13:01,340 marketing the intangible, honestly, 382 00:13:01,460 --> 00:13:02,700 no one does it quite like Disney. 383 00:13:02,899 --> 00:13:04,639 Oh, totally. We saw this perfectly 384 00:13:04,639 --> 00:13:06,879 executed during the March 15th Academy 385 00:13:06,879 --> 00:13:09,019 Awards broadcast. Yes, we did. Disney 386 00:13:09,019 --> 00:13:11,059 Cruise Land debuted a high profile 387 00:13:11,059 --> 00:13:12,879 new ad campaign called Midnight 388 00:13:12,879 --> 00:13:15,259 Magic. It was this massive prime 389 00:13:15,259 --> 00:13:17,779 time national launch. And the ad 390 00:13:17,779 --> 00:13:19,120 itself is fascinating because of 391 00:13:19,120 --> 00:13:21,139 what it doesn't show. It follows 392 00:13:21,139 --> 00:13:23,139 a father and son taking a quiet 393 00:13:23,139 --> 00:13:24,580 late night walk on the deck of the 394 00:13:24,580 --> 00:13:26,100 Disney charger. The ship is empty. 395 00:13:26,220 --> 00:13:28,059 People have gone to bed. It's very 396 00:13:28,059 --> 00:13:30,179 peaceful. Very. And the ad just 397 00:13:30,179 --> 00:13:32,759 revisits this exact same simple 398 00:13:32,759 --> 00:13:34,220 routine as the child grows into 399 00:13:34,220 --> 00:13:35,399 an adult and eventually becomes 400 00:13:35,399 --> 00:13:37,480 a parent himself walking the deck 401 00:13:37,480 --> 00:13:38,960 with his own. child. And they set 402 00:13:38,960 --> 00:13:41,039 the entire sequence to the married 403 00:13:41,039 --> 00:13:42,620 life theme from Pixar's Up. Which 404 00:13:42,620 --> 00:13:44,639 is basically a weaponized audio 405 00:13:44,639 --> 00:13:46,360 trigger for tears. Oh, absolutely. 406 00:13:46,399 --> 00:13:47,740 It gets you every time. It does. 407 00:13:48,000 --> 00:13:49,799 But what is truly notable here is 408 00:13:49,799 --> 00:13:51,679 the commentary from Denny's chief 409 00:13:51,679 --> 00:13:53,899 marketing officer, Asad Ayaz. Right. 410 00:13:54,139 --> 00:13:56,419 He explicitly stated that this campaign 411 00:13:56,419 --> 00:13:59,179 intentionally de -emphasizes spectacle. 412 00:13:59,940 --> 00:14:01,860 The focus is entirely on the quieter 413 00:14:01,860 --> 00:14:03,820 moments that build real connection. 414 00:14:04,340 --> 00:14:05,980 It's not about showing off a massive 415 00:14:05,980 --> 00:14:07,879 new water slide or a Broadway -style 416 00:14:07,879 --> 00:14:10,500 show. It's treating the multi -billion 417 00:14:10,500 --> 00:14:12,480 dollar ship as a quiet backdrop 418 00:14:12,480 --> 00:14:14,419 for a recurring emotional ritual. 419 00:14:14,580 --> 00:14:15,960 And what's fascinating here is the 420 00:14:15,960 --> 00:14:17,840 broader context of why they're doing 421 00:14:17,840 --> 00:14:20,360 this right now. Okay, why? This 422 00:14:20,360 --> 00:14:22,289 heavy emotional play. is happening 423 00:14:22,289 --> 00:14:24,370 exactly as Disney is aggressively 424 00:14:24,370 --> 00:14:27,009 expanding its fleet. They're aiming 425 00:14:27,009 --> 00:14:30,190 to operate 13 ships by 2031. Wow, 426 00:14:30,409 --> 00:14:33,029 13. Yeah. They just launched the 427 00:14:33,029 --> 00:14:35,330 Disney Destiny from Florida in October 428 00:14:35,330 --> 00:14:38,250 of 2025. Right. And they are preparing 429 00:14:38,250 --> 00:14:40,250 to christen the Disney adventure 430 00:14:40,250 --> 00:14:43,539 in Singapore. in March of 2026. 431 00:14:43,840 --> 00:14:45,059 Which is a whole new market for 432 00:14:45,059 --> 00:14:46,940 them. Exactly. It opens up an entirely 433 00:14:46,940 --> 00:14:48,379 new market in Southeast Asia. Yeah. 434 00:14:48,480 --> 00:14:49,919 So they have a massive amount of 435 00:14:49,919 --> 00:14:52,139 new, expensive capacity that they 436 00:14:52,139 --> 00:14:53,639 need to fill year round. So they 437 00:14:53,639 --> 00:14:55,779 are essentially selling the quiet 438 00:14:55,779 --> 00:14:57,600 campfire instead of the million 439 00:14:57,600 --> 00:14:59,600 dollar fireworks show. That's a 440 00:14:59,600 --> 00:15:00,919 great way to put it. But here's 441 00:15:00,919 --> 00:15:02,759 what I'm wondering. With Disney 442 00:15:02,759 --> 00:15:05,620 expanding to 13 ships by 2031 and 443 00:15:05,620 --> 00:15:07,519 moving into these entirely new international 444 00:15:07,519 --> 00:15:10,429 markets, Is this pivot to nostalgia 445 00:15:10,429 --> 00:15:12,850 and quiet moments actually a calculated 446 00:15:12,850 --> 00:15:14,970 necessity? Like, are they realizing 447 00:15:14,970 --> 00:15:17,409 that you simply cannot win a purely 448 00:15:17,409 --> 00:15:19,490 amenity arms race against other 449 00:15:19,490 --> 00:15:21,669 mega ships forever? That is the 450 00:15:21,669 --> 00:15:23,370 exact trap they're avoiding. It 451 00:15:23,370 --> 00:15:25,129 is a brilliant strategy, and yes, 452 00:15:25,129 --> 00:15:26,690 it's a calculated necessity. If 453 00:15:26,690 --> 00:15:27,950 you look at the broader industry, 454 00:15:28,289 --> 00:15:29,809 other lines are constantly battling 455 00:15:29,809 --> 00:15:31,490 over who has the tallest roller 456 00:15:31,490 --> 00:15:33,570 coaster at sea, or the biggest water 457 00:15:33,570 --> 00:15:35,070 park, or the longest go -kart track. 458 00:15:35,590 --> 00:15:37,889 But physical amenities depreciate. 459 00:15:37,840 --> 00:15:39,539 A new ship comes out next year with 460 00:15:39,539 --> 00:15:41,879 a slightly bigger slide, and suddenly 461 00:15:41,879 --> 00:15:43,620 your multi -million -dollar spectacle 462 00:15:43,620 --> 00:15:46,419 is obsolete. Yeah. The novelty inevitably 463 00:15:46,419 --> 00:15:47,759 wears off. Once you've ridden the 464 00:15:47,759 --> 00:15:49,039 coaster once, it doesn't have the 465 00:15:49,039 --> 00:15:50,620 same draw five years later. Exactly. 466 00:15:51,120 --> 00:15:52,779 But Disney is marketing a feeling. 467 00:15:53,919 --> 00:15:55,659 And feelings, particularly nostalgia, 468 00:15:56,179 --> 00:15:58,480 are immune to physical depreciation. 469 00:15:59,179 --> 00:16:00,879 Establishing a multi -generational 470 00:16:00,879 --> 00:16:02,559 family tradition like a midnight 471 00:16:02,559 --> 00:16:05,220 walk on the deck creates the ultimate 472 00:16:05,220 --> 00:16:07,509 competitive moat. Oh, I see. If 473 00:16:07,509 --> 00:16:09,450 a family associates your brand with 474 00:16:09,450 --> 00:16:11,190 their core formative memories of 475 00:16:11,190 --> 00:16:12,909 growing up, they aren't going to 476 00:16:12,909 --> 00:16:14,549 jump ship to a competitor just because 477 00:16:14,549 --> 00:16:16,070 the competitor has a slightly better 478 00:16:16,070 --> 00:16:18,250 buffet or a new surf simulator. 479 00:16:18,450 --> 00:16:19,870 Right, the loyalty is locked in. 480 00:16:20,129 --> 00:16:22,370 Exactly. That generational loyalty 481 00:16:22,370 --> 00:16:24,250 guarantees repeat cruisers across 482 00:16:24,250 --> 00:16:26,340 decades. Wow. When you are trying 483 00:16:26,340 --> 00:16:28,940 to fill 13 massive ships worldwide, 484 00:16:29,659 --> 00:16:31,039 regardless of whether oil is at 485 00:16:31,039 --> 00:16:33,379 $100 a barrel or a glacier is retreating 486 00:16:33,379 --> 00:16:35,960 in Alaska, you need that bulletproof 487 00:16:35,960 --> 00:16:38,340 emotional loyalty to justify your 488 00:16:38,340 --> 00:16:40,179 premium pricing. Because it physically 489 00:16:40,179 --> 00:16:41,740 alters the consumer's valuation 490 00:16:41,740 --> 00:16:44,100 of the trip. Yes, exactly. You aren't 491 00:16:44,100 --> 00:16:46,879 paying $3 ,000 for transportation 492 00:16:46,879 --> 00:16:49,720 and a buffet. You're paying $3 ,000 493 00:16:49,720 --> 00:16:51,840 to preserve a family tradition. 494 00:16:51,840 --> 00:16:54,259 Right. Which perfectly ties together 495 00:16:54,259 --> 00:16:56,279 the massive outside forces we've 496 00:16:56,279 --> 00:16:58,019 been tracking today. It really does. 497 00:16:58,279 --> 00:17:00,179 You have nature permanently altering 498 00:17:00,179 --> 00:17:01,659 the physical destinations we can 499 00:17:01,659 --> 00:17:03,879 actually visit, forcing ships to 500 00:17:03,879 --> 00:17:05,619 find new glaciers to maintain the 501 00:17:05,619 --> 00:17:08,400 illusion. You have global oil markets. 502 00:17:08,460 --> 00:17:10,440 making the simple act of moving 503 00:17:10,440 --> 00:17:12,619 the ship from port to port increasingly 504 00:17:12,619 --> 00:17:14,799 expensive, threatening corporate 505 00:17:14,799 --> 00:17:17,119 profits and consumer wallets. And 506 00:17:17,119 --> 00:17:19,400 in response, you have cruise lines 507 00:17:19,400 --> 00:17:21,339 doubling down on the psychological 508 00:17:21,339 --> 00:17:23,160 and emotional experiences that happen 509 00:17:23,160 --> 00:17:25,619 entirely on the ship. The industry 510 00:17:25,619 --> 00:17:27,180 is basically adapting by making 511 00:17:27,180 --> 00:17:29,460 the vessel itself the irreplaceable 512 00:17:29,460 --> 00:17:31,359 destination. Which brings me to 513 00:17:31,359 --> 00:17:32,660 a final thought for you to ponder 514 00:17:32,660 --> 00:17:34,779 today. If the destinations become 515 00:17:34,779 --> 00:17:36,720 too geologically dangerous to reach 516 00:17:36,720 --> 00:17:38,900 and the fuel becomes too prohibitively 517 00:17:38,900 --> 00:17:41,119 expensive to burn, how long until 518 00:17:41,119 --> 00:17:43,099 the mega ships stop sailing altogether? 519 00:17:43,319 --> 00:17:45,220 Wow. Are we moving toward an era 520 00:17:45,220 --> 00:17:47,140 where cruising simply means boarding 521 00:17:47,140 --> 00:17:48,819 a permanently anchored floating 522 00:17:48,819 --> 00:17:50,599 coastal resort? Will the future 523 00:17:50,599 --> 00:17:51,980 of the cruise industry eventually 524 00:17:51,980 --> 00:17:54,000 mean never actually leaving the 525 00:17:54,000 --> 00:17:56,190 dock? That is a fascinating question. 526 00:17:56,490 --> 00:17:57,730 Thanks for listening to Cruise News. 527 00:17:58,089 --> 00:18:00,029 Visit CruiseNews .io to catch up 528 00:18:00,029 --> 00:18:01,529 on the latest updates and sign up 529 00:18:01,529 --> 00:18:02,650 for free email alerts.