Welcome to Cruise News, your daily
update on everything happening at
sea. Visit cruisenews .io to see
today's stories and sign up for
email alerts. So, imagine you're
standing on the deck of just your
absolute dream Alaskan cruise, right?
Oh, yeah. The classic bucket list
trick. Exactly. You've got a coffee
in hand, you're surrounded by these
massive ancient granite cliffs,
and you are just waiting to see
a glacier calve. Right. But then
suddenly... Millions of tons of
that granite just completely collapse
into the water. Oh wow. Yeah, creating
this localized tsunami heading straight
for your ship. I mean, it is a terrifying
scenario. And frankly, it's a scenario
the cruise industry is suddenly
having to take very, very seriously
right now. Because we often think
of cruising as buying a ticket to
this static, completely predictable
experience. Right. You pay your
fare, you get on the ship, and you
see the sights. Exactly. But the
reality is that the product you
are buying is constantly being bent,
molded, and sometimes entirely derailed
by forces far beyond the cruise
director's control. Which is really
what we're focusing on today. We're
looking at our reporting through
this very specific editorial lens.
We are exploring how massive, uncontrollable
outside forces are actively dictating,
like, where you go, what you pay,
and how you experience your time
at sea. We're looking at the sheer
physical forces of nature, global
economic shifts, and honestly, the
psychological marketing playbooks
that the industry is using to keep
you on board through it all. It's
a lot of ground to cover. It really
is. So we're starting with some
major 2026 rewrites in Alaska caused
by shifting geology. Then we're
moving to how the Middle East conflict
is directly threatening your wallet.
And finally, how a new Oscars ad
campaign reveals the emotional playbook
lines are using to keep you loyal.
So let's start with nature. Let's
do it. And I mean the undeniable
physical environment forcing operators
to literally alter the products
they sell to you. Like if you are
booked on a Holland America or a
Carnival cruise to Alaska from the
spring through September of 2026.
your itinerary is changing. It's
just gone. Yeah, both lines are
entirely dropping Tracy Armfjord
from their schedules. And we need
to be really clear about the magnitude
of this. This isn't just like a
minor scheduling tweet because a
port was too crowded. Right, yeah.
This is a fundamental shift in where
it is physically safe to put a mega
ship. Yep. And the root cause goes
back to a major landslide that occurred
back in August of 2025. Near the
South Sawyer Glacier, right. Exactly.
Let's actually break down what happened
there, because the reporting shows
that the collapse sent just millions
of cubic feet of rock and debris
crashing into the water. Yeah. And
because a fjord is essentially,
well, it's a narrow, high -walled
bathtub. That's a great way to describe
it, right. So that displacement
of water generated a localized tsunami
right there inside the waterway.
why the US Geological Survey has
been heavily monitoring this area
and honestly issuing some pretty
severe warnings. Wow. Because to
understand why this is happening
now, you really have to understand
the physical mechanics of a fjord.
Okay, walk us through that. So you
have these incredibly steep granite
walls, right? Mm -hmm. And for millennia,
those rock faces have been structurally
supported by massive, densely packed
ice. Like the glacier itself. Exactly.
The glacier acts almost like a brace
against the wall. Oh, I see. But
as those glaciers retreat and melt
due to warming temperatures, those
vertical rock faces are suddenly
left completely unsupported. they
lose that brace. Right. They lose
that structural bracing, which makes
them incredibly prone to catastrophic
failure. So it's basically like
pulling the mortar out of a brick
wall and just hoping the bricks
stay stacked. That is exactly it.
Wow. So you literally have millions
of tons of rock suddenly free falling
into a confined body of water. I
mean, I completely understand why
you wouldn't want a cruise ship
anywhere near that. No, not at all.
This feels like a massive highway
rock slide permanently altering
your favorite summer road trip.
But I have to ask you, is this August
2025 landslide just a one -off stroke
of bad luck? Or are the cruise lines
reading this USGS data and realizing
that chasing ice in narrow fjords
is fundamentally just too risky
in an era of melting landscapes?
I mean, the operational reality
points heavily toward Really? Oh,
yeah. It is fundamentally about
risk management and liability. You
simply cannot afford the liability
of navigating a vessel carrying
over 2 ,000 passengers into a narrow,
confined waterway that has a documented,
scientifically verified tsunami
risk. Yeah, that makes sense. Think
about the core product the cruise
industry actually sells. It relies
heavily on creating an illusion
for the passenger. The illusion
of the wild. Exactly. The illusion
of untamed wilderness and rugged
exploration. but delivered with
the safety, predictability, and
comfort of a luxury hotel. Right,
you want the danger behind the glass.
Exactly. So when the wilderness
actually becomes untamed and genuinely
unpredictable, the operators have
to seamlessly swap natural assets
to keep that illusion intact. Which
brings us to the substitute. Because
for both Holland America and Carnival,
the ships will essentially turn
toward Endicott Arm to view the
Dawes Glacier instead. And this
impacts a huge swath of the fleet.
We are talking about Holland America's
Conings Dam, Nordum, Zondam, and
Eurodam. That's a lot of ships.
It is. And for Carnival, it's the
spirit, luminosa, and miracle. Holland
America is actually extending their
Endicott Arm scenic cruising day
to eight and a half hours to try
and compensate for the change? Well,
an Endicott arm offers a much safer,
yet very comparable, fjord and glacier
experience. OK, so it still looks
the part. Oh, yeah. It's a spectacular
waterway, but structurally, it just
gives the ship's wider, safer navigational
margins. Ah, I see. It allows the
cruise lines to maintain that Alaskan
glacier illusion for the consumer.
but without the existential threat
of an unsupported granite wall just
collapsing on the deck. Right. So
if cruise lines are completely at
the mercy of unpredictable geology
in Alaska when it comes to where
ships sail, they are equally at
the mercy of global economics when
it comes to how much it costs to
actually sail them. Oh, absolutely.
So let's move from the physical
danger of the landscape to the financial
danger of the global oil market.
This is a critical development for
the industry's bottom line right
now. Yeah. Because right now Brent
crude has spiked over $100 a barrel.
Wow. That is a massive 35 % jump.
35%. That is huge. It really is.
Yeah. And this is directly tied
to supply worries stemming from
the Middle East conflict involving
Iran. Well, I need to stop you there
because I am genuinely confused
by how some of these massive cruise
corporations are handling this.
Okay, how so? Well, I'm looking
at Carnival Corporation specifically.
Ah, right. The reporting says Carnival
is uniquely exposed right now because,
unlike their major competitors,
they do not financially hedge their
fuel prices. If fuel hedging is
basically an insurance policy against
catastrophic price spikes, why would
a multi -billion dollar company
like Carnival ever choose to just
go uninsured? Are they just gambling?
It's a great question. And to really
understand it, we have to look at
their overarching corporate philosophy.
Okay. So fuel hedging is a financial
contract that cruise lines or airlines
buy to lock in a specific price
for a portion of their future fuel
consumption. Right. Royal Caribbean,
for example, has hedged over half
of its fuel needs for 2026. Okay.
Norwegian does it too. But those
financial contracts aren't free.
You pay a premium for them. Sure,
like an insurance premium. Exactly.
Carnival's historical philosophy
is that paying those premiums is
a waste of capital if oil prices
stay flat or drop. Oh, interesting.
Yeah. They believe their massive
scale allows them to absorb fluctuations,
and they prefer to invest that capital
into physical ship efficiency rather
than financial derivatives on Wall
Street. But the math on that strategy
looks incredibly painful right now.
It does. According to their own
company filings, a mere 10 % change
in fuel costs per metric ton would
wipe out $145 million of Carnival's
2026 net income. Ouch. Right. Compare
that to Royal Caribbean, where the
same 10 % change only hits them
for $57 million. Wow, yeah. Or Norwegian,
which takes about a $90 million
hit. Carnival is way out there.
And we saw the vulnerability of
this exact philosophy play out recently
during the 2022 oil spike. Oh, right.
I remember that. Carnival's fuel
costs ate up nearly 18 % of their
total revenue that year. 18%. Yeah.
For Royal Caribbean, because they
had that insurance policy in place,
it was only 12%. So Carnival's primary
defense here is that they focus
entirely on efficiency. Right. They've
stated they have cut fuel use by
18 percent since 2011, which, to
be fair, is an impressive engineering
feat. It really is. Especially considering
their passenger capacity grew by
more than 38 percent in that same
time. Right. They're moving way
more people for less fuel. But to
me, this sounds exactly like refusing
to lock in a fixed mortgage rate
right before inflation hits just
because you bought energy -efficient
light bulbs. That is a perfect analogy.
I mean, it's impressive that Carnival
cut usage by 18 percent. But if
Iran's warning of $200 a barrel
oil comes true, isn't efficiency
just like using a bucket to bail
out a flooded engine room? That
is exactly the way to look at it.
Because no matter how fast Carnival
bails water with their 18 percent
efficiency gains, a massive geopolitical
oil spike is a tidal wave. Yeah.
It completely swamps the bucket.
They are optimizing speeds, adjusting
itineraries, using new hull coatings.
But when global shocks hit, efficiency
only buffers a fraction of the blow.
Which brings us to the listener's
wallet. Yes. Because if you're sitting
at home right now looking at a $3
,000 summer cruise to Europe, you're
probably wondering, am I going to
get slapped with a surprise daily
fuel bill the week before I sail?
So when do you think the major US
lines will actually pass those daily
surcharges onto the consumer? That
is the multimillion dollar dilemma
in the boardrooms right now. I bet.
What we are really talking about
here is pricing power. Currently,
the major US lines are operating
from a position of incredible strength.
Royal Caribbean is forecasting record
-breaking earnings per share, and
they are operating at a 109 % load
factor. Wow! 109%. And their ships
are completely full. Yeah. And because
of that incredible momentum, operators
are absolutely terrified of killing
the golden goose by suddenly implementing
a surcharge. Especially because
this oil spike is hitting right
in the middle of wave season. Right.
Like from January through March,
that is the critical window when
cruise lines lock in a huge chunk
of their bookings for the entire
year. Precisely. To answer your
question, they're going to hold
off as long as humanly possible
in the US market. Really? Oh, yeah.
Now, US passenger contracts absolutely
allow them to do it. Right. Norwegian
can charge up to $10 a day per guest,
and Royal Caribbean can charge up
to $12 a day if oil passes certain
thresholds. OK, so the mechanism
is there. It's there. Yeah. But
invoking that during wave season
is a massive psychological buzzkill
for consumers who are already sensitive
to being nickel -and -dimed. Oh,
for sure. However, in the Asian
markets, lines have already pulled
the trigger. They have. Yeah. Passengers
on the Genting Dream are now paying
a surcharge of 15 Singapore dollars
a day. Wow. Star Voyager and Star
Navigator are charging up to 200
Hong Kong dollars and 600 new Taiwan
dollars per night. That sets a dangerous
precedent, honestly. It really does.
Even without the surcharges active
in the US yet, analysts are warning
that the geopolitical uncertainty
alone is threatening bookings. If
you are an American looking at a
higher -priced European or transatlantic
summer itinerary, you are already
hesitating because of the flight
costs and just global tension. Adding
a daily fuel surcharge on top of
that could completely stall booking
momentum for those third quarter
sailings. Which is huge. Exactly.
Those contribute disproportionately
to the cruise line's bottom line.
So it's a delicate balancing act.
They need to cover the skyrocketing
cost of moving the ship, but they
simply cannot afford to break the
consumer's enthusiasm for getting
on board. So if cruise lines are
completely at the mercy of unpredictable
geology in Alaska, and volatile
oil markets in the Middle East,
what can they control? That's the
million -dollar question. If the
outside world is this chaotic and
this expensive, the answer has to
be what's happening inside the passenger's
head. You have to sell the ship
as a timeless emotional sanctuary.
And when it comes to controlling
the psychological environment and
marketing the intangible, honestly,
no one does it quite like Disney.
Oh, totally. We saw this perfectly
executed during the March 15th Academy
Awards broadcast. Yes, we did. Disney
Cruise Land debuted a high profile
new ad campaign called Midnight
Magic. It was this massive prime
time national launch. And the ad
itself is fascinating because of
what it doesn't show. It follows
a father and son taking a quiet
late night walk on the deck of the
Disney charger. The ship is empty.
People have gone to bed. It's very
peaceful. Very. And the ad just
revisits this exact same simple
routine as the child grows into
an adult and eventually becomes
a parent himself walking the deck
with his own. child. And they set
the entire sequence to the married
life theme from Pixar's Up. Which
is basically a weaponized audio
trigger for tears. Oh, absolutely.
It gets you every time. It does.
But what is truly notable here is
the commentary from Denny's chief
marketing officer, Asad Ayaz. Right.
He explicitly stated that this campaign
intentionally de -emphasizes spectacle.
The focus is entirely on the quieter
moments that build real connection.
It's not about showing off a massive
new water slide or a Broadway -style
show. It's treating the multi -billion
dollar ship as a quiet backdrop
for a recurring emotional ritual.
And what's fascinating here is the
broader context of why they're doing
this right now. Okay, why? This
heavy emotional play. is happening
exactly as Disney is aggressively
expanding its fleet. They're aiming
to operate 13 ships by 2031. Wow,
13. Yeah. They just launched the
Disney Destiny from Florida in October
of 2025. Right. And they are preparing
to christen the Disney adventure
in Singapore. in March of 2026.
Which is a whole new market for
them. Exactly. It opens up an entirely
new market in Southeast Asia. Yeah.
So they have a massive amount of
new, expensive capacity that they
need to fill year round. So they
are essentially selling the quiet
campfire instead of the million
dollar fireworks show. That's a
great way to put it. But here's
what I'm wondering. With Disney
expanding to 13 ships by 2031 and
moving into these entirely new international
markets, Is this pivot to nostalgia
and quiet moments actually a calculated
necessity? Like, are they realizing
that you simply cannot win a purely
amenity arms race against other
mega ships forever? That is the
exact trap they're avoiding. It
is a brilliant strategy, and yes,
it's a calculated necessity. If
you look at the broader industry,
other lines are constantly battling
over who has the tallest roller
coaster at sea, or the biggest water
park, or the longest go -kart track.
But physical amenities depreciate.
A new ship comes out next year with
a slightly bigger slide, and suddenly
your multi -million -dollar spectacle
is obsolete. Yeah. The novelty inevitably
wears off. Once you've ridden the
coaster once, it doesn't have the
same draw five years later. Exactly.
But Disney is marketing a feeling.
And feelings, particularly nostalgia,
are immune to physical depreciation.
Establishing a multi -generational
family tradition like a midnight
walk on the deck creates the ultimate
competitive moat. Oh, I see. If
a family associates your brand with
their core formative memories of
growing up, they aren't going to
jump ship to a competitor just because
the competitor has a slightly better
buffet or a new surf simulator.
Right, the loyalty is locked in.
Exactly. That generational loyalty
guarantees repeat cruisers across
decades. Wow. When you are trying
to fill 13 massive ships worldwide,
regardless of whether oil is at
$100 a barrel or a glacier is retreating
in Alaska, you need that bulletproof
emotional loyalty to justify your
premium pricing. Because it physically
alters the consumer's valuation
of the trip. Yes, exactly. You aren't
paying $3 ,000 for transportation
and a buffet. You're paying $3 ,000
to preserve a family tradition.
Right. Which perfectly ties together
the massive outside forces we've
been tracking today. It really does.
You have nature permanently altering
the physical destinations we can
actually visit, forcing ships to
find new glaciers to maintain the
illusion. You have global oil markets.
making the simple act of moving
the ship from port to port increasingly
expensive, threatening corporate
profits and consumer wallets. And
in response, you have cruise lines
doubling down on the psychological
and emotional experiences that happen
entirely on the ship. The industry
is basically adapting by making
the vessel itself the irreplaceable
destination. Which brings me to
a final thought for you to ponder
today. If the destinations become
too geologically dangerous to reach
and the fuel becomes too prohibitively
expensive to burn, how long until
the mega ships stop sailing altogether?
Wow. Are we moving toward an era
where cruising simply means boarding
a permanently anchored floating
coastal resort? Will the future
of the cruise industry eventually
mean never actually leaving the
dock? That is a fascinating question.
Thanks for listening to Cruise News.
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