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RC Group delays future ship deliveries


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I don’t think this is surprising news at all.  Given the impact the global shutdown has had on manufacturing around the world it is nearly impossible to make up the time loss when these factories were shut down. 

 

I’m just excited to hear confirmation that in spite of COVID Royal remains committed to building a 6th Oasis Class ship.  There is no way she could be delivered during the second quarter of 2023 when they haven’t even cut the first piece of steel. I hope she will be built for the US/European market whereas Wonder clearly isn’t.  

Second quarter of 2024 really isn’t that far away seeing that in less than 8 weeks we will all bid adios to 2021 and welcome in 2022.

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  • 2 weeks later...

I don' know if this question should have it's own thread or not so I'm just going to post it here. 

On the main page on this site Royal has finally admitted what many of us already knew about Wonder of the Seas that it has less suites than any other Oasis Class ship. Their reasoning for less suite is interesting, they wanted a more exclusive area for suite guest which required space and to allow suite guest to have more space they limited the number of suites.  Royal also admitted they are seeing increased demand for suites and are selling out their Royal Suite Class.  

My question is this with Royal committed to building a 6th Oasis Class ship if the ship is to be based in the US and European markets two markets where demand for suites continues to rise at unprecedented rates, is there a way for Royal to address the lack of sufficient suites found on Wonder of the Seas while also providing an exclusive upscale area for suite guest that still provides enough space for suite guest to spread out?

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2 hours ago, JasonOasis said:

My question is this with Royal committed to building a 6th Oasis Class ship if the ship is to be based in the US and European markets two markets where demand for suites continues to rise at unprecedented rates, is there a way for Royal to address the lack of sufficient suites found on Wonder of the Seas while also providing an exclusive upscale area for suite guest that still provides enough space for suite guest to spread out?

It's too early to know what to expect with Oasis 6

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4 minutes ago, cruisellama said:

Rising fuel prices are also going to eat into return to profitability.  Delays are a prudent move.   From a profitability perspective, its unfortunate the shutdown occurred as fuel prices were at all time lows.

True, but fuel prices have been at an all time low due to the low demand that was created by the pandemic.  No pandemic and fuel prices would have unlikely dropped like they did.

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3 hours ago, JasonOasis said:

I don' know if this question should have it's own thread or not so I'm just going to post it here. 

On the main page on this site Royal has finally admitted what many of us already knew about Wonder of the Seas that it has less suites than any other Oasis Class ship. Their reasoning for less suite is interesting, they wanted a more exclusive area for suite guest which required space and to allow suite guest to have more space they limited the number of suites.  Royal also admitted they are seeing increased demand for suites and are selling out their Royal Suite Class.  

My question is this with Royal committed to building a 6th Oasis Class ship if the ship is to be based in the US and European markets two markets where demand for suites continues to rise at unprecedented rates, is there a way for Royal to address the lack of sufficient suites found on Wonder of the Seas while also providing an exclusive upscale area for suite guest that still provides enough space for suite guest to spread out?

That's a complex question.  I think Royal Caribbean International certainly enjoys the suite portfolio in combination with the rest of the "standard" product on RCI ships but the Royal Caribbean Group has other brands that serve the middle and higher tier suite markets.  

Richard Fain has always been very careful to create a lane for each brand and to avoid brands competing with each other to a large degree.  Royal Caribbean International is the mass market family brand.  Celebrity is for a more refined experience for an upscale clientele with a little more money to spend.  Silver Seas serves the true luxury market.

Royal Caribbean International does have a great suite product but they have to be careful containing it relative to the mass market nature of Royal Caribbean International.  In some cases they could make more money per square foot of cabin space since a significant portion of revenue is earned through onboard spend.  A Royal Loft Suite with a couple guest consumes the space where a dozen or more standard cabins could exist.  Thirty additional people versus two or three will go along way to overcome the price model of a Royal Loft Suite when you consider revenue beyond the cabin itself.  A dozen cabins at $2k each versus a $20k RLS?  That RLS might be costing them money to offer.

Then consider some Oasis class have too many suites relative to the suite venues such as Coastal Kitchen and the Suite Lounge.  Coastal Kitchen even with Pinnacle removed from the equation is oversubscribed on most Oasis class.  It's much better on Quantum class that have a lower suite count.  I see Wonder as a means to bring Oasis class back to where it should have been for suite amenities on this class.  

Royal was at a crossroads with Wonder.  In order to maintain the suite count they really needed to expand suite venues but that would mean taking more space away from the main reason why Royal Caribbean International exists - the non-suite cruiser.  

So while RCI does have a great suite portfolio and the Star Class concept is unique in the industry they will likely contain it and enjoy the fact that it sells out quickly rather than expand it and face the possibility that it becomes harder to sell it out completely.  Having a product that is in high demand is a good thing.  It may not be wise to flood the market with more suite capacity which could actually lower the price.  

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Wonder was created for the Chinese market. This market requires on one hand less suites and on the other hand who ever go to suites require much more exclusive services. You can see it in Spectrum were they came with the gold/silver dining room with areas which are only accessible to suite guest. Also the solarium was with suite guest access only.  If the 6th Oasis class will go to the same market I guess it will be more and less the same but if it will go to the US/Europe I think it will be more like the other Oasis.   

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There is also a need to balance Capital Expenditures.  All of the projects they have talked about (Amplifications, Port projects, private destination developments, Celebrity's Revolution program, Silversea ship conversions to Expedition) are expensive.  

The brands also brought a lot of capacity onboard during the pandemic.  Royal's capacity was flat, despite shedding two ships, by adding Odyssey. (Also worth noting, they planned to shed Grandeur to Pullmantur but that became unavailable during the pandemic).  Now they just took initial delivery of Wonder.  Celebrity took the Apex.  Silversea grew substantially with two full ships delivered (dawn and moon, I believe) and their replacement Galapagos vessel. Now for each brand it looks like they keep a 1 ship per year schedule with a year off in between some years, which is still a pretty quick schedule, especially given the sizes.  The smallest ship Royal adds in the next few years will be Icon family, over 200,000 tons. Celebrity and Silversea will each add new capacity which will be the largest in their fleets. 

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