Tom Stieghorst
Tom Stieghorst

I've always thought one of the most interesting decisions a business makes is what to charge for its product.

Now that six additional brands have been approved to sail to Cuba, how will they price the cruises?

Are there similar destinations in the Caribbean to serve as a model? Really, there's nothing like it. Cuba is unique politically and is in a bit of a social and cultural time warp because of the U.S. trade embargo.

There's no history to go by because Cuba has been closed to cruises from the U.S. for more than half a century.

Price according to cost?  Most goods in Cuba are either expensive, of poor quality or hard to get because of the aforementioned embargo.

What about pricing similar to the competition? There's only one competitor to reference, Carnival Corp.'s Fathom, which has an entry level price of about $1,900 for a seven-night cruise.

One new entrant, Pearl Seas Cruises, has put a $7,800 price tag on a 10-day cruise that will hit seven stops in Cuba, including an overnight in Havana. That's a big leap from the Fathom level, but Pearl Seas has a boutique product and a nearly new ship with only 100 cabins.

Most of the ships bound for Cuba in the first half of 2017 will be vintage hulls such as the Azamara Quest, the Norwegian Sky or the Empress of the Seas, each more than 15 years old.  However, destination on a Cuba cruise will likely outweigh considerations about the hardware.

Perhaps the biggest factor in pricing for Cuba is that opportunities to go remain scarce. "Certainly, we think Cuba will demand a premium price," said Frank Del Rio, CEO of Norwegian Cruise Line Holdings, which  was granted permission for all three of its brands (Regent Seven Seas Cruises, Oceania and Norwegian Cruise Line) to sail to Cuba.

Del Rio said details about pricing are still being worked out.

He said that between Norwegian and Royal Caribbean Cruises Ltd., a relative handful of sailings are being offered. "So [you have] scarcity, value, combined with the fact a real brand cruise line has never gone to Cuba; [that] should be the perfect combination to command premium pricing," Del Rio said.

Comments
JDS Travel News JDS Viewpoints JDS Africa/MI