WDW during a Recession / Economic Downturn

[Sirwalterraleigh]

I’m weirdly on the consumer end of things. If prices have to drift down 20-30% to fill a doubled sized fleet, we’re all better off. Great! Even Dis will be making more money.

I have never liked or felt DCL commands its price premium and it’s extremely artificial because they have, until recently, kept the fleet too small. DCL also didn’t used to have this massive price discrepancy. It has grown as their fan base has outswept fleet growth.

Also just in terms of sheer financial viability, look how well RCCL is doing these days. It’s just a cruise operator and its market value competes with Disney’s entire park sector.

Oh the price should absolutely come down…that’s been the case for many years

But I Doubt it will turn out in the consumers favor based on recent precedent

 

[Nubs70]

I’m weirdly on the consumer end of things. If prices have to drift down 20-30% to fill a doubled sized fleet, we’re all better off. Great! Even Dis will be making more money.

I have never liked or felt DCL commands its price premium and it’s extremely artificial because they have, until recently, kept the fleet too small. DCL also didn’t used to have this massive price discrepancy. It has grown as their fan base has outswept fleet growth.

Also just in terms of sheer financial viability, look how well RCCL is doing these days. It’s just a cruise operator and its market value competes with Disney’s entire park sector.

Yes, as a customer you are better off.

However, DCL is not better off as their margins will decrease. This is the problem today with most companies. DIS focuses on the margin not the dollars. If a discount of 30% is needed to fill the boat, offerings and quality need to decrease 30% to maintain the expected/required margin.

 

[BrianLo]

Yes, as a customer you are better off.

However, DCL is not better off as their margins will decrease. This is the problem today with most companies. DIS focuses on the margin not the dollars. If a discount of 30% is needed to fill the boat, offerings and quality need to decrease 30% to maintain the expected/required margin.

Yes margins will worsen, but I’m talking in part about softer margins with significantly more product to sell. It’s a balancing act. But DCL is frankly sitting at the bottom of a mountain 8 other operators have climbed. It’s not a case of WDW already being the market leader. They are letting significant market share go to the wayside by having been too sluggish in their expansion.

Basically DCL is the last operator I’d sound the alarm on. If anyone is going to expand too big first, it’s Royal.

Though their strategy seems also sound.

 

[Nubs70]

Yes margins will worsen, but I’m talking in part about softer margins with significantly more product to sell. It’s a balancing act. But DCL is frankly sitting at the bottom of a mountain 8 other operators have climbed. It’s not a case of WDW already being the market leader. They are letting significant market share go to the wayside by having been too sluggish in their expansion.

Basically DCL is the last operator I’d sound the alarm on. If anyone is going to expand too big first, it’s Royal.

Though their strategy seems also sound.

It should be a balancing act but to a newly minted B school grad, its margin or nothing. This is how my company lost $40MM worth of business this year. Their target was margin. Margin uber alles

 

[Sirwalterraleigh]

Yes, as a customer you are better off.

However, DCL is not better off as their margins will decrease. This is the problem today with most companies. DIS focuses on the margin not the dollars. If a discount of 30% is needed to fill the boat, offerings and quality need to decrease 30% to maintain the expected/required margin.

Actually Disney now follows a stupid philosophy where they increase the prices AND reduce the overhead with cuts…believing they aren’t subjects to the effects generated by such moves in a marketplace

Really is the worst of both worlds and why there Rep is taking a huge beating in recent years

 

[Sirwalterraleigh]

Yes margins will worsen, but I’m talking in part about softer margins with significantly more product to sell. It’s a balancing act. But DCL is frankly sitting at the bottom of a mountain 8 other operators have climbed. It’s not a case of WDW already being the market leader. They are letting significant market share go to the wayside by having been too sluggish in their expansion.

Basically DCL is the last operator I’d sound the alarm on. If anyone is going to expand too big first, it’s Royal.

Though their strategy seems also sound.

Ooohhh…what you’re describing is more of a saturation/volume…which requires middle class

You sure you’re looking at this one right?

 

[BrianLo]

Ooohhh…what you’re describing is more of a saturation/volume…which requires middle class

You sure you’re looking at this one right?

This is really what I’m looking at and questioning why DCL has reached its limit.

This is actually a criticism of how they’ve managed their fleet. Squeezing consumers instead of expanding passenger market share.

Which also speaks to an Icon carries 1/3rd of DCL’s current fleet wide capacity. That’s literally nuts.

 

[Sirwalterraleigh]

This is really what I’m looking at and questioning why DCL has reached its limit.

View attachment 871653

This is actually a criticism of how they’ve managed their fleet. Squeezing consumers instead of expanding passenger market share.

Which also speaks to an Icon carries 1/3rd of DCL’s current fleet wide capacity. That’s literally nuts.

I think that was always deliberate and based in lessons learned around the time of DCLs launch…

They limited their supply to maintain the demand and were very content with that

Now they’re rolling out 5? Ships in a few years after having 2-4 over 20?

So what has changed? Nobody probably wants to dig deep on that