Passengers vote with their dollars as the Aussie sinks

It’s something Aussie-based cruise lines dealing in the Greenback need to be concerned about, if Cruise Passenger’s readers are anything to go by.

The Aussie dollar is at a new six-year low (this week trading at 73.98 US cents), and for those spending on Carnival and P&O ships, they will hardly notice the difference.

But for those on, for instance, Royal Caribbean – which traditionally has passengers paying their bills in the American currency – the going is getting increasingly tough.

And it doesn’t look like it is going to get better anytime soon. A Financial Review report this week had the dollar slumping further to 71 cents through the year.

Tracy Bremner of Clean Cruising told us: “I have had clients return from their holidays shocked at the conversion rates on board the ships.”

But she added that Australians are resilient travellers who will continue to cruise.

Royal Caribbean had this to say.

“As an international cruise brand sailing in all parts of the world, we strive to offer our guests the same high standard and international style of cruising wherever in the world we are, and onboard costs are priced in US dollars for a consistent experience.”

Meanwhile, over at Carnival Cruise Lines, P&O and Princess Cruises – which trade in Australian dollars onboard – the mood was decidedly upbeat. While not actually confirming an increase in inquiries thanks to the dollar, a spokesperson said sales were “going well”.

“Sales for P&O Cruises, Princess Cruises and Carnival Cruise Lines’ 12 locally based ships are strong, with travellers responding to the great-value fares as well as the ever-increasing range of cruises on offer from Australia,” a Carnival Australia spokesperson told Cruise Passenger.

“Cruising on these Australian-based cruise ships, where the Australian dollar is the onboard currency, means you can travel without having to worry about foreign exchange fluctuations – something travellers are clearly appreciating in the current climate.” Proven with P&O Cruises’ announcement that last year it served one million espressos across its three-ship fleet; specialty coffee onboard costs between AU$3 and AU$3.50.

Terry Davidson and his wife Diane, from NSW’s Central Coast, are loyal cruisers – and Cruise Passenger subscribers.

They described the new hardships they found on their last cruise, thanks to the changes in foreign exchange.

Having worked on P&O’s Fairstar back in the ’90s, they developed a love of the sea early on, and nowadays take at least two cruises every year. In their travels, the couple have cruised with Holland America Line, P&O, Celebrity and Royal Caribbean.

Terry was shocked, for instance, when the price of a cappuccino onboard Celebrity Century was more than he’s ever been charged.

“Celebrity had coffees in around the US$5 mark, when the Australian dollar was up around 80 cents. We worked it out that it was about $7 Aussie, and we just boycotted the whole place. And I went up and said to the people on the desk that if they did their spreadsheets, it’d be interesting to see how many people were not having their coffee as a result of the price hike.

Then there’s gratuities.

“We booked on [Royal Caribbean’s] Explorer of the Seas for a very pleasant cruise from Sydney back to Sydney in January. They advertise US$12 for their gratuities – we booked MyTime dining. Now, you add a quarter to that , you’re up to $16 Australian.”

And wine…

“If they’re charging US$36 for a bottle and then another quarter – that’s AU$48 – it’s getting out of proportion.”

Terry, who also worked in the banking sector prior to his retirement, is hoping the pressure on his back pocket will alleviate with his new membership level in Royal Caribbean’s Crown & Anchor Society.

“We’re up to Diamond,” he says, which means he and his wife are entitled to daily breakfast with the specialty coffee of their choice.

Terry’s advice to the lines?

“So many Australians cruise. Cruise companies need to realise the Australian dollar is falling,” he says. “And if they want to keep things at American dollars, they need to have things at reasonable prices. Because at the moment you’re losing a quarter of your dollar.”

So what’s an avid Aussie cruiser to do if the Aussie dollar keeps dropping?

Michelle Hutchison, Money Expert for online comparison network finder.com.au, recommends exchanging money sooner rather than later, if you’re planning to travel on a ship using US currency.

“Our survey has found the Australian dollar will trade in at 71 cents by the end of the year,” says Michelle. “To put this in perspective, exchanging $2000 Australian will return just US$1420 – that’s $580 lost in translation.”

And while you’re at it, make sure you’re not being ripped off.

“What Australians may not realise is that not all international money transfer providers offer equal transfer rates and fees. We’re already at a disadvantage by having a lower currency, so compare international transfer providers.”

Finally, Michelle advises booking cruises well in advance.

“Book that holiday you’ve been holding off on. Our dollar isn’t looking to get much better against the greenback anytime soon, so booking a cruise now could see the best return for your money – even if your departure date isn’t for a year or so!”