In today's conference call to discuss the last quarter's earnings, Carnival Corp chairman Micky Arison said the effects of Alaska's initiative, which imposed a $50 tax on passengers cruising to the state, are now becoming clear with bookings to Alaska down in the "double digit" percentages for the company. With pricing down, the $50 becomes even more significant.
He announced that Carnival intends to decrease capacity in Alaska in 2010, and specifics will be announced soon. Royal Caribbean International earlier announced reducing their presence in the market next year from three ships to two.
Arison went on to say that if the 2010 cuts don't help stabilize the market and improve yields, there will be additional cuts in 2011 capacity.
In response to one of the questions, Arison said the reduced capacity will also have an impact on their Princess Tours' and Holland America/Westours' land operations.
Proponents of the measure to increase the taxes in Alaska argued the public would not mind the additional taxes and cruise lines would not reduce capacity.
Further details will be in today's edition of CND.
Updated 11:05am EDT
