Windjammer Cruises
shuts down

Its 1,000-passenger ship
is up for sale

By Russ Lynch
Star-Bulletin

Windjammer Cruises shut down its dinner cruise business today and said its 1,000-passenger vessel, Kulamanu, is for sale.

No information on layoffs was available but the company employs 50-125 people depending on the level of bookings.

Koen Witteveen, executive vice president of the ship's operator, ACES Dinner Cruises, said in a letter to the company's providers that ACES has suffered significant losses since buying the business in mid-1996.

"The losses incurred were due to the economic downturn in tourism in general and a reduction in the dinner cruise business in particular," Witteveen's letter said.

Witteveen also indicated that the company had held some hopes of recovery based on a form of shipboard gambling. He cited the state Legislature's failure to approve a shipboard gambling measure as one of the reasons for the shut-down.

ACES, a subsidiary of Florida-based Millamax Corp., spent about $200,000 renovating the vessel, formerly named the Rella Mae. About a year ago, the company sold its second ship, the 140-passenger, glass-bottom sightseeing boat Coral See.

Last May, Windjammer cut back is daily cruises to four a week because of a drop in business. The ship had been sailing on Sundays, Tuesdays, Thursdays and Saturdays since then.

But it wasn't able to keep going, Witteveen said, at least not with the big vessel. "The Kulamanu will be listed for sale and we intend to lease or purchase a new vessel, which will provide a better financial return on investment while being competitive in the marketplace," his letter said.

Windjammer Cruises has arranged with Roberts Hawaii to accommodate its customers on the Roberts cruise boat Alii Kai, Witteveen said.

Windjammer's suspension of business leaves four other operators active in the cruise business.

The leader is Royal Hawaiian Cruises, a unit of Pacific Marine & Supply Co., which operates five vessels from three islands. Its fleet includes the Navatek I, operating whale-watching and dinner cruises from Honolulu, and the smaller Navatek II on Maui.

Kathy Loui, company president, said Royal Hawaiian also is having to operate in a tighter market and has cut staff but is changing to meet the challenge.

"It's not anything to hide. Everyone's feeling the pinch with the Japanese economy as well as the local economy," she said.

Japanese tourists present a double problem because their numbers are down and many who do come to Hawaii are repeat visitors who don't want to repeat a cruise, Loui said.

"The way that all of us do business has got to change," she said. One way is the eco-tourism and adventure market, where growth is strong, she said. Royal Hawaiian also will add a new vessel on Kauai this summer.

Frank Alexich, general manager of Dream Cruises, said the dinner cruise business is down but his company, like Royal Hawaiian, is trying other activities such as daytime fun trips.

"All of us who rely on the visitor industry would probably share the sentiments that it is a difficult market out there. I think Koen is correct in his assessment of the dinner cruise business," Alexich said. He said it is a case of more seats and fewer people.

Dream has two dinner-cruise vessels and a smaller sports vessel. Roberts Hawaii has two vessels, the Alii Kai in Honolulu and another on the Big Island. The other operator is Paradise Cruise Ltd., with three vessels.