If you ever want to drift down the Danube while looking up at medieval castles, explore the Mekong River Delta in Vietnam or travel from St. Petersburg to Moscow on the Volga, your trip will probably start in the San Fernando Valley.
Three of the world’s largest river cruise companies are headquartered a few miles from each other in the West Valley. Why? Because of one guy, Rudi Schreiner, a Woodland Hills resident. He saved the first cruise company and started two more. And he likes short commutes.
Schreiner, who now is part owner of one of the companies and no longer affiliated with the other two, estimated that the combined annual revenue of all three companies reached a milestone of $1 billion last year. Those three companies employ about 430 people in their headquarters.
Schreiner is chief executive of AmaWaterways in Chatsworth. It sells river cruises, mostly in Europe. Each trip lasts 12 to 15 days, sailing by night and stopping at cities during the day. The cost is about $3,200 to $3,600 per passenger, but a couple may spend as much as $10,000 because they must fly to their cruise departure city.
His company served about 60,000 passengers last year and had revenue of about $200 million, he said. It employs 80.
“I started this product of river cruises and then each company sort of grew out of the previous one,” Schreiner explained. “For the next few years, I expect the industry will see annual revenue increases of 25 to 30 percent per year.”
How the West Valley became the river cruise capital began inauspiciously. An Austrian native, Schreiner came to Los Angeles in 1982 and opened Student Travel International in Northridge, serving students who wanted to study abroad. Later he briefly opened his own travel agency before taking a job in 1992 at Northridge travel company UniWorld.
At the time, UniWorld ran motor coach tours in Yugoslavia and Eastern Europe, but the civil war raging across the region devastated business. The company charged Schreiner with creating a new travel product.
Rolling on the river
He had read a newspaper article about the newly completed Rhine-Main-Danube canal, which connected the major rivers in Central Europe and created a 3,000-mile long waterway. Although the canal was built for barges, Schreiner figured it could support cruise vessels as well.
UniWorld’s first river cruise launched in 1994 with 100 passengers. Six years later, it sold about 18,000 tour tickets annually. The company was acquired by London-based Travel Corp. in 2006.
In 2000, Viking River Cruises recruited Schreiner to open its U.S. office. He quit UniWorld and rented space in Woodland Hills near his home, despite pressure from the owners to relocate to New York because it would be closer to the company’s headquarters in Norway. But as the U.S. market grew, Viking ended up moving its headquarters from Europe to Woodland Hills.
But after two years at Viking, Schreiner yearned to open his own cruise line. He quit Viking, and he and two partners started AmaWaterways in 2002 in a Chatsworth building owned by one of the partners.
All the companies flag their ships in countries where they operate. Their main suppliers are along the rivers and the workers on the ships are employed by local companies. The only function in Los Angeles is marketing.
Neither UniWorld nor Viking provided executives to comment on this story.
Schreiner said the three companies book U.S. passengers into ship cruises on European, Chinese, Vietnamese, African and Russian rivers. The competitors recruit sales people from each other, but the owners meet for lunch regularly to discuss common issues and promote river tourism.
Schreiner believes none of the companies will be moving any time soon.
“Once you establish a company in a certain place, it’s difficult to move because of your loyal staff,” he said. “At one point we almost bought a building and moved to Agoura, but we decided to stay because even that kind of move affects your staff. The other companies have the same problem – they rely on their staff.”
Christine Cooper, an economist and vice president at the Los Angeles County Economic Development Corp., said that clusters of similar companies sometimes occur because of geography or natural resources, but other times it’s an accident of history.
“Somebody happens to live somewhere, they develop a product and that’s the seed of an industry,” Cooper said. “As the cluster develops, it attracts people with certain skills. With more production and competition, those skills get better until you’ll see a pool of labor for that industry.”
At first glance, it would seem that the river cruise industry is mobile, she said, because the owners could live in Los Angeles and outsource the sales function to call centers anywhere in the world. But apparently the three companies have developed a critical mass of a specific type of salesperson, and the need for that skill keeps them in the San Fernando Valley.
“If working for them they’ll keep it here,” she concluded. “There’s no compelling reason to move it.”
