CoronaVirus Impact on the Cruise Industry

[Smokeyham]

My thinking is that the cruising industry is not dead.   So many people enjoy this form of travel that the demand will come back.  

 

I've read through most of this thread, and note that some people have raised the issue of whether or not ports will want the cruise ships to come back.  I agree that for some ports this will be the tipping point where they decide that the costs of cruise ships (high visitation, environmental and social damage, etc.) outweigh the benefits and so will ban them.  I'm thinking particularly of Venice.  However, I would suspect that most ports will welcome the ships back again.

On a different note, I wonder if the current situation will encourage cruise lines to accelerate the path some ships have already taken, i.e. to make the ship the destination?    This concept also includes the provision of privately owned islands.   In a perverse way, this could be sold as a safety enhancement.  Less contact with people in foreign lands, ships might be fitted with HEPA filters in ventilation systems, increased sanitization, etc.

 

[cruisemom42]

5 hours ago, Smokeyham said:

On a different note, I wonder if the current situation will encourage cruise lines to accelerate the path some ships have already taken, i.e. to make the ship the destination?    This concept also includes the provision of privately owned islands.   In a perverse way, this could be sold as a safety enhancement.  Less contact with people in foreign lands, ships might be fitted with HEPA filters in ventilation systems, increased sanitization, etc.

 

 

It might attract a certain percentage of customers, but I can't imagine it becoming the norm. I'd never cruise if it wasn't for the ports and itinerary.

[Charles4515]

My thinking is that the cruising industry is not dead.   So many people enjoy this form of travel that the demand will come back.  
 

 

We shall see. Celebrity Apex has never had a passenger and has an outbreak among the crew. Oasis of the Seas at anchorage off of CoCo Cay has an outbreak among the crew. Looks pretty bad for the cruise industry.



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[clo]

2 hours ago, cruisemom42 said:

 

It might attract a certain percentage of customers, but I can't imagine it becoming the norm. I'd never cruise if it wasn't for the ports and itinerary.

Nor we. But from being here for a short while there is certainly a contingent that are there for the ships.

[ilikeanswers]

2 hours ago, cruisemom42 said:

It might attract a certain percentage of customers, but I can't imagine it becoming the norm. I'd never cruise if it wasn't for the ports and itinerary.

 

In Australia we have a particular travel agency chain that for years was going downhill. Somewhere along the line they decided to focus on packaged travel. This meant they lost a percentage of independant travellers and backpackers are a significant percentage of travellers in Australia. Despite losing that percentage their profits went up and they ended up as the most successful travel agents in the country. Sometimes it can be more profitable to focus on a segment of customers rather than trying to appeal to everyone. If there are enough people who want the ship as the destination than perhaps the industry will move toward this especially if cruise ports decide to demand more from cruise lines🤔.

[Ava79]

I am not an economist or an expert on this topic, so I will just say my opinion. Of course, the coronavirus will have a devastating impact on many companies that organize cruises, perhaps this whole situation will lead to a tightening of many rules in the cruise industry (for example, to avoid cases like the Diamond Princess), but in general, globally, the industry is not threatened. As I have already said, those companies that have the resources and wisdom to adapt to the current situation will "stay afloat", and there will always be a demand for cruises. In addition, it seems to me that when the pandemic ends, the demand for various leisure activities including cruises, will increase significantly: people will get tired of sitting at home and being constantly restless. They will want to relax. But this, of course, will only happen when the danger has completely passed.

[cruisemom42]

1 hour ago, Ava79 said:

I am not an economist or an expert on this topic, so I will just say my opinion. Of course, the coronavirus will have a devastating impact on many companies that organize cruises, perhaps this whole situation will lead to a tightening of many rules in the cruise industry (for example, to avoid cases like the Diamond Princess), but in general, globally, the industry is not threatened. As I have already said, those companies that have the resources and wisdom to adapt to the current situation will "stay afloat", and there will always be a demand for cruises. In addition, it seems to me that when the pandemic ends, the demand for various leisure activities including cruises, will increase significantly: people will get tired of sitting at home and being constantly restless. They will want to relax. But this, of course, will only happen when the danger has completely passed.

 

However, we also should recognize that -- in some countries like the US -- a significant percentage of people are going to experience some economic hardships, either losing their job or not getting paid for a significant amount of time while business are closed. So the "bounce back" may not be so fast...  

 

I do agree it will happen. 

[ilikeanswers]

2 hours ago, Ava79 said:

In addition, it seems to me that when the pandemic ends, the demand for various leisure activities including cruises, will increase significantly: people will get tired of sitting at home and being constantly restless. They will want to relax. But this, of course, will only happen when the danger has completely passed.

 

I don't think people will easily forget this pandemic. This is the first pandemic that has been reported 24/7, the first one during the internet age and it is not an event that is happening over a few days this is looking like at least a year long process world wide. In Australia they are saying we will be locked down for a minimum of six months and even then only some restrictions will be lifted. After being so long conditioned into social distancing I think cruise lines will probably need to really convince people to take a chance on their ships especially in terms of attracting new customers who haven't yet been on a cruise.

[Grahambythesea]

Some thoughts. Firstly the cruise lines are being overly optimistic thinking they can recommence cruising in April! Europe and the USA will still be in the grip of this awful pandemic so ports are unlikely to be allowed to reopen. That’s not taking into account countries with less well organised health services where perhaps the pandemic hasn’t fully got hold, but it will do and we will see 100s of thousands more infected and sadly huge increases in the death toll. 
Secondly it will take months to redistribute the ships to the ports where they are supposed to be to pick up on their itineraries. You then must assume that they have been thoroughly deep cleaned top to bottom to ensure that they are safe to take passengers again. Many counties are going to want their Health Inspectors to check that it has been done satisfactorily.

Thirdly the restart is dependent on the resumption of air travel to deliver the passengers. Personally I’m a lost less confident that the airlines can get the planes clean than I am of the cruise companies achieving this.

It’s good to read that the crews are still on board, I thought that most would be offloaded and sent home to avoid having to pay them, however most “hotel” staff will be really struggling with no gratuities coming in.

Finally, the mega corporations will survive, albeit making huge losses this year and will have massive debt to service as they all seem to have been on massive spending trips buying new ships and refurbishing others, no doubt on borrowed funds like most large businesses. However, there will be casualties, I cannot see smaller independent companies surviving . 

 

[cruisemom42]

11 hours ago, ilikeanswers said:

 

Sometimes it can be more profitable to focus on a segment of customers rather than trying to appeal to everyone. If there are enough people who want the ship as the destination than perhaps the industry will move toward this especially if cruise ports decide to demand more from cruise lines🤔.

 

I feel this is a very good point. 

 

In the past couple of decades, market conditions have favored cruise lines converging as much toward a "mean" or single model of cruising as possible. This has included increasing the passenger capacity per ship as much as possible and holding basic ticket prices artificially low in order to get bodies on board, then create more and more opportunities to increase onboard spend for a more 'upscale' experience (specialty dining, suite perks, etc.)

 

I wonder if this will change that dynamic?  Would be lovely to see more smaller ships with greater space per person, but that will not fall within the budget of a great number of current cruisers...

[Explorer525]

The cruise industry has to come up with a way to test people before they enter the ship.  Abbott Labs has just developed a 5 minute coronavirus test.  There has to be a way to safely cruise again.  The main problem will be the ports that they go to.  Someone could catch corona from a native of an island or country.  Maybe the cruise lines could do cruises to nowhere or to their private islands.  The lockdown will probably last 60-80 days, but then people will be wary of getting on cruise ships. 

 

A viable treatment for the coronavirus that works right away would remedy this situation, as the ships could store this medicine in the dispensary on the ship.  They would have to have early detection of anyone getting sick. Keep the ship clean.  No more hand shaking, high fives,  or fist bumping.  That will be a relic of the past.   There are temperature devices that you just point at someones forehead.  The cruise industry has to re-invent itself to build confidence in people getting onboard. 

[clo]

2 hours ago, Explorer525 said:

A viable treatment for the coronavirus that works right away would remedy this situation, as the ships could store this medicine in the dispensary on the ship. 

Anti-virals are harder to develop than antibiotics. And I wonder if one is still contagious while on the drug.

 

2 hours ago, Explorer525 said:

No more hand shaking, high fives,  or fist bumping.  That will be a relic of the past.

Already is. We stopped that about a month ago and then stopped elbow bumping.

[Hlitner]

When I started this thread back in Feb, none of us could have predicted what was going to happen in the next month.  A few minutes ago I posted some new thoughts (on another thread) and will repost here:

 

This is a cruise blog web site, not a medical blog.   We think the cruise situation has now reached the point where the question should be "can the cruise industry survive COVID-19?"  A few days ago I would have said that its a ridiculous question.  But today, I think it is close to reality.  Consider that just today, RCI announced that they were cancelling all RCI, Celebrity and Azamara cruises through Sept 1!  Meanwhile, the USCG has informed the cruise industry to be prepared to deal with their own sick passengers and crew....including making private arrangements to evacuate them from ships off of FL.  What this means for potential passengers is that we can  no longer have any confidence of being able to access adequate medical care when on a ship.  Passengers have already died on HAL's Zaandam, possibly because of the cruise ship's inability to get them off the ship and to a decent hospital  That ship continues towards Fl with at least 2 more seriously ill passengers who have been refused evacuation to land-based hospitals, and the governor of FL has made it clear he does not want them in FL.

 

I have posted elsewhere that the cruise industry has encountered a "perfect storm" of circumstances that may well doom the industry.  Not only do we have the virus but we also have ports around the world closing their doors to any cruise ship.  Nobody knows if and when any of these ports will reopen.  We had 4 major cruises booked this year.  The first was a 30 day HAL cruise in April that was cancelled by HAL.  The 2nd is a 16 day Princess cruise in August that will either be cancelled by Princess or me...since the land-based reasons we booked that cruise have now been cancelled.   The 3rd is a 28 day Princess cruise in October, from Civitavecchia to Singapore that is now questionable.  And the 4th is a 2 week MSC Caribbean cruise in December which might actually happen if MSC manages to stay in business and some of the Caribbean ports reopen.  

 

I post all this info to emphasize that the situation in really bleak for the entire industry.  CCL, which probably has the deepest pockets of anyone in the industry has been working at raising another $7 Billion is cash, on top of at least another $3 Billion in current credit lines.  That is a lot of money and is obviously a desperate move to survive what they see as a horrible year.   If they are worried, then we should also be worried.

 

As I now reread what I have written I feel an awful degree of sadness.  I agree with those who say "we will get through this together" and the world economy will survive and perhaps become stronger then ever.  But it is becoming increasingly difficult to see a way forward for the major cruise corporations if they simply continue their current business model.

 

Hank

[Smokeyham]

8 minutes ago, Hlitner said:

When I started this thread back in Feb, none of us could have predicted what was going to happen in the next month. ........

 

Hank

Hank,

 

Thanks for the thoughtful and well written post.   It will be interesting to see where we are a year from now.   

[GottaKnowWhen]

1 hour ago, Hlitner said:

...  But today, I think it is close to reality.  Consider that just today, RCI announced that they were cancelling all RCI, Celebrity and Azamara cruises through Sept 1!  ...

Hank, where are you seeing this?

On the Royal site, headed "Updated April 1, 2020" they say:

 

Our goal is to resume operations for most of our ships on May 12^th, 2020

 

Nothing different I can see on the Celebrity site. Both show the Cruise With Confidence policy valid for cruises through 1 September, that was posted a few days ago.

 

Edit: I just went to the RCCL Press Center and found nothing there either...

    RCCL Press Releases

 

And by the way, thank you for a calming presence and thoughtful analysis throughout this situation...

 

Stan

 

Edited April 1, 2020 by GottaKnowWhen
added link

[clo]

Since this thread is about the impact of the virus on the cruise industry I thought I'd share this, past and present, about airlines. And remember that some people HAVE to fly but no one HAS to cruise.

 

https://www.cnn.com/2020/04/01/business/airline-industry-outlook/index.html?utm_source=fbbusiness&utm_term=link&utm_content=2020-04-01T16%3A30%3A12&utm_medium=social&fbclid=IwAR3BFo7SIEXdPAR0WHClFzojkfaSF7eNPwUW3QokC9-xivt65uPNBPuraiA

[Hlitner]

34 minutes ago, GottaKnowWhen said:

Hank, where are you seeing this?

On the Royal site, headed "Updated April 1, 2020" they say:

 

Our goal is to resume operations for most of our ships on May 12^th, 2020

 

Nothing different I can see on the Celebrity site. Both show the Cruise With Confidence policy valid for cruises through 1 September, that was posted a few days ago.

 

Edit: I just went to the RCCL Press Center and found nothing there either...

    RCCL Press Releases

 

And by the way, thank you for a calming presence and thoughtful analysis throughout this situation...

 

Stan

 

Stan,

Here is a link to the story.  I am assuming it is real although these days one never knows:

 

https://finance.yahoo.com/news/royal-caribbean-extends-operations-suspension-141602627.html

 

Could this be fake news?  We also must note that it is April Fools Day....but Yahoo.com is usually reliable.

 

Hank

[GottaKnowWhen]

4 minutes ago, Hlitner said:

Stan,

Here is a link to the story.  I am assuming it is real although these days one never knows:

 

https://finance.yahoo.com/news/royal-caribbean-extends-operations-suspension-141602627.html

 

Could this be fake news?

 

Hank

Go look again. That story has been withdrawn/replaced. I think the author initially was confused by the Cruise WithConfidence business, didn’t realize that it did not say that cruises are shut down.

[clo]

6 minutes ago, GottaKnowWhen said:

Go look again. That story has been withdrawn/replaced. I think the author initially was confused by the Cruise WithConfidence business, didn’t realize that it did not say that cruises are shut down.

It's still there when I clicked on it, twice.

[Hlitner]

1 minute ago, clo said:

It's still there when I clicked on it, twice.

It looks more and more like fake news.  The original story posted on Yahoo's Finance site, which is legit, says they are shutting down operations until 9/1.  But the source story on Zacks Equity site says something different and also shows it has been revised.   Guess we should assume it is fake news until it is confirmed by the cruise line.

 

Hank

[GottaKnowWhen]

1 minute ago, Hlitner said:

It looks more and more like fake news.  The original story posted on Yahoo's Finance site, which is legit, says they are shutting down operations until 9/1.  But the source story on Zacks Equity site says something different and also shows it has been revised.   Guess we should assume it is fake news until it is confirmed by the cruise line.

 

Hank

I had seen the story on Yahoo Finance but clicked through to the source and that is where I saw the revised version. A poorly written/researched story, later corrected but the original is still out there with misinformation... A downside of our electronic information  distribution system.

[dkjretired]

Hank:

 

Usually get an email on anything like this, nothing.

[Hlitner]

14 minutes ago, GottaKnowWhen said:

I had seen the story on Yahoo Finance but clicked through to the source and that is where I saw the revised version. A poorly written/researched story, later corrected but the original is still out there with misinformation... A downside of our electronic information  distribution system.

It that story was fake/wrong it is a darn shame because it will just increase the cancellation panic.  There is so much inaccurate news its hard to know the truth these days.  Consider the new 5 minute COVID-19 test from Abbott that has only received an emergency approval from the FDA.  Apparently that means that the FDA does not "confirm the accuracy of the test's results."  What on earth does that mean?

 

Hank

[clo]

Since this thread is about the impact of the virus on the cruise industry I thought I'd share this, past and present, about airlines. And remember that some people HAVE to fly but no one HAS to cruise.

 

https://www.cnn.com/2020/04/01/business/airline-industry-outlook/index.html?utm_source=fbbusiness&utm_term=link&utm_content=2020-04-01T16%3A30%3A12&utm_medium=social&fbclid=IwAR3BFo7SIEXdPAR0WHClFzojkfaSF7eNPwUW3QokC9-xivt65uPNBPuraiA

[Explorer525]

Keep in mind that cruises need ports to go to.  I suspect that most countries will ban cruise ships until a vaccine is developed and most people are vaccinated.  That means cruises to nowhere or cruises to cruise owned islands.  I cant see cruising resuming anytime soon.  The cruise companies will never be the same for many years, and they overbuilt ships with more on the way.