Royal Caribbean cruises announced Thursday that it will keep its global operations suspended until June as the coronavirus shutdown continues to tighten its stranglehold on the cruise industry.
Royal Caribbean said it expects to return to service on June 12. It was the third time the company voluntarily cut upcoming services due to the health crisis. Its first timeline for return passed on April 10. And May 11 has now been changed to June 11.
All the three major cruise liners have been shuttered since mid-March.
And now Norwegian, Carnival and Royal Caribbean face economic collapse after the Centers for Disease Control and Prevention extended no-sail orders within U.S. territorial waters until perhaps July, according to reports.
Beyond that, each is locked out from the $2 trillion economic stimulus because they are incorporated outside America, in countries with more lenient tax, labor and safety laws.
In order for the cruise companies to ultimately return to service, the CDC is requiring that they come up with their own plans to deal with COVID-19 with minimal help from federal, state and local governments. The plans must be detailed and specific, and will then be subject to review and approval by the CDC and the U.S. Coast Guard.
The orders of course do not apply outside of U.S. territorial waters. Previously, however, Royal Caribbean was forced to cancel all Canadian and Alaska sailings through June 30, after Canada closed its ports.
In mid-March, at President Donald Trump’s urging, all three major cruise lines voluntarily agreed to suspend services for 30 days, without any specific order from the CDC to do so.
The Atlanta-based CDC declared a new mandatory no-sail provision that does not recognize the time cruise ships have already been off the seas.
After the nation’s top disease response agency posted orders keeping cruise ships docked last Wednesday night, extending the ban through August, the White House coronavirus task force stepped in to cut it by 20 days, according to USA Today.
When the no-sail order reappeared on the CDC’s website hours later, its language had been softened: Ships can sail again in July and an explicit warning that they could be docked even longer had been deleted, according to emails and internal documents obtained by USA Today.
“Sorry to do this, but the Office of the Vice President has instructed us to pull the No Sail Order Extension from the website immediately,” a CDC senior official wrote to staff just after 7 a.m. last week Thursday, the morning after the notice had been posted.
According to the CDC provisions, cruise lines will need to have plans in place to:
- Monitor passengers and conduct medical screenings on crew members.
- Train crew members on preventing the spread of COVID-19.
- Manage and respond to a COVID-19 outbreak on board.
But implementing the measures could take considerable time, and with no other sources of revenue, financial reserves drained and no help from the $2 trillion economic stimulus, cruise lines appear to be in more serious trouble than any other industry touched by the crisis.
Before the change in policy at CDC, investors had been somewhat optimistic that the industry could emerge from the shutdown with enough financial resources intact to avoid going into bankruptcy protection.
The length of time of the no-sail order depends on several factors, but either way creates an uncertain timeline for return.
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