Skip to comments.Financial Analysts Think No Cruises Until March
Posted on 10/26/2020 2:25:45 PM PDT by Capt. Tom
According to a paper published by analysts Paul Golding and Charles Yu at Macquarie Financial Services, reported by Barrons, it is unlikely that cruising would resume next month.
The company, which has significant financial standing in the Maritime industry, bases its conclusion on a fluid political situation in the United States and increasing levels of Covid infections in the United States and Europe.
Cruise Lines Remain Hopeful The report says that cruises will most likely only resume in March, despite what insiders in the industry are projecting. This is against the positive outlook that the CEOs of Carnival Corporation and Royal Caribbean have been saying lately.
Arnold Donald, CEO of Carnival Corporation, believes there is every reason to believe that ships will be sailing before the end of the year. It is also important to note that the current CDC No-Sail order is through October 31, 2020.
Should the financial analysts be correct, then Royal Caribbean, Carnival Corp., and Norwegian Cruise Line Holdings will see another four months of no operations. In an industry currently burning through billions of dollars per month, it would put the cruise industry in a stranglehold.
False Start Could Have a Lasting Impact The largest issue that the financial experts at Macquarie note is the possibility of a false start. While ships are relatively cheap to have at anchor, the amounts of money spent on ships to sail are enormous.
Cruise lines bringing in thousands of crew members to the ships, going through the process of testing and quarantining them, setting up and fuelling ships, and bringing ships up to standard to commence guest operations, is a process that costs billions of dollars.
Should it happen, which is possible, that the cruise industry is shut down immediately after restarting U.S. cruises, then this could well change the cruise industry for years to come.
While no one knows what the stance is of Joe Biden on the cruise industry, it would certainly be reasonable to think that President Trump will be less restrictive than Joe Biden if he were to be elected. Biden has made it no secret he plans to employ measures the Trump administration has not used. What this would mean for the cruise industry is entirely unsure.
European Cruises are Stress Tests
With the resurgence of cases across Europe, AIDA and Costa cruises are effectively stress tests for the industry, the analysts note. But even if these sailings continue without incident, we think regional health officials will still layer in restrictions if infections outstrip hospital capacity in these countries.
So although the industrys efforts count towards seeing if cruising is a possibility with COVID-19 raging around the globe, according to the analysts at Macquarie, it is all rather pointless.
Also Read: European Cruise Lines See COVID Issues On The Rise
And they seem to have a point here; there will come a point where a ship will have an outbreak. Will the local authorities let tourists on vacation take up valuable hospital beds? If not, the cruise industry will need to rethink their entire modus operandi during the pandemic radically.
As it stands, Royal Caribbean, Carnival, and Norwegian all continue to take bookings into 2021 and beyond. However with a limited capacity and if cruise ships remain on hold for even longer they could be forced to take more drastic actions.
It would be interesting to see which companies will be able to survive such a hit and which companies will secure government
IMHO if it goes on into March 2021 Norwegian will go Chapter 11 to reorganize, and may have some company, as the other cruise lines re-evaluate their posiion with their creditors.
CARNIVAL LINE is spending 700 million per month with little or no income during the shutdown. - Tom
More room to toss Mitt Romney in the ocean.
One thing for sure, we will know in a few days. -Tom
Just restrict bookings to healthy people under age 60 for a trial period of say 3-4 months. Death rates for healthy people under age 60 from covid-19 is 0.5%....lower than auto crashes, drug overdoses, AIDS, drug resistant TB. They recover fast.
I am afraid he would not sink, he is full of too much hot air.
Then puncture him. Quit with the excuses.
I’m not surprised. With the ships tied up in port since more or less March 2020, it will take a couple of months to being the ships back to operational condition.
Great. :( NCL is one of my husband’s biggest clients.
And the problem is: if a few covid cases emerge after billions of dollars spent to renew cruising, a CDC shutdown will occur, and idle crews and ships will be a further expense, with no income.
How lucky do you feel? -Tom
Financial analysts are 100% right when telling you what happened in the past. Otherwise, not so much. Consider a China Plague vaccination coming out before Christmas or maybe even by Thanksgiving. That reopens the cruise industry.
entropy12 wrote: “Just restrict bookings to healthy people under age 60 for a trial period of say 3-4 months. Death rates for healthy people under age 60 from covid-19 is 0.5%....lower than auto crashes, drug overdoses, AIDS, drug resistant TB. They recover fast.”
There was a rumor that the cruise lines might not allow passengers over 70 with two or more comorbidities, ie, heart conditions, diabetes, etc., to cruise. The social media site, cruise critic, went high order complaining that this was illegal age discrimination.
Theyre not in port..The cruise ships are over by the Bahamas in clusters of their own cruise lines...the Carnival ones all together...nearby the Royal Caribbean ships further on the Norwegians...
Many people will not get vaccinated for the Covid -19 threat.
If that vaccination is a requirement to get on a cruise ship many cruisers will be left out ,and that is not good for the cruise business.
A problem working against the Cruise line is TIME, with no income to offset expenses.
They are spending billions while getting no income, and further delays will bankrupt them. -Tom
With that very reasonable post, Im going to hazard a guess that the supply of razor blades is going up as more ships head to the breakers.
Any hour or day now, we will know what the CDC plans for the Cruise Lines, as the CDC shutdowns in the USA ends on this coming Sunday Nov.1st. - Tom
The annalists in this thread believe no cruises in 2020 and the cruises will be put off into 2021.
A recent development with Carnival is Princess Cruises which is one of Carnival Corporation cruise brands has decided to extend its pause in operations through May 2021.
Now this postponement is in Australia, but may be a sign of what to expect in this country from Carnival.
Time will tell in a few days. -Tom
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.