When will cruising resume? Here’s our (new) best guess
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Editor’s note: This story has been updated with TPG’s new projections for when cruise lines might resume sailings. Some comments may refer to an earlier version of the story.
When will cruising resume?
As the resident cruise expert at The Points Guy, I’ve been getting that question almost every day — via emails from readers, comments on stories and even Slack messages from colleagues.
It’s a question that’s top of mind right now for everyone from cruise line employees and travel agents, who are losing their jobs by the thousands as cruises remain on hold, to investors with stakes in cruise companies and cruise fans who are eager to get back to sea.
It’s also a question that’s almost impossible to answer.
As the editorial chief of the world’s biggest cruise planning site, Cruise Critic, put it to me recently, the new coronavirus is in control of the narrative right now — and how it drives that narrative in the coming months still is up in the air.
“Given the uncertainty of the virus and how it will continue to affect everyday life at a global scale, it’s nearly impossible to say definitively when cruise ships will begin sailing again,” said Cruise Critic editor-in-chief, Colleen McDaniel.
Still, by reading the tea leaves — comments by cruise industry executives, health officials and the destinations that cruise ships visit, for instance — we can at least start to narrow the range of possible outcomes as to when, and how, cruising could make a comeback.
When society is ready
For now, some major lines only have canceled sailings into June. Cruise giant Royal Caribbean, for instance, says it will resume operations on June 12. Other lines, such as Princess Cruises, Holland America and Seabourn, have canceled most sailings well into the fall. Seabourn has said three of its five ships won’t resume operations until November.
Still, these dates are just placeholders. Cruise executives admit they don’t really know when cruising will be able to restart. They’re hoping for a quick comeback, but they acknowledge a resumption date could be many months away.
In a recent conference call with The Points Guy and several other media outlets, Carnival Corp. CEO Arnold Donald said the timing for a comeback of cruising would depend a lot on how long society wants to steer clear of social gatherings.
“Cruise by definition is social gathering,” Donald said in response to a question about when cruising might start up again. “When society is ready for social gathering, and feels comfortable with social gathering, then we can begin to really talk about cruise.”
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Donald suggested nobody really knows when that time will come.
“All the various brands have made assessments, and they put out new target dates [for resuming operation] and whatnot, [and] in the end we’re hoping that it will be sooner rather than later,” Donald said. “But we are going to be driven by not what we choose to do, but by what society is prepared to do in terms of social gathering.”
On that front, it may be significant that calls to widely reopen the United States and other destinations have grown in recent weeks. But how quickly such calls translate into a willingness to resume significant social gathering by a critical mass of society remains to be seen.
Carnival Corp. is the parent company of Carnival, Holland America, Princess and six more of the world’s biggest cruise brands. It accounts for about 45% of all cruises taken worldwide.
Governments have to be on board
As noted, the push to reopen society — and allow for at least limited social gathering — has been growing in some areas of the U.S. and beyond for weeks. But even if society in general becomes more comfortable with social gatherings, that doesn’t mean cruising can resume immediately. Cruise lines still will need to get the OK from an array of local, state and federal officials, including health officials, in the places where their ships are based. That may not come right away.
In the U.S., for instance, health officials have expressed frustration with the cruise industry’s initial response to the coronavirus outbreak. They appear hesitant to let cruising resume without significant changes to the way the industry operates.
In an extended “no-sail” order issued last month for cruise ships sailing in U.S. waters, the U.S. Centers for Disease Control and Prevention (CDC) ordered the industry to develop a far more robust plan for preventing outbreaks of coronavirus on ships than it had developed to date.
“Cruise ship travel markedly increases the risk and impact of the COVID-19 disease outbreak within the United States,” the agency said in the nine-page order, which was critical of the industry. “If unrestricted cruise ship passenger operations were permitted to resume, infected and exposed cruise ship cases would place healthcare workers at substantial increased risk.”
The CDC has broad powers to halt ships from sailing in U.S. waters if it determines a risk to the public health.
For now, the CDC’s “no-sail” order extends through July 24 — well beyond the dates that some cruise lines have said they would resume sailings. In theory, the order can be reversed by CDC director Robert Redfield, should he deem that warranted. But such a reversal seems increasingly unlikely, given the ongoing spread of the coronavirus. If anything, the order might be extended into August or beyond.
Keep in mind that U.S. officials aren’t the only ones with a say on whether cruise ships sail — and who is allowed to sail on them. For vessels operating in Europe, Asia or other regions of the world, cruise lines will need the permission of various local authorities.
Rudi Schreiner, the president and co-founder of river line AmaWaterways, thinks European authorities could allow some river cruise operators in Europe to restart service in the coming months. But they may not allow Americans to go on the trips right away, he told TPG.
“Recovering European countries could turn away Americans for a time since they lag on the virus curve, and different parts of the U.S. are harder hit than others,” Schreiner said.
AmaWaterways has paused its operations worldwide through the end of July. The company markets voyages on 22 river ships in Europe as well as vessels in Asia and Africa.
The rebound won’t happen everywhere at once
One factor complicating the comeback of cruising is that some ports may remain closed to cruise ships for a time while others reopen, making a resumption of standard itineraries difficult.
Some major cruise destinations from the Bahamas to the South Pacific have been notably strict with their entry requirements since the coronavirus crisis began. They may be slow to open back up. Already, officials in one well-known Caribbean cruise destination, the Cayman Islands, have said cruise ships won’t be allowed back until at least September. And in the Indian Ocean, the Seychelles, is banning cruise ships through 2022.
In his recent call with TPG and other media, Carnival Corp.’s Donald suggested cruising could resume at different times in different places, with only some vessels coming back initially.
Ships based in China, for instance, could be among the first to resume departures, if only because China has started relaxing social distancing rules ahead of other countries.
“Because of that — and that alone — it’s possible that China could be one of the first markets where cruise can be renewed,” Donald said. “There are other issues, though, not the least of which is where the cruise is going to go.”
The issue of which ports reopen, and when, is a big one for the cruise industry.
In response to a question from TPG, Donald suggested that even when cruising comes backs, the routings on the schedule for some ships would have to be revamped — at least for a few months.
“In the near term, once we start sailing, it’s going to be different because I doubt seriously all destinations will open simultaneously,” Donald said. “There’ll be different protocols and regulations and so on in one place versus another.”
Airlift is critical
Donald also noted the return of some cruise itineraries will be dependent on a resumption of an adequate amount of airlift to regional cruise hubs.
While many airlines have continued to fly during the coronavirus crisis, the total number of flights worldwide has plummeted, and some airlines already have indicated they would be slow to return to old levels of operations. Some airlines may never come back.
As with the resumption of cruises, the resumption of an adequate schedule of flights worldwide is partly dependent on what travel restrictions various governments keep in place in the coming months.
“We do have a number of brands that are very reliant on airlift to get guests to the embarkation point, so we’ll have to wait and see,” Donald said. “We don’t know which destinations will open up when … until we see more movement, it’s hard to predict exactly what form and shape [the resumption of cruising] will take.”
Many industry watchers expect lines to initially focus on short sailings from “home ports” near major population centers that passengers can reach by car instead of plane. In addition to eliminating the need for a flight to reach them, shorter sailings from regional hubs will offer customers a way to dip their toes back into cruising without overly committing.
Still, even this strategy is not a given. In a conference call with Wall Street analysts this week, Norwegian Cruise Line Holdings president and CEO Frank Del Rio said the company continues to get bookings for sailings in far-flung destinations such as Asia that require a long-haul flight to reach. In a one-on-one interview with TPG several days earlier, Del Rio had said he hoped the company could stick to its current schedule of itineraries when cruising resumed.
The bottom line, say industry watchers, is cruising could resume in fits and starts.
“When the time comes, dates of resumption will vary by cruise line, since … they will likely phase in ships at different rates,” McDaniel said. “It’s also likely we’ll see adjustments of certain itineraries to account for the varied return of tourism in port cities.”
The worst-case scenario
There’s a worst-case scenario floating around among industry watchers as to when cruising could resume: Not until late this year or even early 2021.
This sort of projection assumes the coronavirus outbreak isn’t well contained in the coming weeks and months (or is contained and then flares again) and, as a result, health authorities such as the CDC conclude it’s too early to allow cruising to resume.
Even as recently as a few weeks ago, this was considered an outlier scenario — one not many people expected. But with coronavirus case counts remaining stubbornly high, and even growing in some parts of the U.S., even those within the industry say it’s no longer unthinkable.
In recent weeks, the big publicly traded cruise companies have taken drastic actions to ensure they can survive just such a worst-case scenario. Last week, Norwegian Cruise Line Holdings sold more than $2 billion in debt and equity at distressed prices in a move it said would give it enough liquidity to survive a shutdown lasting as long as 18 months. Carnival Corp., too, has shored up its finances with debt and equity sales. Both companies as well as Royal Caribbean Cruises — the parent company of Royal Caribbean, Celebrity Cruises, Azamara and Silversea — have laid off or furloughed large portions of their employees to reduce spending.
The companies don’t expect such a worst-case scenario. But the point is, they no longer think the odds of such a scenario are zero.
Most Wall Street analysts who follow the cruise industry don’t expect such a dire outcome, either, even as they praise cruise companies for planning for the worst. Leisure analyst Harry Curtis of Instinet, for instance, has modeled a partial resumption of cruising by the middle of the third quarter of this year.
In a research note to investors several weeks ago, Curtis suggested the major cruise companies could be able to get half their fleets back into operation during the second half of the year.
Our best guess
So, where does all of the above leave us? Will cruising be resuming this summer? This fall? Could cruising really be on hold until early next year?
Like everybody else, I will start by saying it’s impossible right now to know for sure. If anybody tells you differently, don’t believe them.
But I do think it’s possible to offer a range of probability of the most likely outcomes. That’s how I think you should look at a question like this. There is no right answer. Just a range of possible outcomes, some more likely than others.
Given that caveat, I think the highest probability — let’s call it 50% — is that some cruising resumes toward the end of summer — maybe in August, or early September. But it may not be as big a return to cruising as some cruise fans hope. I think there’s a smaller probability, maybe 30%, that cruising doesn’t resume in a meaningful way until the fall. That leaves 20% for the worst-case scenario, which is that cruising is on hold until 2021.
In this regard, I am a little more pessimistic than I was just a few weeks ago. When this story originally posted, on April 21, I was eyeing a return of at least a sliver of cruising as early as July or August. But in the intervening weeks, the pace of new coronavirus cases in the U.S. has failed to decline at the rate some models had projected, which could result in government officials being more cautious about allowing cruising to resume.
Cruise executives also have grown more pessimistic in recent weeks about a summer comeback for cruising. Norwegian’s Del Rio last week told TPG his best guess now was that the company’s ships would be in a position to resume limited sailings late in the third quarter of this year. That suggests a comeback in late August or September. But he made clear that nothing is for sure.
Del Rio also said that when Norwegian’s three brands return to cruising, it only would be with a handful of their 28 vessels — maybe just five or six at first. It could take six months for the lines to get all of their ships back into operation, he said.
Like AmaWaterways’ Schreiner, I can see river cruising starting up relatively early, as by definition it’s a small-group activity — something health authorities will have an easier time approving. Even the biggest cruise vessels on many rivers have fewer than 100 cabins. River cruising also takes place within the borders of countries. In a worst-case situation where someone on a river ship falls ill, the logistics of responding to the situation won’t be nearly as complex for authorities as the process of responding to an outbreak on a big ocean ship.
I’m also betting some very small oceangoing vessels will be able to resume operations earlier than big ships — such as the vessels operated by Alaska specialist UnCruise Adventures or U.S.-focused American Cruise Lines. UnCruise Adventures offers adventure-focused, outdoorsy trips on intimate vessels that hold just 22 to 86 passengers. American Cruise Lines operates coastal cruises in U.S. waters and river trips on vessels that carry as few as 100 passengers.
In its “no-sail” order, the CDC notably exempted small cruise vessels designed to carry fewer than 250 passengers and crew, presumably deeming them less of a risk to the public health system. In theory, some of the ships operated by UnCruise Adventures and American Cruise Lines could begin operating in the coming weeks as more states begin lifting stay-at-home orders, though I don’t expect that. American Cruise Lines already has canceled all its sailings through June 21.
As for bigger ships, my best guess is the odds are in favor of some sort of tiptoe back into operations by very late in the summer in several regions around the world. But, initially, they might just be short cruises aimed at a local crowd. In North America, that would mean quick trips out of ports such as Miami and Port Canaveral.
Additional resources for cruisers during the coronavirus outbreak:
- How to cancel or postpone a cruise due to coronavirus
- Everything you need to know about a future cruise credit
- Expecting a refund for a canceled cruise? Here’s how long it will take
- Good news for cruisers worried about strict new boarding rules
- Some of the year’s hottest new ships could be delayed
- Stream these 13 movies, TV shows to get your cruise ship fix
Feature image courtesy of Royal Caribbean.
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