New orders for cruise ships could be on hold for some time

Oct 7, 2020

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

It’s official: The cruise ship ordering boom is on hold — perhaps for some time.

Citing the ongoing impact of the coronavirus crisis, the leaders of the world’s four big cruise companies on Tuesday said they had no plans to order new vessels anytime soon.

“I don’t think anybody should be concerned about (orders for) new ships being placed,” MSC Cruises executive chairman Pierfrancesco Vago said at the keynote opening session of Seatrade Cruise Virtual, an online version of the cruise industry’s annual meetup. “We have enough already on order that must be delivered.”

For more cruise news, reviews and tips, sign up for TPG’s new cruise newsletter.

Vago noted that MSC Cruises already had 11 vessels on order for delivery. The company announced a trio of shipyard deals for six new ships in January, just weeks before the cruise industry began shutting down due to the coronavirus outbreak.

Vago’s comments came just moments after Norwegian Cruise Line Holdings president and CEO Frank Del Rio suggested the company wouldn’t be ordering new ships until 2022 at the earliest. The company already has nine vessels on order for its three brands: Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises.

“I think I’ll take delivery of at least one vessel for those brands before I start thinking about additional orders,” Del Rio said.

Related: The best credit cards for booking cruises

Norwegian Cruise Line's 3,998-passenger Norwegian Encore. (Photo courtesy of Norwegian Cruise Line)
Norwegian Cruise Line and its sister brands have nine vessels on order for delivery through 2027. (Photo courtesy of Norwegian Cruise Line)

None of the nine vessels that the three Norwegian Cruise Line Holdings brands have on order are due for delivery until 2022.

Royal Caribbean Group chairman and CEO Richard Fain and Carnival Corporation president and CEO Arnold Donald also suggested they wouldn’t be ordering vessels for some time.

Royal Caribbean Group is the parent company of Royal Caribbean, Celebrity Cruises, Azamara and Silversea. Carnival Corporation is the parent company of Carnival Cruise Line, Princess Cruises, Holland America, Seabourn and five overseas brands.

More Seatrade news: Cruise executives sound off on a U.S. cruise comeback

Cruise ships can take years to build, forcing cruise executives to forecast demand far in the future when ordering vessels. In the past few years, with the future of cruising looking bright, there was a frenzy of orders such as the one placed in January by MSC Cruises.

Now some of those ships may not be needed — at least in the near term.

Still, Fain noted that none of the cruise companies had canceled any of the orders — a sign they see demand for cruises rebounding relatively quickly after the COVID crisis has passed.

Fain noted that COVID-related disruptions at shipyards and their suppliers would result in delivery delays for vessels already on order, leaving less need for lines to order now for far-off years.

More Seatrade news: One cruise line says it may never bring back the buffet

“I think it’s a little early for us to start speculating on what happens (with orders) given the ships that we have on order are already going to take longer to deliver,” he said.

Longer-term, Fain made clear that he expected demand for cruising to grow strongly, resulting in a need for more ships.

“This is not (a situation where) the industry is going to tail off,” Fain said. “I think what you’re going to see is the industry will continue to grow. Once we’re past this crisis, people will see the value of cruising.”

Donald said something similar, noting that only 30 million people in the world take a cruise each year — a small fraction of the 500 million people he said took some sort of vacation annually.

More Seatrade news: This new shore excursion may be the most offbeat ever

“There are plenty of new ships on order, but to be honest with you, they are going to be needed,” Donald said. “There will be demand. There will be need for capacity. Shipbuilding will stay robust in terms of bringing new ships into the global fleets.”

In one more little tidbit of news that came out of the discussion, Del Rio suggested that the next ship order from his company would be for the Regent brand. He noted the company only had one vessel on order for the brand, a sister ship to the recently unveiled Seven Seas Splendor that’s due in 2023.

There currently are six ships on order for the Norwegian brand for delivery between 2022 and 2027. There are two vessels on order for the Oceania brand for delivery in 2022 and 2025.

Planning a cruise? Start with these stories:

Featured image courtesy of Carnival Cruise Line

Chase Sapphire Preferred® Card

WELCOME OFFER: 80,000 Points

TPG'S BONUS VALUATION*: $1,650

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

Apply Now
More Things to Know
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
  • Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
  • With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
  • Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
Regular APR
15.99%-22.99% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.