Cruise Lines fears another lost summer

“I never thought I would spend hours in a food line,” said James Cox, a 50-year-old porter who earns $ 27 an hour in a passenger and their luggage. ‘Just the deterioration of it. You say to yourself, ‘Wow, I’m really at this point.’ ”

Like the rest of the maritime tourism industry, Port Canaveral was plagued at the start of the coronavirus pandemic. A year later, as other parts of the economy come to life again, the U.S. cruise industry anxiously awaits Washington’s prospect of sailing again – and is worried that a second summer season will soon be lost.

Other countries, including Singapore, Italy and the United Kingdom, have allowed cruises or set a clear target date for them to sail. According to the industry’s trade group, nearly 400,000 passengers have sailed since some countries first allowed sailing in July 2020.

But to get started in the US, the cruise industry needs guidance from the Centers for Disease Control and Prevention.

The CDC lifted its no-sail order in October and replaced it with a conditional set of rules; industry officials say the 40-page rules are intangible or impractical, such as a measure requiring cruise lines to perform ‘simulated voyages’ with volunteer passengers.

“I call it the ‘impossible sail order’ because no business can operate profitably,” said Capt. Port Canaveral CEO John Murray said.

The CDC said guidance is coming soon. “Future orders and technical instructions will address additional activities to prepare intersections and return to passenger operations in a way that reduces the risk of Covid-19 among passengers, crew members,” spokesman Jason McDonald said in a statement. said and declined to comment further.

A White House spokesman did not respond to a request for comment.

The order was written before the vaccines were approved, and the CDC did not say whether it would review the guidance for vaccinating crew and passengers.

Without CDC direction, cruise lines could not begin the month-long process of imposing safety measures and recruiting thousands of workers from around the world, industry officials said.

Washington’s hesitation may in part reflect the problems of the cruise industry at the outset of the pandemic.

Cruise lines continued to sail despite known risks of the coronavirus, an investigation by The Wall Street Journal found. Ports denied access to ships carrying passengers who were ill with Covid-19, and giant vessels got stuck at sea.

As the U.S. introduction of Covid-19 vaccines increases, President Biden predicts a return to a sense of normalcy by July. Theme parks, casinos, airlines and hotels all work with restrictions and safety measures, and the cruise industry says it can do the same.

“I hate to speculate, but I think CDC looks at it and feels like, ‘Is this a risk we really need to take? “” Said Brian Salerno, senior vice president of global maritime policy at Cruise Lines International Association, the cruise industry’s largest trading group. “Tilting an industry like this, based on a bad perception, is a lot to ask.”

Participants utilize the vacuum. Hong Kong-based Genting Cruise Lines said in a financial statement on March 12 that Crystal Serenity would begin sailing from the Bahamas in July, disembarking from the United States, but bypassing U.S. and CDC jurisdictions. A week later, Royal Caribbean Group said it would send its own voyage from Nassau in June, thus avoiding U.S. ports.

Alaska cruises face an additional obstacle. Most of the ships are of foreign flag, so they will have to stop in Canada because US law prohibits such ships from transporting passengers between US ports. The problem: Canada banned sailing until February 2022.

About 60% of all visitors to Alaska arrived by cruise ship in 2019, according to a October Federal Maritime Commission report.

The Republican Sens. Dan Sullivan and Lisa Murkowski of Alaska called on the Canadian government to reconsider its ban and enact legislation to allow Alaska-linked cruise ships to bypass Canada. Both plans are based on the CDC, which allows the resumption of voyages.

‘The CDC – best scientists in the world. What they are not designed for is to be a regulator of tourism in America. They are not good at that, ‘said Mr. Sullivan said in an interview. Despite his office’s daily outreach to the agency, he said: ‘they have no answers.’

The pandemic at least temporarily wiped out what was a growth industry. In 2019, about 14 million cruise passengers will leave the U.S., generating a record $ 55.5 billion for the U.S. economy and supporting more than 436,000 U.S. jobs, according to the cruise lines association.

The industry’s ‘Big 3’ – global cruise line operators Carnival Corp.

CCL 2.44%

, Royal Caribbean and Norwegian Cruise Line Holdings Ltd.

NCLH 2.59%

—Got big financial hits.

According to industry and corporate documentation analysts, the companies raised cash with major bond and equity issues, with revenue deepening over the course of 2020. The big three have told investors that they have enough cash available to make the 2022 fishing season.

They also had aggressively incurred expenses, workers left them and in some cases sold older, less efficient ships, which are not as profitable to operate.

Even standing still is expensive. Carnival Corp. told investors in February that they expect to burn an average of $ 600 million in cash per month, just to maintain vessels, maintain corporate operations and invest in preparations to return to the sea.

“There have been extraordinary loans in the industry over the past year,” said Melissa Long, director of Standard & Poor’s, which covers the cruise industry.

The trade group and cross-lines spent $ 4.4 million last year on federal lobbyists, which was the largest investment in the industry since 2008, beginning the last recession, according to lobbying records.

Arnold Donald, chief executive of Carnival Corp., told investors in January that the company and its competitors were in constant communication with federal officials, including the CDC, about the reopening process.

Businesses with vessels, including ports, say they have been trying to draw Washington’s attention to their plight over the past year, by urgent lawmakers and administrative officials.

Trade unions representing dock workers on both coasts say workers have lost hundreds of thousands of hours since the pandemic hit.

In Port Canaveral, Phil Charlton, who has been working in the industry since 1985, took a part-time flower delivery job with his wife, Olivia, also a dock worker. Bob Baugher, who owns hotels and transportation buses in the area, said his businesses lost $ 16 million in revenue last year.

Nearly 5 million passengers passed through Port Canaveral in 2019, which was second only to Miami alone. Many American ports are a mixture of shipping and cargo, but here the cruise side usually makes up about 80% of the revenue.

Now, passengerless vessels pull into the terminal several times a month for inventory and maintenance. None of the crew of the skeleton may go ashore. On a recent March afternoon, the Disney DIS -0.59%

Fantasy inflates some melancholy tribes from ‘When You Wish Upon a Star’ as it passes by Port Canaveral’s Jetty Park.

Mike Horan watches cruise-related Facebook pages for any sign that his moral shuttle service may soon revive.

“This is our port,” he recently wrote on his Facebook page, sharing a photo of a docked ghost ship. “Cruise ships are now just decorations.”

Write to Julie Bykowicz at [email protected] and Ted Mann at [email protected]