It was another difficult day for the cruise industry yesterday, ranging from the official declaration of a Global Pandemic by World Health Organization to unconfirmed reports that the industry and the U.S. government are discussing the possibility of denying boarding to anyone over 70 years, unless they are able to present a doctor's note verifying their fitness to travel.
That prospect was reported by CNBC, Cruise Week says, but there’s no confirmation to date.
Given these developments and rumors, cruise stocks once again plunged. For the day, NCLH closed down 26.7%, and is now down 74% for the year. RCL dropped 14.1%, and is now down 67% for the year. CCL closed down 9.4%, and has now dropped 57% for the year.
On the positive front, Morgan Stanley issued a report indicating that the publicly-traded cruise companies have a sizeable buffer in regards to liquidity issues.
Meanwhile, updated reports from various cruise sellers interviewed during the past days by Cruise Week paints a pretty grim picture of the state of the industry.
One top seller said, "Cancellations continue through the roof, because so many people are scared and now they can cancel and get a future cruise credit."
However, he said the policies are absolutely necessary, explaining, "It's the right move because cruise lines have to find a way to decrease the fear of something happening on their cruise."
Another top seller said, "Our daily bookings year over year are down more than 50%. And since we were up 10% before the start of coronavirus, it's really a 60% drop."
Cancellation figures vary widely from agent to agent. However, the figure most being quoted is somewhere between 35% to 45% over the last several weeks. "If there's 100 new bookings, that means we have 35 cancellations the same day," said one seller.
Whatever the business model, people are hurting. "Nobody has the staff to keep up with all the requests, so service levels are terrible," said one local seller. "We're absolutely buried."
Finally, looking ahead, given the coronavirus situation in Italy, the summer Med is now facing greater challenges even though the prime cruise season doesn't start until May.
As Cruise Week Correspondent Art Sbarsky points out, "Italy is the absolute centre of the Mediterranean market with Greece to the east and Barcelona to the west. So many itineraries touching Greece or Barcelona include Genoa, or Rome or Venice or Naples."