In an interview with Travel Weekly, Paul Charles, chief executive of travel PR firm ‘The PC Agency’, said he felt confident the cruise sector would “bounce back very fast” next year, as it has historically been “one of the best at dealing with viruses and incidents on board”. However, the financial and reputational damage caused by COVID-19 may hamper this recovery.
The reputational damage caused by COVID-19 will have a long-term impact on how cruises are perceived by the public. Related stories emerging of passengers being confined to small cabins for weeks on end could deter many prospective customers. It is essential that cruise companies address the concerns of the public and have contingency plans in place to stop a repeat of what has been seen during this outbreak. If companies do not respond sufficiently, they risk experiencing severe public backlash, that could take the industry years to recover from.
Charles went on to say that although the industry was “the early whipping boy for coronavirus” due to the high-profile nature of the Diamond Princess outbreak in the early stages of the pandemic, he insisted the sector would recover due to many cruise liners already putting new measures in place to make ships safe and secure.
It is true that a number of stringent health and safety measures are already being put in place. For example, Royal Caribbean is working to develop a four-step program, starting with upgraded screening of passengers before they come aboard; enhanced processes and procedures aboard; special focus on destinations being in compliance; and procedures for dealing with exceptions. The company says it has assembled a team of experts and will only start operating when it is absolutely ready to do so.
These steps are definitely a positive sign. However, according to GlobalData’s Week 10 COVID-19 Consumer Survey, an enormous 80% of respondents globally are still ‘extremely’ or ‘quite’ concerned about the ongoing coronavirus pandemic. This suggests a large number of potential customers will remember the early controversy surrounding the cruise industry. It remains to be seen if the safety procedures put in place will be enough to attract customers once cruising returns on a mass scale.
The financial pressure of COVID-19 is still a major hurdle for cruise liners
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COVID-19 has financially crippled the cruise industry with Norwegian Cruise Line reporting a loss of US$1.9bn and Royal Caribbean a loss of US$1.4bn in Q1 2019, highlighting how much pressure the pandemic has put cruise companies under.
Smaller cruise companies that do not possess the financial reserves of some of the industry’s biggest players will be hit even harder by extended suspensions. It is a very real possibility that if some cruise liners do not resume their operations soon, there could be a number of significant causalities within the market.