Cruise operators

Cruise operators took a deep bruising from COVID-19, but history says they will recover – MSN Money

This article is part of a series tracking the effects of the COVID-19 pandemic on major businesses, and will be updated.

The cruise industry was among the industries rocked hardest by the COVID-19 pandemic, with many fearing the virus could leave a permanent bruise on a sector with a history of onboard illness outbreaks. But it’s exactly that history that suggests this time won’t be different, and cruising will eventually flourish again.

Cruise operators have a number of variables to worry about during non-outbreak periods, including fuel costs, weather, the economic cycle, fluctuations in foreign currency rates, foreign port availability, the limited number of usable shipyards, and regulatory restrictions.

Throw in a disease outbreak, much less a global pandemic, and it’s easy to question why anyone would get into the business.

“What has been demonstrated time and time again, from various outbreaks and epidemics, is that people have a short memory.”

— Dr. William Lang, chief medical officer of WorldClinic and former director of the White House Medical Unit.

As an example of the risks to cruise company’s business, the “risk factor” section of S&P 500 index component Royal Caribbean Group’s

latest 10-Q quarterly filing is 14 pages long. In comparison, the risk factor section in the latest 10-Q of Apple Inc.
is less than half a page.

Royal Caribbean’s second-quarter revenue plunged 94% from a year ago, while fellow S&P 500 component and cruiser Carnival Corp.’s

revenue for the quarter ended May 31 tumbled 85%. Neither company has responded to a request for comment.

What has been demonstrated time and time again, from various outbreaks and epidemics, is that people have a short memory.

Take 2019 as an example. Even after a year that saw a shipyard accident that reduced the earnings outlook, a gastroenteritis outbreak, a Trump administration ban on cruises to Cuba, worries of rising fuel costs after an attack on a Middle East oil refinery and a negative earnings effect because of Hurricane Dorian, Royal Caribbean’s stock still managed to reach a record close on Jan. 17.

The stock has tumbled 47.5% year to date through Friday. Carnival shares have shed 66.1% this year, while the S&P 500

has gained 8.6%.

This difficulty in running the business can be viewed as a positive, because it raises the barriers to entry. But more important, like the hotel industry, cruising satisfies a couple of basic human wants, to be social and to get away, and it does both at the same time. This not only encourages customers to forget outbreaks, it also makes them very loyal.

Don’t miss: COVID-19 hit the hotel industry hard. Here’s how hotels are pivoting in the new reality.

Dr. William Lang, chief medical officer at WorldClinic and a former director of the White House Medical Unit, said it’s important to separate the cruise industry from the rest of the travel industry during the current COVID crisis. A cruise ship is “substantially different” than a dry land environment, he said.

Add to that the possibility of being trapped at sea, if another onboard outbreak occurs. But that hasn’t stopped people from taking cruises after disease outbreaks in the past.

“What has been demonstrated time and time again, from various outbreaks and epidemics, is that people have a short memory,” Lang told MarketWatch.

Although an element of fear will likely drive down bookings for future cruises in the near term, given uncertainties over the duration of long-term effects of the COVID-19 virus, “that will pass,” Lang said. “People will tend to forget about it. It’s a time-limited phenomenon on cruises.”

Unknown unknowns

One problem with expecting an eventual rebound, is how can you do that before you even know when cruise ships can start sailing again?

What makes the cruise industry different that others in the travel business, is that the U.S. government’s Centers for Disease Control and Prevention (CDC) has direct control over when ships can set sail.

Last month, the CDC announced the extension of its “No Sail Order” through Sept. 30. But that doesn’t mean cruises will depart the day after. The CDC said its order followed data showing there were 99 outbreaks of COVID-19, or COVID-like illness cases, on 123 cruise ships during the period of March 1 through July 10.

Don’t miss: Cruise stocks fall as CDC extension of no-sail order could be just the beginning.

“Now, since the crisis began, we extended our suspension of operations seven times, now through Oct. 31 for most voyages,” said Royal Caribbean Chief Executive Richard Fain in a call with analysts on Aug. 10. “But it’s fair to say there is still a lot of uncertainty.”

Carnival’s Italy-based cruise operator Costa Cruises is planning to gradually restart operations on Sept. 6, but its Holland America line is extending its halt on cruises through Dec. 15.

Despite all this concern and uncertainty, the customers remain loyal. Royal Caribbean has said bookings for 2021 are “trending well,” and are within historical ranges, and Carnival said it “continues to see demand for new bookings for 2021,” despite a substantial reduction in marketing.

Cruise companies are considering many changes in how passengers are boarded and to the onboard experience, to make their guests feel safer. Dr. Andrew Coggins, Jr., a professor at Pace University’s Lubin School of Business, said cruises will be cleaning more, reducing capacity, spacing out the restaurant, beefing up the filtration systems and using ultraviolet cleaning tools.

The buffet, a longtime favorite of cruisers, may “go away altogether.”

As WorldClinic’s Dr. Lang says, buffets are a great way to pass viruses and other respiratory diseases. But he said that’s an easy fix for a cruise line, as it can move from an open buffet to a cafeteria-like line, or a conveyor belt that passes trays past different food stations.

“Those are just examples of what can be done that don’t significantly change the experience, but can allow for decreased risk of exposure,” Lang said.

Another way to reduce the risk is to use technology to help disperse people throughout the ship, even before they gather.

Nadir Ali, CEO of Inpixon, an indoor intelligence company, is working with cruises and hotels to do just that. The Inpixon app works like a Waze GPS for an indoor environment, as it allows cruise operators to manage density by showing where the traffic is, and allows users to avoid crowded walkways and eating areas.

“People are going to get out of their homes, [so] how do you make them feel safe?” Ali said in an interview with MarketWatch. “You provide technology that allows people to see where you are and where you’re going.”

Like other industries using technology-based solutions to make a post-COVID world more contactless and efficient, guests will probably start to like using it, and miss it when they can’t: “Safety may be the driver, but it certainly becomes a convenience tool,” Ali said.

Read also: ‘It’s unlikely we can prevent widespread transmission of COVID-19 between students if our undergraduates return to campus’: College students on an unusual fall semester.

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Cruise Norwegian

36 crew on Norwegian cruise ship test positive for Covid-19 – CNN

(CNN)Thirty-six crew and four guests on a Norwegian cruise ship have tested positive for Covid-19, the cruise company says.

All 158 crew members from the MS Roald Amundsen have been tested after four staff became ill and were found to have the disease on Friday, according to a statement released Saturday by Hurtigruten, the owner of the ship.
“None of the 154 crew members still on board the ship — including the 32 new confirmed positive tests Saturday — has shown any signs of disease or symptoms of Covid-19,” it said. “Four guests have tested positive. The ship is currently docked in Tromso, Norway, with no guests on board.”
The four crew members tested positive Friday after being in isolation for several days for showing “other disease symptoms” but none associated with Covid-19, according to the statement. They are in a hospital in Tromso.
The ship was scheduled to sail to Svalbard, a Norwegian archipelago north of Norway, on Friday afternoon. That trip has been canceled.
Guests from two expeditions are now self-quarantining in line with Norwegian regulations, Hurtigruten said.
“The safety and well being of our guests and crew is Hurtigruten’s number one priority,” Hurtigruten said in the statement. “All crew members are closely monitored and screened daily.”
Hurtigruten VP of Global Communications Rune Thomas Ege said the company was “focusing all available efforts in taking care of our guests and colleagues” and would be “working closely with the Norwegian national and local health authorities for follow-up, information, further testing and infection tracking.”
The MS Roald Amundsen had two expeditions to the Arctic, one on July 17 with 209 guests, and another on July 24 with 178 guests on board.
On July 27, the European Maritime Safety Agency issued guidelines for the resumption of cruise ships in the European Union and countries in the European Economic Area. It states that “cruise operators need to ensure that cruises do not pose unacceptable health risks to passengers, staff and the general public, in particular when compared to other types of package holiday.”
It recommends enhanced cleaning, keeping physical distancing of at least 1.5 meters, and the use of face masks if physical distancing cannot be maintained.
Hurtigruten said its non-Norwegian crew members are quarantined before boarding, and non-European crew need to undergo two negative Covid-19 tests before leaving their home country.
According to John Hopkins, Norway has reported more than 9,200 confirmed cases of Covid-19 and 255 deaths.
The country first confirmed cases in February and introduced lockdown measures the following month, including the shutting of its borders to most foreign nationals and the closure of schools and universities.

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Cruise working

NASA working with Tom Cruise to film movie on the International Space Station – Spaceflight Now

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Tom Cruise in “Top Gun: Maverick.” Credit: Paramount Pictures

NASA said Tuesday it is working with Tom Cruise to film a movie on the International Space Station, but details on the arrangements are scarce.

The news that Cruise was in talks with to shoot an action-adventure film on the space station was first reported Monday by Deadline, which said the actor is working with SpaceX on the project.

NASA Administrator Jim Bridenstine tweeted Tuesday that the agency is “excited to work Tom Cruise on a film aboard the space station. We need popular media to inspire a new generation of engineers and scientists to make NASA’s ambitious plans a reality.”

Cruise, the 57-year-old star of Top Gun and the Mission: Impossible film franchise, has performed daring stunts before. NASA did not confirm Tuesday whether Cruise would himself fly to the space station as part of the film.

SpaceX has not confirmed its role in the film project, but Cruise could fly to the space station on the company’s Crew Dragon spaceship. The Crew Dragon is designed to carry up to four people to and from low Earth orbit, potentially room enough for Cruise, a small film crew and a professional astronaut in command.

Elon Musk, SpaceX’s founder and CEO, tweeted Tuesday: “Should be a lot of fun!”

NASA last year said it would enable private astronauts to spend up to 30 days on the International Space Station. The paying passengers would fly to the station on SpaceX’s Crew Dragon spacecraft or Boeing’s CST-100 Starliner crew capsule, the two human-rated spaceships developed by U.S. industry in partnership with NASA.

Private companies would pay for access to the orbiting research outpost, and the commercial companies would be responsible for funding the flight’s launch and trip to the space station.

The International Space Station viewed in 2018 from a departing Soyuz spacecraft. Credit: NASA/Roscosmos

Earlier this year, the space tourism company Space Adventures — which arranged the flight of Garriott and other wealthy passengers to the station on Russian spacecraft — announced an agreement with SpaceX to fly paying passengers on a Crew Dragon spacecraft without going to the space station. Instead, the Crew Dragon contracted by Space Adventures will fly on its own in Earth orbit, reaching altitudes hundreds of miles above the space station to provide passengers a more expansive view of Earth.

Axiom Space said in March that it signed a contract with SpaceX to ferry a professional astronaut and three paying passengers to the International Space Station as soon as next year.

Deadline reported Monday that the film project is “real” but in the “early stages” of development. No studio is attached yet to the film, Deadline reported.

Cruise narrated the 2002 IMAX documentary film Space Station 3D, which was filmed by astronauts during the assembly of the International Space Station. A short science fiction film named Apogee of Fear was filmed on the space station in 2008 by Richard Garriott, who paid for his trip to orbit on a Russian Soyuz spacecraft.

But celebrity spaceflights and past plans for filmmaking projects in orbit have faltered before reaching the launch pad.

Singer Lance Bass of NSYNC began training to fly on a Soyuz mission to the space station in 2002, but his sponsorships fell through. A Russian actor hoped to fly to the Russian space station Mir in 2000, but the project collapsed due to lack of funds.

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Follow Stephen Clark on Twitter: @StephenClark1.

If you would like to see more articles like this please support our coverage of the space program by becoming a Spaceflight Now Member. If everyone who enjoys our website helps fund it, we can expand and improve our coverage further.

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