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David Reece and his wife Carolyn should be having cocktails somewhere in the Indian Ocean right now.
But his last vacation on the cruise line was canceled due to the coronavirus outbreak. And they’re missing it: As confirmed cruise vacation devotees, they’ve been to nearly 20 in the past two decades.
For the Plymouth retired couple, it all started by accident. “They sent me to travel agencies to book a cheap vacation in the Canary Islands, and I came back after booking a cruise in the Red Sea,” says David. “Carolyn didn’t speak to me for two weeks.”
But they loved it, and since they’ve traveled the world on cruises; from the Baltic to the Caribbean and from Australia to Brazil.
For them it is the perfect vacation, as David explains: “We had the idea that it was about crossing the Atlantic, sitting on deckchairs with a blanket over our knees. [But in reality], the ships are really mobile hotels, and we wake up in a different place every day … we use it to go to the places we want to see. “
But those floating hotels are now rapidly returning to port, unloading their passengers and being disturbed. The industry has not only been devastated, it has completely stopped working. For this, the coronavirus has been the perfect storm.
It went from being an industry worth $ 46 billion (£ 37 billion) a year, with 26 million passengers per year, to an almost complete overnight stop.
Ironically, the industry was well prepared for the outbreak of disease on board its ships, as has happened many times before, most often with food poisoning caused by norovirus.
However, this time the plan was affected, as Christopher Muller, a professor of hospitality at Boston University, explains.
“The worst thing you can do [if passengers start falling ill] is to keep people on board, “he says.” The plan is to go to the nearest port, get everyone out and then disinfect the ship. “
This usually means that the ship is ready to start sailing again in a matter of weeks, but this time “governments forced them to keep people on board,” adds Professor Muller. “This was not the fault of the industry, normally they would not have done it.”
The problem was compounded by the fact that many modern cruise ships have relatively small cabins, as the economic model of the industry depends on getting as many passengers as possible to spend money on the ship’s spas, restaurants, bars and shops.
The resulting bad publicity, given that passengers were quarantined on board ships in plain view of the shoreline, will be difficult for the industry to shake up.
So will this reverse the rapid expansion of the industry in recent years? The sector certainly has a major problem which means it is likely to suffer more than other parts of the tourism and travel industries, such as the airline sector: it has few friends in high places.
Most cruises are not registered where they do business, in the US. USA And Europe, but on the high seas in places like Panama and the Bahamas.
The industry does that for two reasons: it saves a fortune on taxes and it means they don’t have to follow American or European labor laws. This allows companies to recruit cheap workers from developing countries, pay them less, and work harder.
Now, though, avoiding taxes and hiring cheap foreign workers doesn’t seem so smart: The cruise line industry was not specifically included in the US business bailout plans. USA The industry may be in dire straits, but it is crying in the dark.
And even if governments wanted to help, which they don’t seem to do, as Professor Muller points out: “It is difficult to give a tax exemption if they do not pay taxes.”
Not only that, but many of the destinations loved by their passengers don’t miss out on cruises much, if at all. As Professor Sheela Agarwal from the University of Plymouth Department of Tourism and Hospitality puts it: “No one is willing to rescue them because of their tax evasion, but also because of the negative impacts they have on their destinations … they contribute very little to the economy local “.
Cruises are known to deposit thousands of tourists in crowded cities that, according to Professor Agarwal, “spend very little, look around the place for five or six hours with a packed lunch, and then come back on board for dinner.”
So can the industry recover from this crisis? Well, there are some good signs in the midst of all this sadness.
“Tourists have very few memories,” says Professor Agarwal. “This is like when a terrorist attack affects a destination. Look at the attacks in Paris and Brussels, three months maximum [fall in visitor numbers], and they returned to normal. “
What’s more, it’s pretty obvious what the industry will do as travel restrictions are lifted: They’ll launch a major ad campaign and cut their prices to get customers back. Although, as Professor Muller explains, that will not be painless.
“You have to have these ships quite full to make a profit, you can discount a lot but you have to cover your fixed costs,” he says.
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Fortunately for the industry, oil prices have also collapsed during this recession, and as fuel prices are one of the biggest fixed costs for cruise companies, Professor Muller is sure of one thing: “I can guarantee that they are buying fuel futures like crazy. ”
If David Reece and his wife Carolyn have anything to do with it, the cruise line industry could recover better than most.
He says the ongoing coronavirus outbreak “is not going to postpone us at all.” Instead, he hopes to reschedule his trip “in the next 12 months.”
David adds that he could also look for special offers. “We could go to a last-minute cheat … upon being removed we can drop tools and go at any time,” he says.
Cunard, based in the United Kingdom, part of Carnival, the world’s largest cruise line operator and owner of luxury ships, including the Queen Mary 2, is also confident that the industry will recover.
“We have sailed for 180 years and expect many more,” says Simon Palethorpe, president of Cunard. “We will get through these difficult times together and look forward to welcoming our guests back on board soon, when the time is right.”
David adds that although some smaller companies go bankrupt, ships are unlikely to be wasted, as they are worth billions. “Someone will buy them,” he says.
The industry, it seems, will continue to navigate.