Royal Caribbean Group is seeing an increase in bookings as the company nears the one-year mark without any cruises in the U.S., its biggest market.
Despite U.S. cruises being banned indefinitely, on Monday Royal Caribbean Group executives said the company has seen a 30% increase in future bookings since the start of the year compared to November and December. Royal Caribbean Group has canceled all U.S. cruises until at least May.
The booking increase is a bright spot in an otherwise bleak business update. The second largest cruise company in the world reported a net loss for the fourth quarter of 2020 of $1.4 billion, or $6.09 per share, compared to a net income of $273.1 million, or $1.30 per share, during the fourth quarter of 2019. It was Royal Caribbean Group's fourth straight 10-figure quarterly loss
To cut costs, the company has divested of five ships — three of them through the recent sale of the Azamara cruise line. Still, Royal Caribbean is operating at about a $250-290 million monthly cash burn rate for its existing lines: Royal Caribbean International, Celebrity Cruises and Silversea. One of its ships, Quantum of the Seas, is operating with passengers in Singapore.
So when will U.S. cruises be up and running again? It's too soon to say, according to executives.
"We are really in an interim period where the vaccines are still relatively new," said Chairman Richard Fain. "They're coming out amazingly quickly, but it will take months to get huge numbers of people vaccinated. We and the CDC and governments around the world are looking at how that will change [cruising]. We don't have answers yet."
Last year, Royal Caribbean Group hired a panel of health experts, including several former staff of the U.S. Centers for Disease Control and Prevention, to come up with protocols to safely cruise during a pandemic. Subsequent guidance from the CDC, part of requirements cruise companies must meet before they can start operating again, outlined stricter testing.
Now that the COVID-19 vaccine is in play, those protocols will have to be altered, said CEO of Royal Caribbean International Michael Bayley.
"As we continue to see infections decline and vaccinations increase, we're going to move to some sort of protocol that is a hybrid of vaccine and testing," he said.
The company is still waiting on the next phase of technical instructions from the CDC governing agreements between companies and ports to avoid the chaos that played out last spring when ports turned away cruise ships carrying infected and dead passengers and crew.
"Our dialogue is productive," said Bayley of conversations with the CDC. "They've assured us that when these indicators start to move in a positive way, they'll start working with us to get us back into operation."
Last week Royal Caribbean Group announced it will be requiring all crew members to be vaccinated before cruises restart. Bayley said that the company surveyed 70,000 crew members about this last week, and received 32,000 responses in the first few hours; 98% of respondents so far have said they are in favor of the vaccine mandate for crew and 4,000 have already been vaccinated in their home countries.©2021 Miami Herald. Visit at miamiherald.com. Distributed by Tribune Content Agency, LLC.