It’s been almost seven months since Royal Caribbean, along with the entire cruise industry, was forced to pause its operations due to the impact of COVID-19.
Now, as some cruise lines begin to slowly ramp up operations in other parts of the world and as the Centers for Disease Control and Prevention’s (CDC) “No-sail” order is set to expire, the question becomes whether Royal and other lines will be able to start sailing in December.
“Personally, at this point in this unfathomable crisis, I feel more positive that we are beginning to see the light at the end of the tunnel,” Richard Fain, the chairman and CEO of Royal Caribbean Cruise said during the company’s third quarter conference call on Thursday morning. “That light needs more batteries.”
Royal is still waiting on word from the CDC to give the go-ahead to start sailing and Fain and the other executives during the conference call on Thursday were still cautious when it came to the potential restart.
“I don’t want to anticipate any decisions that the CDC might take when the current ‘No-sail’ order expires but I am optimistic…that we are moving in the direction of a healthy return to service,” Fain said.
Fain added that, as the industry awaits the CDC, “they are going through a process that we don’t necessarily see all of,” so it’s difficult to gauge exactly when the decision will come down and what decision it will be.
“It’s a complex subject, and I don’t claim to be the expert on this,” he added.
However, Fain did say that Royal will start slowly when it does restart, with crew trainings geared toward implementing recommendations that it laid out in its Healthy Sail Panel in September.
That panel, which was headlined by Dr. Scott Gottlieb, the former commissioner of the U.S. Food and Drug Administration (FDA). Gottlieb, and former Utah Governor and Sec. of Health and Human Service Mike Leavitt, sent its 65-plus-page to the CDC in September, detailing the best practices that cruise lines should take to protect both their crew members and their guests.
The report makes 74 total recommendations of best practices, including testing, face masks, and new sanitation and disinfection and had CDC observers on-hand each step of the way.
Fain is confident that those recommendations can help Royal and the industry restart in a safe way, creating a “bubble” environment onboard.
When it does get the okay and completes its crew trainings, Royal will then look to start sailing with just a couple of ships on shorter itineraries from U.S.-drive ports with limited shore excursions available for guests.
Capacity and deployment updates
While its North American sailings are still up in the air for December, Royal will start sailing Quantum of the Seas in Singapore in December after receiving permission from that government earlier this month.
Bookings for Quantum have been strong, which shows the pent-up demand for cruising.
When looking to next year, capacity will still be down for 2021—executives on the call said they expect 2021 capacity to be “significantly lower than 2019”—with deployment in the spring focused on short sailings for those key drive markets in both the U.S. and Asia Pacific, including sailings in the U.S. highlighted by stops at Perfect Day at CocoCay.
Demand for 2021 has also been improving. In the last couple months, with very minimal marketing activity, Royal has “seen a steady improvement in bookings,” though they are still below pre-COVID-19 levels.
Since August, approximately 80% of the bookings made are new bookings, Royal said.