River & Ocean Cruise - What to expect 2021?
The year 2021 has just started and the uncertainty on where it will lead is felt by companies, owners and for sure by 1 Million crew members normally working on cruise ships. So what do we know up to now and what is being indicated?
River Cruising will start first
River Cruising will start first by operating limited as 75% of cruise guest worldwide are from the English speaking regions ( America, UK, Australia) or Asia and for them it will take longer to be able to return to Europe. A small section are from South America and even though they are small in numbers they are high spenders. They might return earlier than the English speaking regions and shouldn’t be forgotten! A big unknown is the Airline Industry - can they provide transport fast enough again?
First for River cruising will be the European Market lead by Germans, Swiss and all other European countries with short travel distance to the ships. So a good glimpse of hope for Phoenix, Nikko in the lower pay sector and for companies like Mittel Thurgau, Amadeus and other companies that have a mix of nations and agents as frequent guests.
This in turn is bad news for companies like Viking, Ama Waterways, Crystal, Scenic and others which are entirely focused on the English speaking segment. A sure winner before the Corona panic as they made fantastic revenues it will now prolong the wait. The recent announcement from the Australian Health Minister to consider not opening Australia at all in 2021 adds another bad ankle.
New ships will be postponed for sure which will have a long term effect on the ship yards where Bernhard Meyer (Owner Meyer Werft Papenburg, Rostock, Turku) predicted a recovery not before 2030.
Well the CDC (Center of Disease Control - USA) introduced hard measures and Royal Caribbean as first company moved their cruise home port to Barbados to avoid them. Let's see who is following. Viking took of the Norwegian flag of one of their Ocean liners and registered under Chinese flag to start with cruises around China. The Chinese are also buying cruise ships and will start first. A tremendous big market. The rest is still in the unknown.
Covid Measures to be introduced?
Thats a never ending story. Norwegian Cruise line CEO said that they consider asking guest to be vaccinated, Saga Cruise line announcing already that they require guest to be vaccinated - as Quantas Airline in Australia did.. The opinions are split. This might backfire and reduce the number of guest that are willing to book with a company that decides over your body and the vaccine you have to take to be allowed to travel with them. No vaccination passes are available anyway right now - so how to check? And the crew?
So it is fair to assume that Ocean cruising will be earliest May 2021 or later. Which companies will survive? Lates news reported (Cruise Law News Jan 2021) that Executives including the CEO of Carnival and major shareholder in Royal Caribbean have sold Millions of their own stocks. What does this tell us?
Things will continue changing all the time until cruises will operate again. The guest want to come but to reach the numbers of 2019 fast will be impossible. Too many obstacles and the number of reduced ships on offer (30 have been taken out of service up to now) will make it a slow return to normal. 50% business is the absolute maximum we can expect this year - which means 50% of crew will be still unemployed and these are 500.000 Crew members worldwide.
It will depend a lot on Government regulation and who will be when allowed to travel? What documents will be needed? Which borders are open? If I book now will the regulations change until my departure date?
Too many unknowns for 2021 to get the industry going back on track again.
Author: Stephan Busch, Academic Director at the State University for the Humanities Moscow RGGU, Faculty of Tourism & Hospitality and the Swiss International University earned his Master Certificate in Hospitality Management from Cornell University, USA. He has a diverse experience in launching operations, business development and service training- for hotel and cruise companies in Asia, Europe, Canada and Russia.