Royal Caribbean latest to warn of coronavirus profit impact

Image result for royal caribbean ships in china

The wonder of the Seas due for China deployment 2020

Royal Caribbean Cruises has joined larger rival Carnival Corporation in warning of the potential “material” financial impact of the ongoing coronavirus outbreak.

The world’s second-largest cruise company has now cancelled a total of 18 sailings in south-east Asia and also modified several itineraries as a result of travel restrictions in place and “related circumstances.”

The number of cancelled cruises has risen from the eight out of China reported by the company last week.

RCC also reported “softer bookings” across the broader business, not just Asia.

It is in regular communications with global health authorities after China and other countries moved “aggressively” to contain the spread of the virus.

Like other cruise firms, the owner of brands such as Royal Caribbean International, Celebrity Cruises, Silversea and Azamara, has implemented measures to protect passengers and crew.

These include denying boarding to those that have travelled from, to or through mainland China or Hong Kong in the past 15 days and performing mandatory specialised health screenings on at-risk passengers and crew.

The company “is assessing the developments constantly and will update these measures as needed”.

RCC added: “Taken together, these measures have an estimated impact on the company’s financial performance for 2020 of approximately $0.65 per share.

“While not currently planned, if the company was to cancel all of its remaining sailings in Asia through the end of April, it would impact 2020 financial performance by an additional $0.55 per share.

“There are still too many variables and uncertainties to make a reasonable forecast for 2020.

“While the early impact due to concerns about the coronavirus is mainly related to Asia, recent bookings for our broader business have also been softer.

“If the travel restrictions and concerns over the outbreak continue for an extended period of time, they could materially impact the company’s overall financial performance.”

Chairman and chief executive Richard Fain said: “It is important that every organisation acts responsibly, and we have already taken aggressive steps to minimise risk through boarding restrictions and itinerary changes.

“Our shipboard and shoreside teams have been working tirelessly through these circumstances and I want to thank them for all of their extraordinary efforts. We appreciate our responsibility to our guests and to each other, and our focus on public health is unwavering.”

Carnival Corporation, owner of quarantined ship Diamond Princess in Japan after an outbreak of coronavirus on board, was the first to warn of a “material impact” on its financial results.

Sixty-six more passengers on Diamond Princess test positive for coronavirus

Image result for Diamond Princess

A further 66 passengers onboard Diamond Princess have contracted coronavirus, taking the total number of people infected to 136.

The Japanese health ministry confirmed the cases over the weekend and on Monday following further testing.

The ship is believed to be the largest centre of cases outside China.

The new cases are from Australia (four), Canada (one), UK (one), Japan (45), Philippines (three), Ukraine (one) and USA (eleven).

The ship, carrying 2,666 passengers and 1,045 crew, has been placed under quarantine in Yokohama for 14 days with two cruises cancelled.

The line said it was “not unexpected that additional cases would be reported involving individuals who were exposed prior to the start of the quarantine”.

It said it was following guidance from the Japan Ministry of Health on plans for disembarkation to provide medical care for the new cases.

The quarantine end date is February 19 “unless there are any unforeseen developments”, the line added.

Separately, ten guests were taken off the ship for non-coronavirus related medical reasons over the weekend and transferred to local hospitals, the line said.

Image result for Diamond Princess Update from Princess Cruises President .

The line’s president Jan Swartz issued a video statement over the weekend and said the company was working with the Japanese authorities to distribute medication to guests not relating to coronavirus, based on medical priority.

Telephone counselling is also being offered to all guests.

The line said guests will receive a full refund for their cruise fare, including air travel, hotel, ground transportation, pre-paid shore excursions and gratuities.

They will also receive cruise credit to use on a future sailing.

Meanwhile, thousands of passengers who were kept on board the World Dream cruise ship in Hong Kong for four days have been allowed to disembark.

Around 3,600 passengers and crew on the ship were quarantined amid fears some staff could have contracted the virus on an earlier voyage but tests for coronavirus came back negative.

There have been more than 37,000 cases of the virus globally, mostly in China, where it originated, overtaking the Sars epidemic.

The number of people in the UK who have contracted coronavirus has doubled to eight.

On Monday the UK government declared coronavirus a “serious and imminent threat” to public health.

Plea for Help: MSC Splendida Save Your Chinese Crew

With the outbreak of the Corona Virus in China the cruise ship MSC Splendida had to cancel the voyage for guests leaving the crew on board without work at this time. The ship has docked in Nagasaki for 3 days and with the quandary as related to no work for crew members at this time the company appears to have made some drastic decision as related to releasing their Chinese crew members who contracts appear to have been originally set until the end of February as the ship was set to sail to Europe in March of this year. With this, the same said crew members previously made arrangements for their return appropriately without considering the possibility of a nationwide outbreak of the Corona Virus. However, it appears that the ship authorities have informed the same crew members in a last-minute notice that they will be sent back to China with sign off dates earlier than expected and told that they need leave the ship in the following days.

The Chinese crew members and several of their concerned fellow colleagues sent messages to Crew Center with outcry and outrage as related to the disconcern, inappropriate arrangements and lack of empathy for the welfare and wellbeing of the Chinese crew members. Based on the messages received, concerns are related to the ability to utilize international airports, but the inability to assure travel arrangements to the more local destinations of the home hubs of the Chinese crew members. In other words, while the international airports are still functional with precaution measures, it is informed that the more local and national airports are not completely accessible leaving the Chinese crew members potentially stranded without resources and means to assure their return to their final destinations. Furthermore, as many of the Chinese crew members informed they have pleaded and requested to finish their contracts even if not receiving their normal pay in order to assure their health-related welfare and wellbeing as many of their family members and friends have informed of the outbreak affecting the more localized areas.

“Chinese crew feel very sad, feel like they are abandoned by the company now, all we need is just to have a safe place to stay we don’t want to go to dangerous places, even if it’s our country, our home. My father today just told me to try to request and stay on board, because here at home is dangerous. We still can work, even no salary, just keep us safe, enough I just heard from other departments, all the Chinese crew will be sent home.” says one Chinese crew member.

This brings us to the general question as to what is the responsibility of the cruise lines towards their crew members as related to the MSC Splendida in the event of any disaster whether natural, medical or otherwise.

Does the responsibility lie in assuring the wellbeing and safety of the crew members? Absolutely! The responsibility of an employer is to safeguard and protect the employees. As the MSC Splendida is preparing to disembark the Chinese crew members fearing for save passage and travel, as well as their general health and medical wellbeing, the remaining nationalities aboard the ship will not be experiencing the same fear as they will be accompanying the ship back to Europe.

MSC cruise ship at sea

Other cruise lines are following in the lines of safeguarding and protecting their crew members regardless of the cost to the cruise company with a loss of revenue due to no paying guests. For instance, the Royal Caribbean cruise ship Spectrum of the Seas which is also based in Asia for the duration of the outbreak has issued the following notice to its crew members:

“Royal Caribbean Chinese crew members currently onboard due to disembark over the next few days will be offered to stay on board (extend their contracts).” 

With the outreach from crew members, from other cruise companies such as the previously mentioned RCCL ship, who empathize with the Chinese crew members aboard the MSC Splendida report that their experience has been nothing but supportive and positive as the company has taken steps to assure their medical and health wellbeing regardless of the revenue cost and report it as

“Royal Caribbean is looking after its staff on Spectrum of the Seas and try to make the best of the current situation.”

Unfortunately, this is not the experience of the Chinese crew members on the MSC Splendida who report that:

“There is an outbreak of Coronavirus in China and the company just throws us back to a dangerous place. Our home has been blocked we don’t know where we should go after the flight” and “our manager approached us this afternoon, he asked us if we have any airport to go to China. We all cried that we can’t go back since even we back by flight the transportation to home already stopped. Bad news all come that we had our tickets information one by one this evening. We have nowhere to go.”  says one Chinese crew member.

This also begs the question, if the MSC Splendida is ending the contracts prematurely are they also liable and responsible to assure the arrival of their Chinese crewmembers safely to their final destination, as well as what all that would entail? Without a question, the company should have this responsibility and in the event that the crew is prevented to access their final destinations, the company should have the responsibility to assure their lodging and food until able to return safely home.

The Chinese crew aboard the MSC Splendida continue to inform that they feel abandoned by the company without any concern to their safe travel, ability to return to their final destinations and health-related wellbeing. Many reports that they will not be returning to their next contract since there is a great difference in treatment by the company in comparison to other companies. And while the MSC Splendida may be concerned about the loss of revenue due to cancelled cruises and cost that is associated with maintaining the Chinese crew members on board, the cost to the company may be greater as those trained Chinese crew members who have become proficient in working aboard ships with Asian destinations may consider their employment options to other cruise lines.

If we take into consideration past events as related to natural and medical disasters, while operation aboard cruise ships may not be guest-related often major companies such as RCCL and CCL have taken alternative approaches instead of liquidating the crew and sending them to their homes. Case in point as related to the Katrina hurricane which whipped out not only the homes of people in Louisiana and Texas leaving people homeless but also reduced the revenue of RCCL and CCL which cruise ships were porting in those states. However, they yet again made the best of a bad situation by either relocating their crew members on other ships or maintaining them aboard to support local humanitarian forces by providing shelter to locals. And while this was all done in humanitarian efforts, this nonetheless has a similar connotation as related to calling out the MSC Splendida to consider a humanitarian effort as related to the Chinese crew members at this time. We are aware that companies are about money, numbers, revenues, stocks, and so on; however, when is it time for a company to reach into the humanitarian side and consider its crew members not just as numbers, but also as human beings.