COVID-19 testing ‘very likely’ when Royal Caribbean returns to cruising, executive says

Royal Caribbean is considering coronavirus testing as part of its plan to resume sailing, a company executive said during a quarterly earnings presentation Monday.

The company has paused its cruise operations since March and hopes to resume them in November, if the Centers for Disease Control and Prevention lifts its no-sail order, which is set to expire at the end of September. The U.S. cruise industry has voluntarily extended its sailing suspension through Oct. 31. Though company executives gave no firm date for the resumption of cruises, one said testing would be key.

“It’s very likely that testing will occur,” said Michael Bayley, CEO of Royal Caribbean International.He offered no additional details, including whether testing would be for crew members and passengers or to which cruise lines testing would apply.

Royal Caribbean Group owns four cruise brands: Royal Caribbean International, Celebrity Cruises, Silversea and Azamara.

Royal Caribbean canceled 1,545 sailings since March 13, including all of its sailings in the second quarter. The company posted a $1.3 billion loss for the quarter and expects to post a loss for the third quarter and for the year.

One tangible impact: Royal Caribbean Group was supposed to receive five new ships by the end of 2021 but now will take delivery of only three: Silver Moon in October, Odyssey of the Seas, in early 2021 and Silver Dawn late in 2021.

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Royal Caribbean’s Wonder of the Seas was supposed to make its debut next year as the world’s largest cruise ship, but its arrival is on hold indefinitely because of the pandemic.

The ship will be able to carry 6,000 passengers and 2,200 crew members.

Royal Caribbean Group’s fleet includes 62 ships, with another 16 on order.

Jason Liberty, the company’s chief financial officer, said it was looking at selling older ships in the fleet.

“We are evaluating opportunities to sell ships,” he said, while not specifying which ones.

The company reported bookings for 2021 comparable with years past, in a sign that demand for cruising could return. Bayley noted that younger people and loyalty customers were driving sales.

“I’m hopeful we’re going to see a lot of pent-up demand,” he said. “People certainly want to have a vacation next year.”

In the near term, Liberty said, the joint Healthy Sail Panel of Royal Caribbean Group and Norwegian Cruise Line Holdings is looking at every facet of safety, from whether ultraviolet lights can effectively kill the virus to how to improve meal service.

Some of the proposed changes might prove costly, such as whether to modify ships to promote social distancing. And such recommendations could smack into the evolving nature of how to best fight the coronavirus, including how soon a vaccine might be on the way.

The company could resume sailings in China and Australia before November, but executives made no commitments in the quarterly earnings presentation Monday.

Ultimately, the prevalence of the virus would determine when sailings can resume, Liberty said.

“It’s a real puzzle,” he said. “There are so many variables to consider.”

Contributing: Morgan Hines, USA TODAY

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