1 More Knock on the Cruise Line Industry
It may seem like just another international cruise delay for one of Carnival's (NYSE: CCL) (NYSE: CUK) brands. Princess Cruises announced on Tuesday that it will suspend sailings departing from Australia and New Zealand through the end of May.
New Zealand is widely regarded as one of the best countries in controlling COVID-19. It has suffered less than 1% of the deaths per capita the U.S. has experienced. Australia hasn't fared as well as New Zealand, but it has definitely held up better than most major territories. Cases have fallen sharply in Australia since peaking more than two months ago, so why are two of the healthiest countries pushing out new cruises until June?
The reason for the extended pause should be problematic for Carnival investors as well as those with money anchored on smaller rivals Royal Caribbean (NYSE: RCL) and Norwegian Cruise Line Holdings (NYSE: NCLH). Carnival's Princess line is delaying sailings out of Australia and New Zealand as a result of uncertainties about international travel restrictions. If we're still at least seven months away before Carnival feels that it can sail safely from Australia and even New Zealand, are we really going to be resuming operations closer to home in December? The last seven months and change have been hard, and the next few months may not be any easier.
Source Fool.com