Coronavirus Impact: Norwegian Cruise Line May Go Out Of Business
MIAMI (CBSMiami) – Miami-based Norwegian Cruise line is looking for its own lifeline. The company told investors business may be over if a wave of money doesn't come their way.
"The cruise season for the year 2020, at least for the US domestic market, for all intents and purposes is dead," CBS News Travel Editor Peter Greenberg said.
Greenberg says Norwegian and others are doing whatever they can to survive, like borrowing money.
"Norwegian, Royal Caribbean, and Carnival are scrambling to raise capital, tap their own capital markets and credit lines," he said.
Cruise lines don't qualify for bailouts like airlines. As a result, Norwegian is taking similar steps as Royal Caribbean and Carnival to stay afloat the rest of the year.
In March, the Harris Poll found 22 percent of Americans say it'll take a year or longer to take a cruise. One in 10 told researchers never again.
"It's a lot of repeat cruisers who keep the cruise industry going," Greenberg said.
The Greater Miami Visitors and Conventions Bureau sees the uphill battle for business all around. It recently launched Miami Shines. That's a campaign to get locals out when the area reopens and it's an effort to attract tourists.
"When you think about the long shore man on the docks, who are not working now because the cruise ships are sitting idle, we cannot allow the cruise industry to go under," Miami-Dade Chamber of Commerce President and CEO Gordon Eric Knowles said.
Knowles says the possibility of losing a cruise line is a punch in the gut for South Florida.
"When we are talking about the business of the cruise industry, we are talking about the business of restaurants, we are talking about the hotels. When people come down on cruises, they stay for two or three days," he said.
In 2019, Florida Trend Magazine found Norwegian to be the 20th largest public company in the state. It brought in more than $5 billion in revenue and had 30,000 employees worldwide. Some of whom are seeing furloughs and pay cuts. That may continue if the federal no sail order extends beyond the end of July.
"The idea that Norwegian is going to go under is a little remote. But the idea that they may lay off a lot of people if the CDC extends that no sail order is not so remote," Greenberg said.
CBS4 News has not heard back from Norwegian.
