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Carnival CEO defends company's safety record as cruise industry remains grounded

By Helen Coster
Arnold Donald, CEO of Carnival Corp., holds up the company's new Ocean Medallion, a small wearable for their cruise ship passengers, during his keynote address at CES in Las Vegas

By Helen Coster

(Reuters) - Carnival Corp <CCL.N> Chief Executive Officer Arnold Donald defended the company’s safety record on Thursday, telling reporters in a media call that Carnival followed protocols from international authorities while handling high-profile coronavirus outbreaks aboard two of its ships.

On Feb. 3 the company’s Diamond Princess cruise ship was quarantined in the port of Yokohama, Japan, where 712 passengers were ultimately infected in what was then the biggest concentration of confirmed cases outside China. Nine passengers died, according to the CDC.

Another outbreak occurred aboard the company’s Grand Princess cruise ship, which in March was barred from returning to port in San Francisco after authorities learned some passengers and crew had developed flu-like symptoms. The ship was subsequently quarantined: 21 passengers tested positive for the coronavirus and one passenger died.

"With (the Diamond Princess) we did exactly what we were told to do, because we cooperated with the Japanese Ministry of Health," Arnold said.

"We followed their protocol; they decided to hold the ship, they decided to put the quarantine in place. Our job was to respect it and execute it, which is exactly what we did."

On the Grand Princess, Arnold said, "we worked with the CDC, we worked with all the local authorities there -- the governor, the ports, and as everybody figured out what they wanted to do. And we were in compliance with each of them."

On April 9 the Centers for Disease Control and Prevention extended its “no sail order” for all cruise ships for up to 100 days. The cruise industry is currently working on a proposal to submit to the CDC, which will include enhanced sanitization and health safety protocols, according to the industry trade group CLIA.

Carnival’s shares are down 77% since Jan. 1.

At least 138,482 people globally have died from COVID-19 and 2,078,071 have been infected by the novel coronavirus that causes it, following an outbreak that started in Wuhan, China, in early December.

Carnival and other cruise companies are not eligible to receive funding from the CARES Act because they are incorporated outside of the United States.

On Thursday Arnold said Carnival, which is incorporated in Panama, has no plans to re-incorporate elsewhere. He said that he hopes to have some existing debt in Germany, the United Kingdom and Italy extended and to defer the maturities on that debt at this time, as a result of stimulus packages in those countries.

Speaking on CNBC on April 14, Arnold said Carnival’s bookings for 2021 are strong.


(Reporting by Helen Coster; Editing by Daniel Wallis)