The cruise industry has received yet another blow, this time from Canada
Canada has banned cruise ships for another year, dealing the industry another blow after the Covid-19 pandemic shuttered most sailings for the past year.
On Feb. 4, the Canadian government’s ministry of transportation announced two new interim orders that ban cruise vessels that carry more than 100 people from entering Canadian waters until Feb. 28, 2022, citing a risk to its health care systems.
The measures for cruise ships effectively end the cruise season for ports in Alaska, Maine, and Seattle. That’s because of a US federal law known as the Passenger Vessels Service Act that prohibits foreign-registered ships from sailing between two American ports without stopping at a foreign port. Since most US cruise ships are registered overseas, the Passenger Vessels Service Act means all cruises to Alaska include a stop at a Canadian port. Alaska is an important destination for the industry, trailing only the Caribbean in passenger volume in the Americas.
The Canadian government has also continued to advise its citizens and permanent residents to avoid all travel on cruise ships outside of the country, choking off a significant segment of potential cruise passengers on US ships.
A new setback after a devastating year
The new ban is an additional setback to the cruise industry, which has already canceled most of its worldwide sailings in the past year due to the pandemic. At least 40 ships confirmed cases of Covid-19 onboard, and thousands of passengers have fallen ill or died. By the time the Diamond Princess, which was quarantined in Yokohama, Japan, for weeks, was finally evacuated one year ago, more than 700 people had become infected and at least 10 people died, according to the US Centers for Disease Control and Prevention (CDC). There have also been reports of several suicides after thousands of crew members were endlessly stuck on the vessels and unable to leave after several cruise companies said the repatriation requirements from the CDC were too expensive to follow.
All of this happened during what was supposed to be a landmark year for the industry: More than 117 new ships were expected to finish construction, many of them setting records for size and onboard features. But almost $4 billion of that investment is sitting unused, according to Bloomberg News.
Docked until further notice
Attempts to re-energize the cruise industry have largely stalled, even with offers to extend the use of cruise credits, new cancellation policies, and thousands of passengers willing to volunteer for CDC-ordered test sailings. In December, a four-day Royal Caribbean “cruise to nowhere” from Singapore ended early after a passenger tested positive for Covid-19. Global restart dates for many companies have also been pushed until at least the end of March, with Royal Caribbean saying it won’t sail until May.
These additional delays for voyages, along with concerns about new variants of Covid-19, have pulled down the share prices for Royal Caribbean, Carnival, and Norwegian Cruise Line after they rose from their worst points in December.
A big blow for Alaska’s economy
Canada’s ban on cruise vessels means that ships won’t arrive this year in US cities like Juneau, Alaska, and Bar Harbor, Maine. The order is particularly painful for Alaska’s tourism industry—the northern state’s third largest after energy and fishing—which accounted for more than $4 billion in total spending in 2017, according to the state’s cruise association. Approximately 1.3 million people traveled to Alaska on cruise ships in 2019, according to the Alaska Journal, and that was expected to hit a new record in 2020.
However, the Canadian order on cruise vessels follows the country’s ongoing ban on non-essential travel to and from the US. The wider travel ban started on March 13, 2020, has included fines of up to $500,000 for violations, and helped the country limit its total number of Covid-19 cases and deaths to a fraction of most US states.
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