Concerned about coronavirus? Contemplating canceling your cruise? Royal Caribbean Cruises Ltd (NYSE:RCL) has you covered.
The rapid expansion of COVID-19 infections around the world is "adding uncertainty to travel plans," said Royal Caribbean Group in a statement today. To help eliminate some of that uncertainty, the cruise line operator says that through July 31, 2020, it will permit passengers to cancel cruises they have booked up to 48 hours before departure.
Royal Caribbean's new "Cruise With Confidence" policy extends across the company's fleet of brands, including Royal Caribbean International, Celebrity Cruises, Azamara, and Silversea. Guests who have already booked a cruise for departure, or who book one in the future (within the time period stated), will be able to cancel up to two days before they sail, and "will receive a full credit for their fare, usable on any future sailing of the guest's choice in 2020 or 2021."
With cancellations generating a credit rather than a refund, Royal Caribbean is characterizing its new policy as a rain check for guests who delay existing vacation plans, but don't cancel them -- or remove them from the company's revenue stream -- entirely.
As such, the effect on the parent company will more likely be to delay revenue than to forgo it entirely. At the same time, Royal Caribbean may garner for itself a measure of goodwill, and maybe even attract a few customers who might choose one of its cruises over cruising with companies that have more restrictive cancellation policies.
Royal Caribbean shares are down 4.6% as of 11:25 a.m. EST.