In a late-breaking, mid-afternoon announcement, the Cruise Lines International Association (CLIA), the trade association that represents all of the major cruise lines -- and more relevantly, all of the blue-chip cruise line brands owned by publicly traded Carnival Corporation (NYSE:CCL), Royal Caribbean (NYSE:RCL), and Norwegian Cruise Line Holdings (NYSE:NCLH) -- just announced a longer suspension of cruising.
Specifically, CLIA announced that "the association's ocean-going cruise line members will voluntarily extend the suspension of cruise operations from U.S. ports until 15 September 2020."
As the association explained, the U.S. Centers for Disease Control and Prevention (CDC) has already first issued, and then extended until July 24, a no-sail order that requires each of the major cruisers to keep its ships in port until the order is lifted.
The CDC has not yet announced a second extension of its order. Regardless, CLIA observes that "although we had hoped that cruise activity could resume as soon as possible after that date, it is increasingly clear that more time will be needed to resolve barriers to resumption in the United States." Accordingly, deciding that "it is appropriate to err on the side of caution," the association's members say they have extended their suspension of cruises voluntarily. Lending color to the import of the announcement, CLIA notes that each day the cruise industry in America is shut down costs the economy "approximately $110 million in economic activity." The total cost of this additional 53-day delay to the American economy, therefore, would be approximately $5.8 billion.
The cost to cruise companies' stocks is even more immediate. As of 2:05 p.m. EDT, 15 minutes after the news broke, Carnival stock was already down 6.7%, Royal Caribbean 7%, and Norwegian 7.5%.