Wednesday is looking like a good day to own cruise stocks, with the Cruise Lines International Association -- CLIA, the primary trade organization for the industry -- releasing a statement urging the Centers for Disease Control and Prevention "to lift the Framework for Conditional Sailing Order (CSO) and allow for the planning of a phased resumption of cruise operations from U.S. ports by the beginning of July."
In 11:45 a.m. EDT trading, shares of Carnival Corporation (CCL -0.15%) (CUK -0.24%) are up 5.2%, Norwegian Cruise Line Holdings (NCLH -0.56%) is gaining 4.2%, and even Royal Caribbean (RCL 0.31%) has tacked on 3.7%.
As you'll recall, it was back in November that the CDC first issued its "Framework," requiring that cruise lines do the following before letting any passengers get back on board their ships:
- Prepare "adequate health and safety protections for crew members"
- Set up "laboratory capacity to test future passengers"
- Conduct a series of "simulated voyages"
- Obtain "COVID-19 Conditional Sailing Certificates"
Only then could the cruise lines resume sailing out of U.S. ports.
Since then, it's been mostly crickets from the CDC, and no "Conditional Sailing Certificates" have actually been issued.
Now it seems CLIA is finally running out of patience. In today's statement, CLIA president Kelly Craighead points out that "over the past eight months, a highly controlled resumption of cruising has continued in Europe, Asia, and the South Pacific -- with nearly 400,000 passengers sailing to date in more than 10 major cruise markets. These voyages were successfully completed with industry-leading protocols that have effectively mitigated the spread of COVID-19. Additional sailings are planned in the Mediterranean and Caribbean later this spring and summer."
So far, fewer than 50 cases of COVID have been reported aboard the cruise lines that have resumed, notes CLIA, a number that "is dramatically lower than the rate on land or in any other transportation mode." Additionally, "the accelerated rollout of vaccines is a gamechanger," and "President Biden expects all adults will be eligible for vaccinations by May 1, 2021."
We've heard no response from the CDC yet, but cruise investors clearly seem encouraged by CLIA stepping up and urging the agency to let cruise lines get back to business. And you can be sure we'll update you as the situation progresses.