Richard Fain: Fate of the No Sail Order should not be political

With only days before the CDC’s No Sail Order for cruise ships set to expire, and less than a week before a presidential election in which Florida is a key battleground state, Royal Caribbean Group CEO Richard Fain said he was hopeful that the decision to end or extend the No Sail Order will not be political.

“It’s my strong hope that this is going to be decided on basis of the science and not on the politics,” Fain said.

Speaking to analysts on a third-quarter earnings call, Fain was asked several times what he knew of the CDC’s plans regarding the No Sail Order. He declined to speculate on what CDC officials were thinking, but he did say that the work of the Healthy Sail Panel, the group of experts convened by Royal and Norwegian Cruise Line Holdings (NCLH) that produced a report with 74 protocols recommended to enable the safe resumption of cruising, “should give the CDC a lot of comfort.”

“I think we really made some dramatic inroads with the work of the Healthy Sail Panel,” Fain said. “These aren’t just leading experts in the field; these are the leading experts with the experience of regulating, as well.”

Fain said that the panel’s recommendation that cruise lines conduct “trial trips” prior to commercial sailings is an important part of the return to service a plan “and will be an important point for the CDC — and I’m optimistic that will go well.”

He added that he was optimistic that there will soon be a “pathway back to resuming operations. It will be slower than I would wish, but faster than many are assuming.”

When asked specifically how a Biden administration would impact the CDC’s decision on the No Sail Order, Fain said that he was hopeful that science will determine decisions, “regardless of who’s in power.”

“We’ve worked hard to make sure that the decision is a scientific one,” he said.

He pointed to Europe, where cruises have been able to resume service with limited capacity due to the cooperation between health officials, political officials and cruise lines “trying to solve something that is a problem for all of us.”

“This is a huge issue for employment in this country,” he said. “The cruise industry is an important employer and driver of economic activity. It’s also a respite — and I think it will soon be seen as a respite from the isolation we’re all feeling here.”

Royal Caribbean Group swung to a $1.2 billion loss during the quarter, compared with a profit of $896.8 million a year ago. Revenue was negative $33.7 million; it had reported $3.19 billion in revenue in the same period in 2019.

The company said that while bookings in the second half of 2021 remained within historical ranges, prices are down slightly year-over-year when including the negative yield impact of bookings made with future cruise credits (FCC) and flat when excluding them. In August, the company had reported 2021 pricing was up slightly when the FCC impact was removed.