With the number of coronavirus cases spiking again throughout the country, leisure companies are once again concerned about how the spread of the virus will affect their business.
Cruise lines and airlines have been hit hard during the pandemic, and now Royal Caribbean Cruises (RCL) and Norwegian Cruise Line (NCLH) have contracted a panel of top health advisers to battle the “rough patch” that resulted from coronavirus outbreaks on ships that pushed the industry to a standstill, Norwegian CEO Frank Del Rio said Tuesday.
The two cruise companies, who know competitors in the leisure industry joined forces to establish a joint panel of former public health officials and top epidemiologists to make recommendations to the companies on how to safely return to operations, they announced Monday. The results are also serving as fodder to potentially shift the perspective of the leaders at the Centers for Disease Control and Prevention, which has in the past identified cruising as a key driver of the virus.
“Because of the unprecedented nature of the novel coronavirus pandemic, and the increased risk of transmission of COVID-19 on cruise ships, the US government is advising US travelers to defer all cruise travel,” the CDC says on its website. The CDC said Covid-19 “appears to spread more easily between people in close quarters aboard ships and boats.”
The panel is co-chaired by former Food and Drug Administration Commissioner Dr. Scott Gottlieb and former Utah governor Mike Leavitt, who served as secretary of Health and Human Services under President George W. Bush. Other members of the panel include infectious disease specialist Dr. Michael Osterholm and former CDC director Dr. Julie Gerberding.
“We have been in contact with the CDC. The panel has been in contact with the CDC,” Royal Caribbean CEO Richard Fain told CNBC in an interview Tuesday on “Squawk on the Street.” “They’re well aware of it and they have reacted warmly to it, so I’m actually quite positive that we’re doing exactly what we should do.”
Despite the concerns that cruises might further the spread of the pandemic, Norwegian CEO Del Rio said bookings for 2021 are “remarkable given the circumstances.”
“This gives me great encouragement that people understand that the virus is all around us and the cruise ship is no exception,” Del Rio said Tuesday. “And as soon as we can provide definitive proof that it is safe to go on a cruise, and that’s what the panel’s mission is, they’ll be back.”
For ETF investors who see a brighter future for the cruise lines, The First Trust Consumer Discretionary AlphaDEX Fund (FXD) is a place to look to invest. The fund holds cruise companies like Norwegian and Carnival in its portfolio.
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