As COVID-19 reshapes our economy, our newsletter will help you unpack the news from the day.
Billionaire Micky Arison is having an interesting week. The basketball team he owns, the Miami Heat, just won its second NBA championship in a row. But he also just got pushed out as CEO of Carnival, the cruise company. Carnival’s shaking up its management structure after a series of debacles that hurt bookings this year and the company’s reputation.
A couple of assumptions, from someone who has never been on a cruise:
One, cruise ships should float: which wasn’t the case with the Costa Concordia, owned by Carnival, which wrecked a year and a half ago, killing 32 people.
And, two, cruise ships should have functional bathrooms: which didn’t happen on the Carnival Triumph earlier this year.
“These are really big anomalies,” says Matthew Jacob, an analyst at ITG Investment Research. He says, after the Concordia disaster, “it really caused a good portion of the potential cruising population to reconsider.” He says the Triumph debacle, on the other hand, had fallout that seemed to be localized to the Carnival brand.
Carnival Corporation’s newest earnings report seems to show Concordia is in the rear view mirror, maybe a little more than the bathroomless Triumph is.
Morningstar analyst Jamie Katz says if you look at fleet-wide bookings — excluding the Carnival brand — they were higher and at higher prices, “which indicates the other brands are surviving pretty well.” But bookings on Carnival Cruise branded ships are lower than last year at lower prices.
Which means now might actually be a good time to take that cruise; that, and the fact Carnival says it’ll spend hundreds of millions of dollars to keep passengers safer.
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