Cruise Line CEO Says It’s “Crazy” That People Are Booking Cruises

On their second quarter earnings call, Norwegian Cruise Lines CEO Frank Del Rio said,

If you had told me that we were going to be facing these set of circumstances, and your question is, ‘Frank, would you be taking any bookings?’ I would have laughed at you.

I’ll say, ‘Of course, not, who would book? It’s crazy,’”

…But people are booking. People are confident that we’re going to come back. People do want to cruise. They miss it. It’s a heck of a vacation experience, a heck of a vacation value. And so this is temporary. The question is how temporary is temporary.

In the past several days one of the very first ships cruising again had 53 people who tested positive for Covid-19 and an Alaska cruise just had to return to port because of a Covid-positive passenger.

There are some people claiming cruise bookings are up during the crisis but that’s funny math. Still many people will cruise again, and cheap cruise stocks may be worth buying for the cruise discounts alone.

However the idea of cruising before there’s a vaccine seems insane on it’s face, though if you were a vaccine researcher wanting to trade on inside information you’d probably do it in cruise stocks. You can’t insider trade on your company’s stock. However if you’re sure the vaccine is going to work, buy cruise lines. If you think phase three trials aren’t going as well as hoped, short them.

Securities law experts among my readers will tell me if there’s anything problematic with that – a BioNTech or Moderna employee doesn’t have material inside knowledge about Norwegian Cruise Lines… or do they?

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. Some cruise lines have very low special pricing for the Caribbean. MSC has really good pricing everywhere. But here’s the thing, how much of it is new business? Or, are these bookings made with the credits that one receives for a cancelled cruise?

    Most of the lines gave extra credits for the cancelled cruise, but at the end of 2021, if not used, one gets all their money refunded for the cost of the cancelled cruise. If you rebook using the credit, you cannot get your money back if your new cruise gets cancelled. One is only entitled to a new unrefundable credit. Many people do not know that.

    I am sitting on the fence with my credit. But if the virus really gets bad in the fall. I will request a refund. It is a shame because cruising is truly the best value in the travel industry.

  2. I dunno I would have to research it, but that sounds like insider trading to me or at least close to it. The person would be trading on information that is not publicly available. Doesn’t seem like the fact that the stock isn’t for their particular company makes it reasonable to do so. Trading on information which is confidential gives you an advantage over the rest of the trading public, which just raises alarm bells at a first glance. Its an interesting question though.

  3. If I was a medical insurance company I would try to see if there is a way I could deny coverage to people who voluntarily took a cruise during the pandemic. Taking a cruise seems like the most stupid thing somebody could do right now.

  4. Given the SEC’s shocking impotence in this day and age, whether it’s legal or not wouldn’t matter at all. You can get away with it, and that’s all traders ever needs to know.

  5. Banker, not a lawyer…as I understanding it, trading in any security based on non-public information which, once made public, could reasonably be expected to impact the price of that security, can be construed as insider trading. Buying up travel stocks, the Dow, etc now because you are confident in the work of your employer “research/trials seem promisingl”, etc. is probably OK. Doing so while in possession of material non-public information (i.e., specific trial results or forthcoming gov’t approvals) is not.

    There is also the consideration that the information held by a researcher about the vaccine development process is proprietary to his/her employer–using that information for personal gain is potentially problematic as well.

  6. The cruise industry has a veritable army of commissioned salespeople (including bloggers): many people book a cruise not because they want, but because someone who’s bound to make money “convinced” them (not shying away from using lies, as we have all seen) to do so.

    The most ridiculous claim is the one where they provide “value” by comparing “visiting” a place for 2 or 6 hours with overnight stays, the cost of a windowless room with a hotel stay, and omitting all the standard costs that are extra (such as land transport, drinks, decent meals and the “tips” required by the fact that they don’t include a living wage in the cost of the cruise itself).

    Of course, during the pandemic, sellers hawk the “value” aspect even more, omitting from the long list of costs the one of getting or being impacted by Covid.

  7. We have 3 cruises booked for next year. The deals offered were too good to ignore. If there isn’t a vaccine by the cruise dates (March, May and September) we will not go. Simple. Our deposits are refundable. Fingers crossed

  8. Cathy, good luck with getting your money back! Don’t know what cruise line you’re booked with but, we had a cruise in April with Oceania, that of course was cancelled and we did NOT get our money back, just a future cruise credit, which we took and booked one for this coming October, which once again it was just cancelled and ONCE AGAIN, we are NOT being given our money back, just another future cruise credit! The cruise lines are sure making a lot of money holding on to all the passenger’s money oif you ask me! that is robbery in my point of view!

  9. Ampy, if you booked a refundable deposit you will get your money back. It might take up to 90 days but you will get it back. As a travel agent, everyone of my clients, even those on Oceania, got their money back if they had a refundable deposit. Those with non- refundable deposits got a FCC.

  10. I say we use a cruise as a quarantine solution for a few 10,000. People…¿¿¿
    We are tired of being cooped up & we need adventure!!!
    Maybe we should have a nonpostive trip as well

  11. I love cruising and like everyone else my 2 cruises were cancelled. I had the option of a refund, but I decided to book 3 cruises for 2021.
    If this COVID-19 last the entire 2021, most of us won’t be here, so it won’t make any difference. If you are in love with cruising like me get your hopes high. We will have a vaccine by the end of this year or early 2021.
    Keep on cruising!

  12. PLEASE DO NOT PRINT SUCH A MISLEADING HEADLINE. I own a travel agency and your article is a great one, but the fact that many people will only read the headline and think, “See….even the CEO of cruise lines think we shouldn’t book a cruise” does nothing to help the travel industry. Shame on you.

  13. any cruises sailing within the year should be secretly changed into an one way to the bermuda triangle, or to hell.
    the crew can abandon ship a few miles before the end point.

  14. I’ll take a cruise…I’ll waive health insurance…If I get sick I’ll have a cold…Oh no…I guess y’all don’t know that older Americans die every year…If death numbers are up, it’s the additional suicide and drug overdoses caused by an overreaching government…

  15. I have never seen such ridiculous comments. I had three cruises cancelled and not a problem with credits or refunds. Like most avid cruisers, I am hopeful that the new vaccine will be a success and cruising can resume sometime next year.
    Cruising is much more affordable than land based vacations. I know because I travel quite a bit. I usually get a cabin with a large window or balcony, so “windowless” is not a description I would use.
    If people have an aversion to cruising, then don’t go. Simple! As for the rest of us, we will book and be hopeful because not going is NOT an option.❤️

  16. Donna Johnson, we love cruising also and do at least 2 VERY LONG cruises every year. (at least over 28 days) always on a balcony cabin. But, these past 2 cruises that have been canceled they have not given us our money back, and during these times right now, it would really be nice to have that money on hand and not just a future cruise credit! We will cruise again of course, but would prefer to the use of that money right now (we would love to be able to help our sons who are not working at this moment!)

  17. If you booked through a travel agent, I would recommend, leaning on them to call the cruiseline. If you are not using an agent, ( and this is one reason you should) reach out to others that were booked with Oceania via to see if they are having any luck getting their refunds. I received a refund for an April Celebrity cruise, a credit for an August Royal Caribbean and rescheduled a Nov cruise to Nov of next year. Right now nothing is left hanging. I used to be a travel agent, so maybe I just have the right tone on the phone? Make sure you call regularly to check on your refund. Good luck

  18. We did book thru an agent. But because we cancelled our April cruise (due to health reasons) 2 days prior to Oceania cancelling, the will not give us our money back, which I think now for the second time is way beyond ridiculous!

  19. If it was for a covered reason, your travel insurance should have reimbursed you. If you cancelled because of the pandemic, your TA should have advised you to wait for the cruiseline to cancel. Because YOU cancelled , you forfeited $$ back. The cruiseline did you a favor if they offered you a credit, technically, they didn’t have to do that either. I know this seems unfair, but that is what is stated on your cruise contract.

  20. I’ve previously posed the insider trading question to my securities lawyer (who worked in OGC at SEC). The answer was that insider trading is specific to a particular company.

    This also came up in the matter of Enron, when number of Enron executives shorted the stocks (or bought put options ) of/on competitors.

    So, buying cruise stocks just before the vaccine in announced isn’t, as I was advised about the law, isn’t insider trading.

    Of course, one must ask oneself whether the cruise stock will actually go up on the news.
    I wouldn’t bet on it, and if it did I’d be shorting.
    Perhaps that’s why I’m “losingtrader”

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