Two postponed deliveries delay more than $1.0 billion payments to Meyer Werft

Postponed deliveries of two ships mean that Meyer Werft, the German shipbuilder, faces a delay in the payment of more than $1.0 billion to its bank account and the company has to seek funding to fill the gap.

The delivery of Iona to P&O Cruises in the UK that had been intended to take place in May, was first postponed to July and it is now hoped that the delivery could take place at the end of August,  Bernard Meyer, head of the shipbuilder said in a video presentation to the company’s staff.

The postponed delivery, resulting from suspension of cruise operations of the Carnival Corporation & plc unit, means that the shipbuilder will not be able to receive the 80% of the contract price that is due to be paid on delivery until much later than originally planned. Consequently, the company has to seek additional short term funding to maintain its liquidity, Meyer said in the presentation to the staff of the company.

Iona has a contract price of USD1.1 billion, according to Shippax Info, the Swedish cruise and ferry industry publication. The amount due to Meyer Werft on delivery would thus amount to $880 million.

Spirit of Adventure, a newbuilding of about 56,000 gross tons for Saga Cruises in the UK, is also nearing completion and Meyer expects to deliver the vessel at the end of September. It was originally planned to be delivered in August. The ship’s contract price is $330 million, according to Shippax Info, of which the 80% due on delivery amounts to $264 million.

The cruise industry has been forced to postpone the commencement of operations, from early summer to late summer in some cases and in the case of the US, until late this year.

As cruise lines do not know when they can resume operations, it has not been possible to conclude talks about new delivery dates of ships they have on order at the shipyard, Bernhard Meyer said, describing the discussions as “complex.”

Dream Cruises to resume operations at the end of July

Genting Cruise Lines announced the restart of cruise operations for Dream Cruises with Explorer Dream operating two and three-night “Taiwan Island-Hopping” itineraries beginning from 26 July 2020, departing from Keelung and calling at Penghu, Matzu and Kinmen islands.

“After months of detailed planning with the authorities to ensure the safety and health of guests and crew, we appreciate the approval of Explorer Dream resuming cruise operations in Taiwan. Dream Cruises will be the first cruise line in the world to begin sailing after the global cruise industry was shut down due to the pandemic,” said Tan Sri KT Lim, Chairman and CEO of Genting Hong Kong.

“Our new standard operating procedures to ensure passenger safety draws on our first-hand experience from the charter of two of our ships in Singapore to house foreign workers and cooperating with DNV GL, the world’s largest classification society, for Explorer Dream to receive the world’s first “Certification in Infection Prevention for the Marine industry (CIP-M),” he continued.

Taiwan is the ideal destination for Genting Cruise Lines to resume Dream Cruises’ operations with the company’s 25 years of history with the island as both a destination and as a homeport and because of Taiwan’s popularity among travellers due to its scenic splendours and friendly citizens. Taiwan’s low numbers of COVID-19 cases compared to global figures has also been lauded by experts as one of the most effective response scenarios in the world.

Due to the success Taiwan has experienced in controlling the pandemic within its borders, the local authorities have taken the proactive step to reinvigorate their economy and open up tourism. To support this endeavour, Dream Cruise will offer special island-hopping cruises calling into the popular ports and islands of Peng Hu, Matsu Island and Kinmen where Taiwanese guests will again be able to enjoy refreshing short getaways on carefree ocean voyages.

“We thank Taiwan for their initiatives to re-start their economy and the tourism industry and the trust they have placed in Dream Cruises. As well, we appreciate the support of the travel industry in the restart of our cruise operations. This is truly a remarkable achievement which was made possible by the Taiwan authorities’ swift and effective handling of the COVID-19 crisis and their foresight in resuming the tourism industry to benefit all the ports, the economy and the lifestyle of the people of Taiwan,” said Kent Zhu, President of Genting Cruise Line.

During the past few months, Genting Cruise Lines has completely re-examined and enhanced all of its health, hygiene and operating protocols to ensure the safest environment for everyone on board including social distancing in dining, entertainment and public areas, 100% fresh air ventilation in staterooms and operations throughout the ship.

Genting Cruise Lines has also worked with DNV GL, the largest classification society in the world, to adapt their hospital “Certification in Infection Prevention (CIP) for the Marine industry (CIP-M). Explorer Dream will be the first cruise ship in the world to receive the CIP-M certification, which will further verify the procedures and systems in place for the proper prevention, control, and mitigation of infection, to protect her passengers and crew.

In accordance with Taiwan’s regulations prior to resuming sailing, Explorer Dream has undergone a thorough deep cleaning and observation of strict quarantine procedures for her crew. The majority of crew will be from other Genting Cruise Lines ships who have been quarantined for the last 3 months and all will undergo a mandatory 14 day quarantine on land after the ship arrives in Keelung on 30 June. Upon negative nucleic acid test results, an additional 7 day isolation period on board Explorer Dream will provide a total of 21 days of exhaustive preventive procedures before operations begin on 26 July.

To safeguard the well-being of guests, stringent health screening processes and guidelines prior to embarkation, disembarkation and social distancing measures on board, as well as thorough sanitization and disinfection and enhanced hygiene practices for guest cabins and crew member quarters, public areas and recreational facilities, along with safe food and beverage handling procedures will be in place.

For example, all of Genting Cruise Lines’ ships allow for 100% external fresh air to be filtered and supplied to each passenger cabin as well as on board public areas ensuring a constant and healthy flow of fresh air throughout the vessels. Isolation wards are available in the Medical Centre and cabins can be converted into quarantine rooms if required.

As a further testament to the efficacy of the company’s enhanced preventive measures, two of Genting Cruise Lines’ ships, SuperStar Aquarius and SuperStar Gemini, are currently in Singapore as temporary accommodations for foreign workers after successfully completing careful assessment checks covering various aspects including safe distancing practices, the ships’ ventilation systems, and preventive and infection control measures. Throughout this successful initiative in collaboration with the authorities, the company has been able to further refine its standard operating procedures within a real-world context to ensure that all its Genting Cruise Lines’ ships, including Explorer Dream, will be the safest cruise ships for guests in the post-COVID era.

Pullmantur to reorganise business under Spanish insolvency legislation

Pullmantur Cruceros, the Spanish cruise operator , has decided to file for reorganisation of its business under the terms of Spanish insolvency legislation in the aftermath of the COVID-19 pandemic, minority shareholder Royal Caribbean Cruises Ltd. (RCCL) said in a statement.

Pullmantur's board of directors determined that the unprecedented impact of the COVID-19 pandemic made the action necessary and its management notified employees of the decision after filings were made with Spanish authorities.

"Despite the great progress the Company made to achieve a turnaround in 2019 and its huge engagement and best efforts of its dedicated employees, the headwinds caused by the pandemic are too strong for Pullmantur to overcome without a reorganisation," the board stated.

The company canceled sailings through November 15, 2020. Royal Caribbean Group said that guests already booked to sail on Pullmantur will be offered the option to sail on other RCCL brands including Royal Caribbean International and Celebrity Cruises. Pullmantur noted that details of the offer will be shared with guests in the near future. Crew are staffed at minimum maintenance levels on Pullmantur's three ships and the company will take care of their safe return home.

The company operates three ships - Monarch, Sovereign and Horizon, all of which are on charter from the RCCL group.

Meanwhile RCCL that has a 49% stake in the company noted that all of its assets related to the Pullmantur Cruceros joint venture had been included in the non-cash asset impairment charge.

CLIA continues voluntary suspension of cruise operations from U.S. ports

Cruise Lines International Association (CLIA) issued the following statement today to announce that the association’s ocean-going cruise line members will voluntarily extend the suspension of cruise operations from U.S. ports until 15 September 2020.

“Due to the ongoing situation within the U.S. related to COVID-19, CLIA member cruise lines have decided to voluntarily extend the period of suspended passenger operations. The current No Sail Order issued by the U.S. Centers for Disease Control and Prevention (CDC) will expire on 24 July, and although we had hoped that cruise activity could resume as soon as possible after that date, it is increasingly clear that more time will be needed to resolve barriers to resumption in the United States.

“Although we are confident that future cruises will be healthy and safe, and will fully reflect the latest protective measures, we also feel that it is appropriate to err on the side of caution to help ensure the best interests of our passengers and crewmembers. We have therefore decided to further extend our suspension of operations from U.S. ports until 15 September. The additional time will also allow us to consult with the CDC on measures that will be appropriate for the eventual resumption of cruise operations.

“This voluntary suspension applies to all CLIA members to which the No Sail Order applied (vessels with capacity to carry 250 persons or more). CLIA member cruise lines will continually evaluate the evolving situation and make a determination as to whether a further extension is necessary.”

Virgin Voyages announces comprehensive health plan for Scarlet Lady

Virgin Voyages, the new lifestyle travel brand focused on delivering irresistible cruise vacations that has raised the bar on boutique design and unique experience, today released its comprehensive ‘Voyage Well’ plan. This industry-leading program delivers innovative health and wellbeing standards to give sailors and crew confidence in the future of cruise travel.

With plans to ‘‘soft open'’ for sailing the brand new Scarlet Lady ship in Oct. 2020, Virgin Voyages has worked with leading experts to elevate its existing standard of excellence by creating an environment built to tackle today’s global health crisis. As one of the newest ships at sea that has not yet sailed with passengers, Scarlet Lady will welcome future Sailors into an environment designed to meet health expert recommendations and sailor expectations before, during, and after a voyage. The Oct. “soft open” plans are reliant on the lift of travel restrictions and Virgin Voyages is staying close to these developments.

The Voyage Well plan was created in partnership with expert advisors consisting of scientists, doctors and clinicians. Referred to as the Voyage Well Expert Advisory Group, this team is composed of partners at AtmosAir Solutions, EcoLab, Dr. Heymann with Vikand, Global Public Health Services, and close collaboration with the CDC as well as frequent reviews of WHO best practices and guidelines.

“The health and wellbeing of our Sailors is our number one priority, so we rolled up our sleeves with leading experts to further innovate and create an even healthier way to travel and still have an incredible vacation,” says Tom McAlpin, CEO of Virgin Voyages. “We appreciate some people will be apprehensive about traveling, so we are committed to being led by science and creating ways to give people confidence to explore the world while feeling safer, more relaxed and free to enjoy themselves.”

On top of a uniquely designed HVAC system that pumps fresh air through the new ship's public spaces and cabins to effectively remove recirculated air, Virgin Voyages will be among the first in the industry to invest in the installation of a 100% fresh air, ‘bow to stern’ air purification system. In partnership with AtmosAir Solutions, Scarlet Lady and her sister ships will be equipped with an air purification system that also disinfects air on board by leveraging bi-polar ionization technology that has been shown to kill 99.9% of viruses. In addition, recent tests performed by Microchem Laboratory, one of the world’s preeminent laboratories for testing EPA- and FDA-registered sanitizing products, has reported that this HVAC device is more than 99.9% effective in neutralizing Coronavirus.

"Delivering effective health and safety measures is going to be essential for ensuring consumer trust in the cruise industry," says Steve Levine, President and CEO, AtmosAir Solutions. "We're proud to partner with Virgin Voyages and believe our bi-polar ionization technology will be crucial to creating a safe, clean and sanitized indoor environment throughout the entirety of the Scarlet Lady."

In addition, Virgin Voyages has developed a comprehensive plan, with key points that work to address all safety standards before, during, and after a voyage.

Key pillars of the Voyage Well Plan include:

– Rapid and effective COVID-19 testing for all Sailors and Crew prior to embarking*
– Post-voyage notification process through which Sailors and Crew can report on becoming unwell within 14 days of leaving the ship* (through an ethical health tracking app)
– Advanced pre-boarding health checks and screenings for both our Crew and Sailors*
– Thermal Camera technology in terminals and on board to monitor our Crew and Sailors’ temperatures
– Fair and flexible booking policies — from moving the final payment dates to 60 days (from 120 days) before sailing, ability to cancel up to 48 hours before and receive a 100% Future Voyage Credit for sailings through December 16th, 2020
– Implementing best practices around sanitation, physical distancing, limited occupancy, and health checks for everyone on board
– Installing the latest technology from AtmosAir Solutions — an air purification system that disinfects air on board. Leveraging bi-polar Ionization technology that has been shown to kill 99.9% of viruses
– Managing overall ship occupancy so appropriate physical distancing is possible across all public spaces
– Leveraging digital onboard technology to limit contact; The Band (for contactless payment), Service Chat (for assistance digitally) and Virtual Queues (for getting in lines for onboard experiences without actually getting in physical lines)
– As has always been a part of the Virgin Voyages experience since first introducing the
brand, there will be no communal food sharing, buffets or large dining halls, allowing for hygienic service of fresh food

*These are paramount and dependent on medical advancements and availability. As technology and science advances, Virgin Voyages will continuously evolve and refine efforts to improve and perfect health and safety standards on board.