Sweden’s only cruise line, Birka Cruises, became the latest industry casualty of the coronavirus pandemic after its parent company Eckerö Group announced Friday that it was shutting Birka down with the loss of over 500 jobs.
The news follows last month’s insolvency of the Spanish line Pullmantur, a joint venture between Cruise Line Holdings and Royal Caribbean. Pullmantur’s three-ship fleet is reportedly headed for dismantling in Turkey.
In a statement on its website, Birka said it was closing down due to “the financial impact of the Covid-19 pandemic’s track that has hit us hard and the entire cruise industry. The uncertainty about how travel will develop has also contributed to our having to make this decision after evaluating all possible alternatives.”
Birka said all passengers booked on its cruises would automatically receive a full refund. The company operates a single ship, the 1,430-passenger Birka Stockholm.
Eckerö Group’s CEO Björn Blomqvist told a local radio station that the business had suffered from weak profitability for a long time and the coronavirus had left it with no option to close down.
Birka Cruise’s CEO Tomas Karlsson added that since the vessel had been forced to stop sailing in mid-March, the company has focused on minimizing costs and looking for a solution. “Unfortunately, we came to the conclusion that this is unfortunately the solution that must be announced,” he told Åland radio.
While the pandemic could well claim more small cruise lines among its victims, the larger cruise lines although hemorrhaging hundreds of millions of dollars a month, say they have enough cash to last for at least several more months without sailing after raising billions of dollars in liquidity.
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