Stick or Twist: Will the CDC Renew No-Sail Order?

Stick or Twist: Will the CDC Renew No-Sail Order?

The U.S. Centers for Disease Control and Prevention (CDC) no-sail order expires tomorrow, September 30, and the cruise industry will be waiting with baited breath to see whether the national public health institute will renew the order for a further period or let it expire, meaning cruises could return soon to North American waters.

The no-sail order was originally put in place in mid-March after several COVID-19 outbreaks onboard cruise ships around the world led to a shutdown of the global cruise industry.

The no-sail order has since been renewed twice, with the last extension coming on July 16. Following the previous renewal, the CDC issued a call for public and cruise industry input on questions related to the resumption of passenger operations about cruise ships.

Among the submissions was a 65-page report handed in on September 21 by the “Healthy Sail Panel” — a team of cross-disciplinary experts assembled by Royal Caribbean Group and Norwegian Cruise Line Holdings  – which concluded cruising can be safe in the current health environment with a robust set of science-backed protocols.

The panel recommends a minimum of one and preferably two preboard negative COVID-19  test results for guests and a minimum of two preboard and one post-quarantine negative COVID-19 test results for crew members, presuming feasibility of rapid testing at the pier. Other recommendations included the use of face coverings and enhanced sanitation procedures on ships and in terminals.

Successful European return to sailing can be an example

Similar protocols have been adopted in Europe where several companies have successfully resumed cruise operations without any outbreak of COVID-19 – among them MSC, Costa Cruises and TUI – although the later this week reported that 12 crew members tested positive and the company’s Mein Schiff 6 returned to the Greek port of Piraeus where additional testing found them negative.

Cruise industry executives have already argued that the European experience can open the way for a return to sailing from North American waters.

Rick Sasso, chairman of MSC Cruises USA, argued during a virtual meeting of senior executives from the world’s four largest cruise lines with the Miami-Dade County Tourism and the Ports Committee in mid-September that: “Our experience to date shows that cruising can be done safely with sufficient planning, protective measures, and then adhering to stringent protocols. NSC has taken this responsibility very seriously and our efforts have been extensive and to help ensure that cruising can offer one of the very safest forms of leisure and travel even in these challenging times.”

The meeting saw executives  – who have seen the values of their companies plummet by an accumulated tens of billions of dollars –  pile pressure on the CDC with the deadline looming for the no-sail order.

CDC discriminating against cruise lines?

‘Enough is enough,” said Frank Del Rio, president and CEO of Norwegian Cruise Line Holdings.  “I want someone to tell me how it’s possible that COVID-19 transmission doesn’t occur on airplanes when you’re sitting four inches away from someone in a middle seat, yet it happens on a ship that is nearly 200,000 tons.

“It is unconscionable what’s happened to the cruise industry. We’ve been quiet for too long…. It’s time to raise our voices. It’s time to let them [know that we are confident of our protocols. We are confident that we can operate safely in this COVID-19 world.

Pressure has also come from cruise and related industry workers, thousands of whom have been left without work in Florida alone as a result of the shutdown.

On Monday, PortMiami workers took to the streets to call on the CDC not to renew the order.  “This is how we eat. This is how we feed our families,” Torin Ragin, the head of the Longshoreman’s Union, said.

Analyst says near-term return, but no-sail order to be extended

But the question is, what will the CDC do come tomorrow evening?

Barclays analyst Felicia Hendrix said earlier this week that she did not believe the CDC would lift the order before the end of the month, but said it may make positive comments on a resumption of operations when it did make an announcement.

“While chances are high (in our view) that the CDC extends the date again (likely into 4Q20), we believe the comments from the agency will be positive and could signal a near-term return to cruise,” said analyst Felicia Hendrix.

Analyst expects that no-sail order will be lifted
Analyst expects that no-sail order will be lifted

Under what conditions will CDC allow return to cruising

CDC officials have said nothing that could give away how they plan to act tomorrow, but we can go back to a statement made when the order was renewed for the first time on April 9.

“The extended Order is in effect until one of the following occurs:

  • The expiration of the Secretary of Health and Human Services’ declaration that COVID-19 constitutes a public health emergency,
  • The CDC Director rescinds or modifies the order based on specific public health or other considerations, or
  • September 30, 2020.”

Let’s take a look at those one by one:

The first clause won’t be happening tomorrow! States across the U.S. are experiencing a second wave of infections, and a vaccine is still a way off, although game-changing rapid testing kits are starting to roll out.

So the question is, will the CDC Director rescind or modify the order, will Europe’s experience be enough to sway the public health institution to allow a resumption of cruising?

As for September 30, that’s tomorrow, and tomorrow we will find out!

Whatever happens tomorrow though, cruising won’t be returning next week as the Cruise Lines International Association has a voluntary suspension in place that currently runs through October 31, and, as Hendrix notes for Barclays, it can take as much as 60 days for cruise ships to transition from cold lay up to being operational.

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