Passenger vessels may take $3 billion coronavirus-related hit

The economic damage for the U.S. passenger vessel industry from the coronavirus will be between $2 billion and $3 billion, Passenger Vessel Association (PVA) preliminary estimates show.

PVA, which has asked that the industry be included in the Trump administration’s relief plans, represents 350 passenger vessel operators with about 1,600 vessels who employ thousands of U.S. citizens. The passenger vessel industry face months of little or no revenue.

The trade association, which is still tallying survey results, asked members to estimate their losses in revenue and jobs assuming that they were closed from March 1 to Labor Day. Many have already shut down and laid off workers. Passenger vessel operators are trying to adjust restart dates as the virus continues to spread both physical and economic harm.

American Queen Steamboat Co. on Wednesday extended its suspension of operations through May 16, a month past the April 12 date they originally set to resume service on the rivers. The company has three vessels and a fourth, American Countess, was to be christened in New Orleans April 4.

“Rest assured that our team has the financial resources and resolve to face the inevitable challenges that lie ahead,” said American Queen CEO John Waggoner, in a video message. “I encourage you to join our team’s optimism surrounding the recovery period … and above all else, do not lose faith that this, too, shall pass.”

American Cruise Lines (ACL), the largest U.S.-flag overnight operator with 12 ships, has halted sailings through April 30. The third in its modern riverboat series, American Jazz, is on schedule to debut later this year in New Orleans. “This is an exceptionally difficult time for sure,” said Charles Robertson, CEO of ACL, which has two more new ships due for delivery in 2021. But, he said, “our outlook is still positive,” emphasizing the advantage of sailing small ships close-to-home. Late last month, long before the U.S. outbreak worsened, ACL said it had the strongest start to a key booking season in the company’s history, reflecting growing demand for small ship cruising.

UnCruise Adventures, Seattle, said it’s monitoring the situation daily “and even hourly to determine adjustments to scheduling. … Foremost in navigating these ‘course changes’ are guest and crew safety.” The company cancelled a number of Alaska and Hawaiian Islands cruises through early May.

The Senate passed a $2 trillion emergency aid stimulus proposal late last night and the House will vote on it tomorrow. The bill offered some hope.

“There is a provision for small businesses allowing for emergency loans of up to $10 million, and whatever portion you devote to payroll, that’s forgiven,” said Ed Welch, PVA’s legislative director, who was poring over the legislation.

Also included was a $450 billion Treasury Department fund for loans and loan guarantees for economically distressed businesses and a $25 billion fund for public transit, which could help operators such as the Staten Island Ferry and Washington State Ferries.

About the author

Dale K. DuPont

Dale DuPont has been a correspondent for WorkBoat since 1998. She has worked at daily and weekly newspapers in Texas, Maryland, and most recently as a business writer and editor at The Miami Herald, covering the cruise, marine and other industries. She and her husband once owned a weekly newspaper in Cooperstown, N.Y., across the alley from the Baseball Hall of Fame. A South Florida resident, she enjoys sailing on Biscayne Bay, except in hurricane season.

4 Comments

  1. Avatar

    None of these vessels fly American flags and pays no US taxes also majority of their staff is foreign labor so why bail them out

    • David Krapf

      The U.S.-flagged vessels referred to in this story are U.S. owned, operated and staffed and pay U.S. taxes. Their staffs and crew are U.S. citizens. The vessels cruise the U.S. inland waterways or offer dinner cruises and excursions all over the U.S. These vessel companies are owned and operated by U.S. citizens. Many will also qualify for help under the recently passed stimulus bill. Foreign-flagged cruise lines do not qualify. You are referring to the international cruise ship business. These ships sail under the flags of the Bahamas, Panama and other countries in order to avoid hiring U.S. workers, pay reasonable wages and adhere to more strict labor and environmental standards.

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