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The Street
The Street
Business
Daniel Kline

Royal Caribbean, Carnival, Norwegian Cruise Lines Get Great News

Before the Covid pandemic, few Americans gave thought to the Centers for Disease Control (CDC). Sure, the name made the news sometimes when there was an outbreak of some sort of deadly or, at least scary, new virus, but the agency had a higher profile in movies than it did in real life.

Covid, of course, changed that and nearly every American came to know the CDC. People who liked to take cruises all grew to know the agency with many taking major issue with how Royal Caribbean (RCL), Carnival Cruise Lines (CCL), and Norwegian Cruise Line (NCLH) were singled out by the CDC during the pandemic.

Because cruise lines don't flag their ships in America, largely to get around American labor laws, the CDC has a lot more power over the industry than it does other forms of travel, Many cruise fans (and almost certainly cruise line executives behind closed doors) lamented the fact that cruises were shut down from U.S. ports for over a year while other forms of travel and lodging had few, if any federal restrictions.

The CDC and the cruise lines have worked together in recent months, but the agency still warned Americans against taking cruises. Now, the CDC has made a big change and that should please executives at (not to mention fans of) Royal Caribbean, Carnival, and Norwegian.

Carnival Cruise Line

What Has the CDC Done for Cruise Lines?

In recent months the CDC has allowed its conditional sail order (CSO) to expire. That was the set of rules the cruise lines were obligated to follow if they wanted to keep their ships at sea. Now, Royal Caribbean, Carnival, and Norwegian operate under a voluntary agreement with the federal agency. 

That deal requires 95% of passengers eligible to be vaccinated are, while the same requirement is made of crews (which are 100% vaccinated on all three cruise lines). Those new rules recently allowed Royal Caribbean, Carnival, and Norwegian to make wearing masks onboard voluntary.

It was progress, but the CDC was still warning Americans to not go on cruises. Now, the agency has finally changed that. It has lowered its risk warning for people taking a cruise to level 2, down from level 4 earlier in the year.

Level 2 is a "moderate" risk while 3 is "high risk" while 4 was "very high risk." A level 1 would be "low risk."

Why Is the CDC's Decision Important for the Cruise Lines?

While the CDC has allowed cruising since July, it basically did so while holding its nose and telling Americans not to do it. The agency never truly acknowledged the steps the three major cruise lines took to mitigate risk for passengers -- which were considerable and involved spending tens of millions of dollars. Now, the CDC has essentially acknowledged these efforts as well as the changing nature of the pandemic.

Royal Caribbean’s senior vice president of hotel operations, Mark Tamis, addressed the post-Covid cruising world on the inaugural sailing of Wonder of the Seas.  "We are back and it’s the greatest vacation and safest there is."

"We’re not saying the return to cruising anymore, because we’re officially back," Matt Hochberg of the Royal Caribbean Blog reported. "We’re back to bold."

The CDC decision may not actually mean much, but it sends a sign to Americans that perhaps the dark days are over for the cruise industry. That could lead to an increase in bookings and people making cruise plans without having to worry about them being canceled by Covid. 

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