Game over for Pullmantur Cruises?

[princevaliantus]

After placing ships in cold lay-up, Cruises Investment Holding and Royal Caribbean Group said they have filed for the reorganization of their Pullmantur Cruceros joint venture under the terms of Spanish insolvency laws.

Cruises Investment Holding owns 51 percent of the Spanish cruise line, while Royal Caribbean owns the remaining 49 percent.

It could mark the end of the Pullmantur brand as reports from crew aboard the company's ships said that they are removing equipment and other fixtures.

According to a statement, Pullmantur's board of directors determined that the unprecedented impact of the COVID-19 pandemic made the action necessary.

Pullmantur 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 reorganization," 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 Royal Caribbean 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.

Royal Caribbean noted that all of its assets related to the Pullmantur Cruceros joint venture had been included in the non-cash asset impairment charges reported in their first quarter of 2020 results.

[Ray]

This is going to be a common theme in the next few months in relation to everything not just cruiselines. 

Not every business is going to survive! 

As peoples places of work start to either lay off staff, reduce wages or close completely the domino effect is people spending less as their disposable income is reduced,  things such as going to bars, restaurants or even on vacation wont be a priority or a luxury, the reduced business will result in even more bars, restaurants, hotels and even cruiselines closing their doors for good.

The only upside to this is that if people dont have as much money to waste they may stop buying the Miami Herald  

[monctonguy]

Not surprised...and I expect more to follow...the longer this goes on..even the "big guys" are going to have some issues......

 

And its going to take a few months more to really feel the financial effects of Covid here in Canada..ppl can struggle for a Cpl mths with bills and less pay...but I suspect this fall is going to be brutal for business bankruptcies, business closing and ppl claiming bankruptcy....

 

And if there is a second wave, I really fear for the whole travel/tourism industry as a whole.

[twangster]

We will see more smaller lines that don't have strong financials to carry them forward be impacted like Pullmantur.  

Few businesses can survive very long with no revenue.  Even fewer can survive extended periods with no revenue.

Hopefully Royal can start sailing in some regions around the world soon as a means to realize some revenue.  The name of the game isn't profit at the moment, for now it's simply survival.  

[cruisellama]

Going to be more contraction.  Would expect a shedding of the ships with higher operating/maintenance costs.   Even when we start up again, its not going to be a full fleet.  The loyalists will return, but those who've never sailed are going to stay away a couple of years.