Norwegian Cruise Line Holdings Records Quarterly Loss; US Judge Says Florida Cannot Ban Norwegian Cruise's 'Vaccine Passport' Programme
Norwegian Cruise Line Holdings Ltd has recorded a quarterly loss. Norwegian Cruise said that it is seeing pent-up demand for 2022 cruises even as it recorded a bigger quarterly loss. A more than...
Norwegian Cruise Line Holdings Ltd has recorded a quarterly loss.
Norwegian Cruise said that it is seeing pent-up demand for 2022 cruises even as it recorded a bigger quarterly loss.
A more than year-long suspension imposed by US health officials forced cruise operators to raise billions of dollars, with some of them even pledging ships and private islands to stay afloat.
Cruise operators have been sailing from US ports again in recent weeks, with mostly vaccinated guests and crew following lengthy talks with the US Centers for Disease Control and Prevention (CDC).
Norwegian Cruise said that cumulative booked position for 2022 is above record levels and at higher prices.
Rival Royal Caribbean Group said that bookings for 2022 cruises are "practically back" to pre-COVID-19 pandemic levels.
Norwegian Cruise is expecting its monthly cash burn to increase to approximately $285 million in the third quarter, compared with approximately $200 million on average during the second quarter, due to cruise restart-related expenses.
Norwegian Cruise, which is expecting all of its 28 ships to restart operations with guests by April of next year, said its Norwegian Gem ship will sail from Miami on August 15.
The company's net loss widened to $717.8 million in the second quarter ended June 30, from $715.2 million a year earlier.
US Judge Says Florida Cannot Ban Norwegian Cruise's 'Vaccine Passport' Programme
Norwegian Cruise headed to federal court on Friday August 6 in a battle that pitted its plan for returning to the seas against Florida governor Ron DeSantis's vow to oppose COVID-19 "vaccine passports".
As part of Norwegian Cruise's plan to guard against a COVID-19 outbreak, the company will require passengers to prove that they have been vaccinated, but banning anyone who refuses to prove their vaccine status will run afoul of Florida's law.
However, a US judge has allowed Norwegian Cruise Line Holdings Ltd to demand that passengers show written proof of COVID-19 vaccination before they board a ship, dealing a major blow to DeSantis's effort to ban "vaccine passports."
In a preliminary ruling, US District Judge Kathleen Williams in Miami said that Norwegian will likely prevail in its argument that the "vaccine passport" ban, signed into law by DeSantis in May, jeopardises public health and is an unconstitutional infringement on Norwegian's rights.
The judge blocked DeSantis from enforcing the law against Norwegian, allowing the cruise ship operator to proceed with a plan to resume port activity in Miami on August 15. Violations of the law could have triggered a penalty of $5,000 per passenger, potentially adding up to millions of dollars per cruise.
Raymond Treadwill, a lawyer for DeSantis, did not immediately respond to a request for comment.
The ruling comes as big business and some government entities are responding to the rapid spread of the Delta variant of COVID-19 with vaccination requirements, prompting legal challenges from vaccine sceptics and civil libertarians.
"We are pleased that Judge Williams saw the facts, the law and the science as we did and granted the Company's motion for preliminary injunction allowing us to operate cruises from Florida with 100% vaccinated guests and crew," the company's executive vice president, Daniel S. Farkas, said in the statement.
Norwegian has said that Florida's law would prevent the company from ensuring at least 95% of passengers were vaccinated so it could comply with health regulations when it conducts its first post-pandemic voyage from Miami on August 15.
DeSantis has become a national figure for opposing pandemic restrictions, even as the Republican governor's state has become a hotbed of infections and hospitalizations have hit record levels.
He has argued that Florida law prevents discrimination and protects privacy by preventing businesses, schools or governments from demanding proof of immunity in return for service.
Norwegian has said that the law is not about protecting passengers but scoring political points.
Norwegian is ramping up its return to cruises, which the CDC shut down in March 2020 with its "no sail" order.
In order to sail, Norwegian has attested to the CDC that it will confirm that at least 95% of passengers have been vaccinated.
Norwegian said that the law violates the company's First Amendment right to interact with customers and does not prevent discrimination because the company would have to segregate and mask passengers who decline to prove that they are vaccinated.
The state argued that Norwegian could have opted, as rival cruise operators did, to seek CDC approval through a process of running simulated voyages and applying other COVID-19 protocols such as masking indoors.