(pleasant ambient music)
- [Narrator] This is the
Diamond Princess cruise liner.
In February, the ship
became an early flashpoint
for the coronavirus outbreak.
Passengers and crew were quarantined
as more than 700 of the
estimated 3700 people on board
tested positive for COVID-19.
The now-infamous ship
is owned by Carnival,
the largest cruise operator in the world.
Multiple cruise ships have experienced
a coronavirus outbreak on board,
including several owned by Carnival.
Since the coronavirus outbreak hit,
the number of cruise ships
sailing around the world
has fallen drastically,
leaving the cruise operator
in a precarious position,
but in the face of a pandemic,
health authorities and
passengers are questioning
whether cruise operators can
set sail safely going forward.
(pleasant ambient music)
Carnival began its history in 1972
as a cruise liner with a
single ship, the Mardi Gras.
- Up until then, the
industry was separated.
Small operators doing their own thing.
Carnival was revolutionary
because it made cruising
affordable to people
from every walks of life.
- [Narrator] Carnival
fueled an industry-wide
shipbuilding boom in the 1980s
and branded itself as the
world's most popular cruise line.
The cruise operator went public in 1987,
and throughout the next decade,
acquired or bought stakes
in several cruise lines,
amassing a fleet of over
100 cruise ships today.
- They would compete directly
with the hospitality industry
offering a different product.
- [Narrator] And throughout
the past two decades,
the company has weathered
disease outbreaks.
- We were told by our waiter
that over 200 people had
already been to the infirmary.
- And I was sick for five days.
- [Narrator] As well as natural disasters
and accidents at sea.
In 2012, the Carnival-operated
Costa Concordia
ran aground in Italy.
The accident killed 32 people.
- It was sinking so fast,
and where we were standing
is actually underwater right now,
so obviously, we needed
to get off right then.
- [Narrator] Then, in 2013,
the company hired Arnold Donald
to right the ship as CEO.
Under Donald, Carnival's
market value nearly doubled
to $45 billion in 2017.
- He brought them together
in having a common strategy
of what they offer, applying
a way to control costs
across all those brackets.
Over the past years, the
cruising industry has been adding
at least one million new
passengers every year.
- [Narrator] But in 2020,
coronavirus became a major concern
for the cruise industry early on.
- There are two cruise ships
that have been quarantined,
including the one right
here in Hong Kong behind me
as well as one in Yokohama, Japan.
The fear is that coronavirus is spreading.
- [Narrator] Carnival and
other cruise operators
began canceling voyages in Asia,
but as reports of virus
outbreaks aboard cruise ships
like the Diamond Princess kept spreading,
its parent company
largely continued full
steam ahead into March.
- They were not prepared for coronavirus
because nothing like
this has hit them before.
They could not evacuate
thousands of passengers.
They could not deal with a
rapidly-spreading epidemic.
- [Narrator] The CDC declared
a no-sail order on March 14th
and Carnival's stock price has fallen
through the first few months of the year.
To stay afloat, the cruise
operator has been raising cash
through bond sales and has
furloughed or laid off employees,
and the company's sales revenue
is expected to drop significantly in 2020.
Carnival said it plans to resume
some sailings on August 1st
despite a congressional inquiry
into the cruise operator's
health and safety practices.
- It's a matter of trust,
so it will take a lot of convincing,
a lot of guarantees, and above everything,
some time for the clients to return,
and they're counting
that people's memories
for unpleasant events is short.
- [Narrator] With the
coronavirus pandemic continuing,
what the cruise industry
looks like going forward
remains to be seen.
(pleasant ambient music)
