Cold Layup of Some Ships Acknowledged

[danv3]

Per SEC filing: "The Company’s ships are currently transitioning into various levels of layup with several ships in the fleet transitioning into cold layup, further reducing operating expenses"

 

Unclear if this means RCI or other brands within RCCL family.

 

https://www.sec.gov/Archives/edgar/data/884887/000110465920058425/tm2018985d1_ex99-1.htm

[danv3]

Interestingly, bookings aren't as bad as you might have expected:

 

Prior to the outbreak of COVID-19, the Company started the year in a strong booked position and at higher prices on a prior year comparable basis. Given the impact of COVID-19, booking volumes for the remainder of 2020 are meaningfully lower than the same time last year at prices that are down low-single digits. Due to the suspension in sailings, booking trends reflect elevated cancellations for 2020 and more typical levels for 2021 and beyond. Although still early in the booking cycle, the booked position for 2021 is within historical ranges when compared to same time last year with 2021 prices up mid-single digits compared to 2020.

 

The Company has instituted several programs in order to best serve its guests: for cancelled cruises, guests are offered the choice of future cruise credits valued at 125% of the initial cruise fare paid in lieu of providing cash refunds. As of April 30, 2020, approximately 45% of the guests have requested cash refunds. For non-cancelled cruises, the Company has implemented a “Cruise with Confidence” policy.

 

As of March 31, 2020, the Company had $2.4 billion in customer deposits. This includes approximately $0.8 billion of future cruise credits related to previously announced voyage cancellations through June 11, 2020.

 

The Company also continues to take future bookings for 2020, 2021 and 2022, and receive new customer deposits and final payments on these bookings.

[wolfcathorse]

It makes sense that they  have ships that they can't use because the market isn't open (ie Australia/New Zealand). Too many berths to fill.

[Biker19]

1 hour ago, danv3 said:

Unclear if this means RCI or other brands within RCCL family.

The SEC filing is always for RCCL - without more detail in the filing, it can be any of the brands under the RCCL umbrella.

 

Biker, who assumes Empress and Majesty will be part of the cold layup.

 

 

The Company’s ships are currently transitioning into various levels of layup with several ships in the fleet transitioning into cold layup, further reducing operating expenses

[Sunshine3601]

4 hours ago, Biker19 said:

The SEC filing is always for RCCL - without more detail in the filing, it can be any of the brands under the RCCL umbrella.

 

Biker, who assumes Empress and Majesty will be part of the cold layup.

 

 

I agree with your assumption, I read this filing earlier today and immediately thought of Empress and Majesty since they are heading to Europe to deliver crew home.   I am sure there will be a couple others from Celebrity, etc.

[Merion_Mom]

4 hours ago, Biker19 said:

The SEC filing is always for RCCL - without more detail in the filing, it can be any of the brands under the RCCL umbrella.

 

Biker, who assumes Empress and Majesty will be part of the cold layup.

 

 

 

Poor babies.  😪

[work2cruis]

If as I have heard mentioned, ships will have to go out at reduced capacity for social distancing, what will happen to people currently booked on future cruises(late 2020 or 2021) either before the shutdown or re-booked since then. Will cruise lines have to kick people from their bookings if cruise is near capacity? 

[HBE4]

5 hours ago, Biker19 said:

Biker, who assumes Empress and Majesty will be part of the cold layup.

 

Is it to soon to start speculating which ships might never return to Royals fleet? 

 

When is Grandeur scheduled to be transferred out? With uncertainty as to when Northeast / Mid Atlantic ports  reopen, could her days be numbered?

[ONECRUISER]

10 minutes ago, HBE4 said:

 

Is it to soon to start speculating which ships might never return to Royals fleet? 

 

When is Grandeur scheduled to be transferred out? With uncertainty as to when Northeast / Mid Atlantic ports  reopen, could her days be numbered?

Everything and anything is option or can change now... Heard Bookings in 2021 are up over last yrs, but rates continue to drop over next 18months

[Biker19]

15 minutes ago, HBE4 said:

Is it to soon to start speculating which ships might never return to Royals fleet?

When is Grandeur scheduled to be transferred out?

I think that started the day RCI shut down sailings.

Grandeur is due out in about 11 months.

Edited May 8, 2020 by Biker19

[flyguyjake]

"Finally, a more extreme measure may be a cold lay up, with a ship out of service for several years. Vessel crewing is reduced to the bare minimum for fire, flood and security monitoring. The best berth option for cold lay up would be a cost efficient remote area, preferably in cooler water to limit growth on the hull. Reentering service would most likely require a lengthy stay in a drydock."

[Biker19]

4 minutes ago, Heymarco said:

Probably makes sense as they can’t sell any ships at the moment.

But they can sell cabins on ships which they know will go into cold layup.

[Baron Barracuda]

1 hour ago, ONECRUISER said:

Everything and anything is option or can change now... Heard Bookings in 2021 are up over last yrs, but rates continue to drop over next 18months

 

FCC from 2020 cancellations has to be used by 2021.  So what % of next year's bookings is really new business? 

[shipshape sam]

6 minutes ago, Biker19 said:

But they can sell cabins on ships which they know will go into cold layup.

 I would be ticked if they did  that to me.  I think I might not sail with them.  Also, if done, not the sign of a quality company IMHO.  You would think that good will/ customer loyalty would be paramount right about now to get bookings, you would think.

[Biker19]

3 minutes ago, shipshape sam said:

 I would be ticked if they did  that to me.  I think I might not sail with them.

Start looking for another cruisline - it happens all the time when they keep selling cabins when they are quite certain the sailing will be chartered. Almost all ships are available for booking past June 12, yet we all know they won't sail in June. Same with Majesty, she's unlikely to go back to New Orleans for a long time yet all those sailings are still available.

[Nyc2tropics]

24 minutes ago, Biker19 said:

Start looking for another cruisline - it happens all the time when they keep selling cabins when they are quite certain the sailing will be chartered. Almost all ships are available for booking past June 12, yet we all know they won't sail in June. Same with Majesty, she's unlikely to go back to New Orleans for a long time yet all those sailings are still available.

It’s a Ponzi scheme!! They are using the new booking $$ to refund the cancelled cruises! And I’m sure it’s not only RC but probably all of the cruise lines. 

 

 

 

 

[ONECRUISER]

1 hour ago, Baron Barracuda said:

 

FCC from 2020 cancellations has to be used by 2021.  So what % of next year's bookings is really new business? 

True, but know I've Booked 5 New Bookings myself last 4weeks. Long as prices are low plan another 3-4 this weekend. Other Family Members 2-3 each, all New

Edited May 8, 2020 by ONECRUISER

[toad455]

Clearly Empress would be the first to go. Grandeur is leaving next year. Majesty will be 29 years old in 2021 and would be next to go. With the additions of the Odyssey & Wonder by 2021, RCCL would be up to 25 ships by 2021 if all this happens(Empress & Majesty leaving). Clearly a possibility if they need to cut back. I also wonder if they would delay any new builds(3 Icon-class ships plus a 6th Oasis-class)?

[bouhunter]

14 hours ago, Biker19 said:

Start looking for another cruisline - it happens all the time when they keep selling cabins when they are quite certain the sailing will be chartered. Almost all ships are available for booking past June 12, yet we all know they won't sail in June. Same with Majesty, she's unlikely to go back to New Orleans for a long time yet all those sailings are still available.

It's hard to believe anyone is booking a cruise during the next 3-4 months (or in 2020 at all).  But it sounds like they are.  No sympathy here when those cruises are cancelled.  We moved October 2020 to October 2021.  Have 3 booked in January 2021, even those are questionable.  All were booked long ago for reduced deposits.  No cruise line is getting ANY money from us for quite some time.

 

Everyone should know by now ships aren't sailing for a while, also that they might wait a while for refunds.

 

Edited May 9, 2020 by bouhunter

[nelblu]

If they are taking new bookings in addition to FCC conversion and on top of social distancing protocol, the result has to be extending the date of the FCC usage.   

[zonacruiser25]

WOW!  January, business as usual.  February, Houston we have a problem!  March, OMG the world is ending!  April, now what the hell do we do?  May, lets start throwing things at the wall and see what sticks.  You wonder what kind of contingency plans cruise companies have.  I would find it hard to believe that anyone had a plan to go from gangbusters to done for now in 3 months.  Navies of the world have placed ships in mothballs for years.  Cold lay up would not be as dramatic since it would imply a return to service at some point.  Sadly, it sounds like smaller ships will be the first to go.  I hope that plans are shared as they are finalized so we can start planning with reality instead of watching, waiting and not being able to plan.  At least if we want to plan for 2021 or 2022 we may do well.  Personally, we rarely have cruised with a plan of more than a month or 2 or 3 in advance so we may be in the wait and see crowd.

[island lady]

23 hours ago, Biker19 said:

The SEC filing is always for RCCL - without more detail in the filing, it can be any of the brands under the RCCL umbrella.

 

Biker, who assumes Empress and Majesty will be part of the cold layup.

 

I think you are right.  And probably about now RCI is wishing it hadn't cancelled the sale of MJ or bought back Empress.  😉 

[Ride-The-Waves]

Some thoughts on several of the above posts from an "old retired navy guy and frequent cruiser..."

 

Read somewhere today that 45 percent of monies on 2021/22 cruises are from FCC

 

The "cold layup" is expensive to implement and expensive to return to service which is why a "warm" layup is being used by cruise lines (major machinery running with minimal engineering crew)

 

Cruise lines don't have a clue as to which ports will be available for visits.  Its all speculation at the moment, with the hope that a clearer picture emerges after the current CDC "no-sail" order expires 24 July.

 

CDC has warned of a Phase II pandemic starting in the Fall

 

I expect that all cruise lines are evaluating which ships to use on return to service operations.  Smaller/medium sized ships may be easier to crew and less expensive to operate

 

New builds are being delayed.  Too costly to complete and crew with no money coming in

 

Cruising will return, but it will be different from that which was prior to February 2020.  

 

Irregardless of what CDC does on it's "no-sail" order we will not be cruising this year since CDC directives have become political vice medical.  Next up is a southern Caribbean ABC jaunt in February 2021 on a refurbished ship whose refurbishment has been "postponed."  Not betting on that one either.

[Merion_Mom]

1 hour ago, Ride-The-Waves said:

Some thoughts on several of the above posts from an "old retired navy guy and frequent cruiser..."

 

Read somewhere today that 45 percent of monies on 2021/22 cruises are from FCC

 

The "cold layup" is expensive to implement and expensive to return to service which is why a "warm" layup is being used by cruise lines (major machinery running with minimal engineering crew)

 

Cruise lines don't have a clue as to which ports will be available for visits.  Its all speculation at the moment, with the hope that a clearer picture emerges after the current CDC "no-sail" order expires 24 July.

 

CDC has warned of a Phase II pandemic starting in the Fall

 

I expect that all cruise lines are evaluating which ships to use on return to service operations.  Smaller/medium sized ships may be easier to crew and less expensive to operate

 

New builds are being delayed.  Too costly to complete and crew with no money coming in

 

Cruising will return, but it will be different from that which was prior to February 2020.  

 

Agree.

[shipshape sam]

On 5/8/2020 at 6:07 PM, Biker19 said:

Start looking for another cruisline - it happens all the time when they keep selling cabins when they are quite certain the sailing will be chartered. Almost all ships are available for booking past June 12, yet we all know they won't sail in June. Same with Majesty, she's unlikely to go back to New Orleans for a long time yet all those sailings are still available.

Not sure I will if others are doing it also.  Will though not book anytime soon till have a better sense of Cold layup.