Carnival offloads 2 more cruise ships amid COVID-19 cash crunch

Carnival Cruise

 

Carnival Cruise Line is selling two more cruise ships to preserve liquidity during COVID-19, the cruise major said.

The ships in question are Carnival Fascination and Carnival Imagination, which had previously been put on long-term lay-up status.

“The sale of Carnival Fascination, launched in 1994, and Carnival Imagination, introduced in 1995, is in line with Carnival Corporation’s plan to accelerate the removal of less efficient ships from its fleet, “Carnival said.

“This follows the sale of Carnival Fantasy and Carnival Inspiration which took place in July.”

To remind, the company sold the 1990-built Carnival Fantasy and 1996-built Carnival Inspiration for demolition in Turkey in July 2020

Turkey-based EGE CELIK and SIMSEKLER have been selected for the job, as both recycling firms are certified by the Hong Kong Convention for the Safe and Environmentally Sound Recycling of Ships.

“While we are sad to see Carnival Fascination and Carnival Imagination leave our fleet, it is a necessary move as it allows us to focus on ships that offer the greatest variety of features and stateroom accommodations for our guests,” said Christine Duffy, president of Carnival Cruise Line.

Upon return to operations, Carnival Cruise Line will still operate four upgraded Fantasy-class ships – Carnival Ecstasy, Carnival Sensation, Carnival Elation and Carnival Paradise.

The quartet is set to undergo scheduled dry dock enhancements, and the ships will start taking bookings once completed in the first half of 2021.

“This extended pause in our operations has also impacted shipyard availability, and we’ve had to reschedule required dry docks.  As we continue to work through issues related to our eventual return to operations, we are committed to providing our guests and travel agent partners with certainty where we can,” Duffy said.

Carnival Corporation has been hit hard by the suspension of cruising due to COVID-19 impact on the sector

As a result, the cruise liner is planning to remove over 15 ships from its fleet though demolition and sales deals as it works on cutting maintenance costs and curbing the impact of the COVID-19 pandemic on its business.

” As a result of the COVID-19 outbreak, we may be out of compliance with a maintenance covenant in certain of our debt facilities, for which we have waivers for the period through March 31, 2021 with the next testing date of May 31, 2021,” Carnival said in a regulatory filing earlier this week.

The cruise major is working hard to secure liquidity and has announced plans on offering and selling shares of its common stock, worth up to $1 billion, through an “at-the-market” equity offering program.

Meanwhile, the company is preparing for a phased resumption of cruise vacations with specific ships and brands returning to service over time.

The company’s Aida Cruises, Holland America, and Costa Cruises are planning to resume sailing in Europe this October.

Even so, the willingness and ability of people to travel during the pandemic remain low.