Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH) recently received approval from the US Federal Court, allowing the company to resume cruise operations this weekend.
In Norwegian Cruise Line management’s opinion, it is only possible for the company to resume cruise activity by allowing only fully vaccinated passengers and crew members on board. The company faced a problem in Florida (one of the main ports of departure), where it is prohibited to restrict the activities of unvaccinated citizens.
The state’s governor signed legislation last month that will impose a multi-thousand dollar fine on businesses that require vaccination proof. Consequently, Norwegian Cruise Line Holdings Ltd. (NCLH) could not resume operations. Its approach to vaccination control is more stringent. Although a US federal court upheld Norwegian Cruise Line Holdings’ requirement that passengers and crew members be fully vaccinated before they embark.
The two main competitors of Norwegian Cruise Line Holdings Ltd. (NCLH) – Carnival and Royal Caribbean – were also limited in flights, but they provided cruise tours even in the difficult circumstances of the ongoing pandemic.
For example, the testing of unvaccinated passengers was introduced. In addition, tour buyers were required to purchase additional insurance that covers medical costs related to COVID-19 as well as evacuation costs. This method does not work perfectly, and the Center for Disease Control and Prevention had to track 27 out of 63 vessels involved in coronavirus outbreaks in just the last week.
In the case of Norwegian Cruise Line Holdings, a win could set an encouraging precedent for the entire cruise industry. The requirement for full vaccination of passengers and crew, however, may not be sufficient, since illness can still spread in ports when passengers go to ports while the ship travels. Norwegian Cruise Line’s share price is affected by the uncertainty that still looms over the cruise industry. NCLH stock traded at $24.66 on August 9.
