Tough Summer

This has been a tough summer for the cruise lines, hit seemingly by one incident after another. Not only do the lines have ships to fill, with more to come, this summer they also have had to fight a public relations battle, and to their credit, they are winning.

The major incident of summer, of course, was the discovery of Legionella bacteria aboard Celebrity Cruises’ Horizon. In other incidents. a teenage boy drank himself to death aboard Royal Caribbean Cruise Line’s Majesty of the Seas and, most recently, Holland America Line’s Nieuw Amsterdam ran aground in Alaska. In addition, American Family Cruises (AFC) went out of business, sending some travel agents into hysterics over “double talk” and lost commissions, and undermining some of the credibility built up by the industry.

Travel agents meanwhile report that these developments have had no effect on their business. Bookings are up and passengers are cruising.

Focus on Health

While Celebrity Cruises dealt forthright and expeditiously with its misfortune, the incident has focused more attention on the possibility of disease outbreaks on ships.

While the Centers for Disease Control (CDC) finally confirmed 11 cases of Legionnaire’s disease among the passengers of the Horizon and 24 suspected cases, a great deal of uncertainty still surrounds the situation.

Although the CDC seems to have identified the filters in the whirlpools as the most likely source of the bacteria, the CDC is by no means certain. Legionella bacteria is present in many water storage situations certainly not limited to ships, but in most cases do not transmit Legionnaire’s disease. And, the CDC does not know why.

ln the meantime, the regular sanitation inspections of ships are also receiving renewed attention and ships generally come out with high marks.


The drinking incident aboard the Majesty of the Seas has been attributed to the teenager being served alcohol by fellow passengers which they had brought aboard. The ship’s staff has not been implicated.

Still, attention has focused on ships’ security and the need for “policing” passengers. While the incident is an exception to the safety record of the cruise lines, it also focuses on the complex challenge of policing passengers while also pampering them at the same time. As ships get bigger and the passenger demographics get broader, on board security is likely to become an even bigger issue in the future.

Safety at Sea

The Nieuw Amsterdam’s recent grounding in Alaska just averted a major media frenzy as the cruise line was lucky enough to avoid any injuries to passengers as well as avoiding any noticeable oil leak.

The incident serves to bring home the point, however, that cruise ships operate in physical environments that can be hostile. The cruise lines seek to minimize if not eliminate the risk factor by providing their ships with the latest in safety and navigation technologies and by training their officers and staffs.

Still, the odds say that occasional incidents will occur, and transportation industry experience shows that more often than not, human error is to blame. To that end, however, the International Maritime Organization (lMO) and the leading ship classification societies have been working to develop international management codes for the safe operations of ships and prevention of pollution. Thus, in the future, ships’ crews may be “classified” as well along with the ships.

Last year, the Ocean Princess hit a sunken vessel while cruising in South America. While there were no injuries to passengers, the ship was too badly damaged to be repaired. Later in the year, the Noordam collided with a cargo vessel in the Gulf of Mexico which resulted in gash in the Noordam but no injuries to passengers or crew.

1992 saw a number of mishaps, including the highly publicized grounding of the QE2 off the coast of New England; fire incidents aboard the Seabourn Spirit and the Pearl: and mechanical incidents which interrupted cruises on several ships including the Mermoz and the Regent Sun.


The cruise lines have cleaned up their acts dramatically in the last few years and those who were once described as offenders and are now often cited for their efforts.

Still, accidents can happen. Earlier this year, the Golden Princess was linked to an oil spill in Alaskan waters where Princess Cruises put the responsibility squarely on the shoulders of the Swedish company that owns the ship and is responsible for maritime operations.

The Coast Guard reportedly caught Palm Beach Cruises’ Viking Princess in the act so to speak off Southern Florida, and fined the company heavily.

Going Out of Business

In the last several years, the few companies that have gone out of business have mostly been expedition style operators including SeaQuest Cruises which ended operations last September.

While there have been consolidations and companies have been absorbed by larger, stronger organizations, in the last several years travel agents and the public have largely been spared companies going into bankruptcy.

While it is unlikely that other companies will go under there are signs that some are struggling and if any company should go under it would have a negative impact on the industry as a whole.

While AFC is going out of business, it has not gone under so to speak through bankruptcy: hence all financial obligations will be met. This may seem like little consolation to travel agents who have booked passengers and will lose commissions unless they can rebook those passengers on other cruises. In any event, they will have to do twice the work for the same amount of pay.

However, anyone can surely appreciate the orderly departure of AFC. Thus, there has been no negative impact on the industry. In fact, AFC’s demise has hardly been the subject of any news coverage outside of Florida media and the travel trade press. Even here the coverage seems to have been short-lived.

Agents, however, may become more wary of booking with small companies and certainly with stan­ up operations.

In the last 10 years, only three cruise lines have actually filed for bankruptcy, American Cruise Line; Exploration Cruise Line; and Aloha Pacific Cruises. Other projects were short-lived such as Club Sea; yet others, some of which were broadly publicized, simply have not materialized.

Other companies have instead been acquired by larger, stronger organizations. Thus, the track record suggests there is every reason to have confidence in the future of the cruise industry.

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