Cruise Industry

Big four cruise lines begin mass layoffs of US staff to cut costs during shutdown

Carnival Corporation, Royal Caribbean and MSC Cruises have announced mass layoffs of staff in the United States.

The moves follow in the wake of Norwegian Cruise Line Holdings, which previously announced furloughs and pay cuts for its US-based office staff.

Carnival Corporation

Carnival Corporation, the largest cruise company in the world, controlling around 47% of the global cruise market, announced on Thursday that it was implementing a combination of layoffs, furloughs, reduced work weeks and salary reductions across the company.

Arnold Donald, CEO of Carnival Corporation

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The measures also affected senior management, with Orlando Ashford, the CEO of Carnival-owned Holland America Line, announcing that he would step down in May. Holland America Line alone has let go some 2,000 US-based employees amid the global shutdown of cruises.

Rick Meadows, President of Seabourn, the luxury cruise line within the Carnival Corporation, announced earlier this month that he would be leaving the company. It isn’t clear if Meadows’ departure is linked to the current layoffs, he is understood to be retiring after a 35-year career.

The various layoffs and pay cuts across all Carnival-owned brands will provide the company with hundreds of millions of dollars in additional cash conservation on an annualized basis, but was described by Carnival Corporation President & CEO Arnold Donald as extremely difficult.

“Taking these extremely difficult employee actions involving our highly dedicated workforce is a very tough thing to do,” he said. “Unfortunately, it’s necessary, given the current low level of guest operations and to further endure this pause.”

“We care deeply about all our employees and understanding the impact this is having on so many strengthens our resolve to do everything we can to return to operations when the time is right,” he added.

Donald said that when operations do resume, Carnival Corporation hopes to re-hire those it has been forced to let go.

“We look forward to the day when many of those impacted are returning to work with us and we look forward to the day, when appropriate, that once again our ships and crew are delighting millions of people at sea,” he said.

Royal Caribbean Cruises

The world’s second-largest cruise company hasn’t given a precise outline of the layoffs and furloughs across its cruise lines, but Cruise Industry News has reported that 521 employees have been let go from the Miami offices of the flagship brand Royal Caribbean International.

Royal Caribbean Cruises has managed to almost half its monthly costs

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Layoffs began on April 24 and will be completed by July 1, according to Royal Caribbean. Among the cuts are 22 assistant project managers, 15 buyers for technical projects, four associate vice presidents, 15 secretaries and four vice president titles.

Larry Pimentel, the President & CEO of Royal Caribbean’s luxury cruise line Azamara resigned in late April, at the same time that parent company Royal Caribbean Cruises announced it was letting go around 1,300 of its 5,000 US-based employees.

“The circumstances of the pandemic made this action unavoidable, and it hurts to part ways with so many good and talented people,” Royal Caribbean Cruises said in a statement.

Norwegian Cruise Line Holdings

Norwegian Cruise Line Holdings, the third-largest of the cruise companies, announced last month that it was cutting salaries and furloughing staff to shore up revenue and reduce costs during the shutdown.

Norwegian Cruise Line Holdings has put 20% of its staff on unpaid leave

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In a memo sent by Norwegian to its staff, the line said the new measures would be in place until June 22, depending on “if the environment improves”.

With cruise lines around the world extending their pause in operations, it’s unlikely that Norwegian will have the resources to return to normal by then, especially as its planned return to cruising foresees a slow start with just five ships across all three of its cruise lines.

MSC Cruises

MSC Cruises is the fourth-largest cruise line in the world after Carnival, Royal Caribbean and NCL, but has so far reportedly only furloughed 128 employees in the United States.

MSC Bellissima at the Abu Dhabi Cruise Terminal – MSC is the fourth-largest cruise line in the world by capacity

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The furloughs include 55 cruise consultants, 10 home-based cruise consultants, five contact center supervisors, eight group advocates and various other titles.

While MSC Cruises has only four ships (MSC Seaside, MSC Armonia, MSC Divina and MSC Meraviglia) operating in the US, it has a worldwide fleet of 19 cruise ships and thousands of employees, but may be partially insulated by its parent company’s diverse economic interests.

MSC Cruises is owned by Mediterranean Shipping Company, the world’s second-largest shipping line in terms of container vessel capacity.

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