In recent weeks this has been the much-misquoted version of what US President Franklin D. Roosevelt really said in his 1933 inaugural address. What he actually said was, “So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself, nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.” Close but no cigar!
If you read this again however, it is the, “… unjustified terror which paralyzes needed efforts to convert retreat into advance” line that is arguably most pertinent to what we are experiencing with the ‘fearful’ rise of COVID -19, aka novel coronavirus.
In the US, spotty and often contradictory reporting at national and local levels on what to expect from this looming plague, have mixed in with conflicting, often politically tainted, statements from the White House to fuel rather alleviate the public’s fears. Stampedes of panicked buyers flooding stores big and small to snatch up a year’s supply of toilet paper and hand sanitizer, hardly help the calmer shopper who next week will find the shelves bare.
As usual, the travel industry is one of the first business segments to feel the pinch – or maybe in this case it’s more of a pummeling than a pinch. There is something tragically ironic about the fact that fuel – usually the airline industry’s biggest single cost factor – dropped in price by almost 40% in the last couple of weeks. Having your fuel bill drop is great news but it’s a little damped down when you are processing way more ticket refunds than new bookings.
To that end, in recent days Air Canada and WestJet both announced identical (go figure!) “temporary” refund rule revisions that allows travellers booked on flights beginning on or before March 31 to change their reservation without the usually applicable change fees. Perhaps the policy makers at both carriers have been listening to Trump’s assertions that the whole thing is a media-driven “hoax” that will blow over in next to no time. March 31 is only a couple of weeks away, so such a tiny booking window for penalty-free cancellations would seem to be forestalling rather than addressing the looming storm.
In the US Delta, led the way by waiving its change fees through April 30th and the others have mostly followed suit with minor variations. Obviously carriers that have suspended service to Italy, South Korea and the like are offering full refunds for closer in trips.
The airline industry will rebound – it always does. But the travel sector that might be hit a lot harder and for a lot longer however is undoubtedly the cruise business. As is to be expected, the Grand Princess virus that went viral has spawned headlines like, “Will the coronavirus outbreak sink the cruise industry” from the Los Angeles Times.
It’s certainly an industry that has had more than its fair share of ‘troubles’ over the years: Everything from terrorists pushing wheelchair-bound passengers overboard, to Legionnaire’s disease, to the Costa Concordia running aground and sinking within camera-shot of the coast of Italy in 2012. Then there was the Carnival Triumph floating powerlessly in the Gulf of Mexico after an engine fire … okay enough already – but you get my point.
It’s also an industry that has been sailing on a tidal wave of success in recent years. As the same LA Times article relates, “The outbreak comes after five or six years of growing profits and bookings for the cruise industry. Before the outbreak, it was a predicted that 32 million passengers would sail on cruise ships worldwide in 2020, up from 30 million in the previous year.” It went on to say that, “To meet the increasing demand, the world’s cruise companies were scheduled to launch 19 new ships in 2020, for a total of 278 cruise ships registered as members of the Cruise Lines International Association.”
The article then sited an example of The Majestic Princess, operated by a subsidiary of Carnival Corp. It features 1,780 cabins, 19 decks, an atrium and nearly 1,100 square meters of luxury boutiques, representing the largest shopping space at sea. Sadly, this magnificent vessel is now docked in Singapore, with its next 13 cruises cancelled.
Just this week, my old buddy Sir Richard Branson welcomed the arrival of Virgin Voyages brand spanking new ship the 2,700-passenger Scarlet Lady in its homeport of Miami. If indeed, “timing is everything”, I suspect Richard might have prayed to the great Sea God Poseidon – reputed to be a bad tempered SOB at the best of times – to have dealt him a better hand.
Well on the “every cloud …” front, at least Boeing is off the hook. Nobody has written a word about the 737 MAX for at least 10 days now!*
But maybe FDR’s 1933 speech throws some hope into the current viral depression: Addressing the ‘Great Depression of the 1930’s, he went on to say, “In every dark hour of our national life a leadership of frankness and of vigor has met with that understanding and support of the people themselves which is essential to victory. And I am convinced that you will again give that support to leadership in these critical days.”
Amen to that.
* Editor’s note: Our Mr Tait was not privy to today’s article on AC cancelling its Max order when he wrote that!
Editor’s Note II: This column was written before last night’s speech from the Oval Office. You probably guessed that – but David wanted to be sure you did.