The cruise ship industry faces an uphill task to restore confidence among customers spooked by spectacular images of the stricken Costa Concordia flipped on its side and could suffer a major hit to sales in a key booking period.
International
Capsized Cruise Ship Disaster Will Cost Carnival $90 Million
The cruise ship industry faces an uphill task to restore confidence among customers spooked by spectacular images of the stricken Costa Concordia flipped on its side and could suffer a major hit to sales in a key booking period.
Carnival, the owner of the cruise ship that capsized off Italy’s west coast, said it alone expected to take a hit of around $90 million from Friday’s accident just as a result of the boat being out of use for the rest of the year.
“The long-term consequences for the cruise industry could be significant. This accident could have a significant impact in terms of trading because we’re in the peak-season for reservations,” said Natixis analyst Geoffrey d’Halluin.
The first quarter is a critical booking period across the tourism industry and the images are unlikely to encourage holidaymakers already facing tough economic headwinds to opt for a cruise.
“I think it’s going to be horrid, short term,” Numis analyst Wyn Ellis told Reuters. “There will be a definite short-term impact because it’s a key booking period and many people will be put off cruising in the short term.”
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