Global cruise ship fleets lose US$4 billion in value as coronavirus pandemic idles industry, halving the number of vessels at sea
- A total of 483 vessels were collectively valued at just over US$167 billion in the first quarter, according to a report by VesselsValue
- Vessels that are currently being built are depreciating in value even before they hit the water
Cruise ships, which can cost upwards of US$1 billion each, have begun to fall in value as buyers and investors shun the once-lucrative industry that has lost its appeal amid the Covid-19 pandemic.
The global cruise ship fleet comprising 483 vessels has collectively lost US$4 billion in value to just over US$167 billion at the end of the first quarter, shipping data provider VesselsValue said in a report on Tuesday.
“As long as the virus persists and the vessels cannot trade, cruise companies and stakeholders will continue to lose vast sums of money,” said Guy Cooper, an analyst with VesselsValue.
According to VesselsValue, even ships that are being built at the shipyards are depreciating. It noted that Royal Caribbean’s €1.1 billion (US$1.2 billion) order for a 231,000 gross tonnage vessel placed with French shipbuilder Chantiers de L’Atlantique in 2019, is now valued at €1.03 billion, losing 6.4 per cent in value in a year.
VesselsValue bases its valuations in part on commercial use. Unused ships lose value and desirability among potential buyers. Cooper estimated that a large, 6,000-passenger vessel would have a normal operating cost of US$1.1 million per day.
