Carnival Corp, once a $21 billion company, saw revenue slump overnight last year after the pandemic shut down the cruise industry.
That’s the job of Chief Executive Officer Arnold Donald, navigating waters unknown to the cruise giant that operates nine brands spread across the globe. The company expects to have its full fleet of about 90 ships back by next spring, but regulations aimed at limiting the spread of COVID-19 on board have so far been slow.
Donald is counting on the experienced cruiser to be eager to sail again. However, he acknowledged that the industry is facing a challenge in attracting new followers.
Donald has been CEO since 2013, when he replaced founder Mickey Arison, who remained chairman. The change came after a fatal accident involving a shipwreck off the coast of Italy and an unfortunate voyage known as the Poop Cruise, when the toilets did not flush as the powerless ship swam for days in the Caribbean.
Led by the New Orleans native, Carnival prospered for several years, posting a $3 billion profit in 2019. Then came the pandemic, and the company lost $10 billion.
Donald recently spoke to The Associated Press about his company, the cruise industry, and the intersection of business and politics. Answers have been edited for length.
NS. Can you begin by describing what the pandemic has done to Carnival?
A. It has certainly been disastrous for the travel and tourism sector as a whole and even more so for the cruise industry in particular. Even though we had no revenue, we had to continue manning the ships with minimal manning, so we had a significant burn rate with no revenue coming in.
> How will your company and the cruising industry recover?
A. It is very easy. The demand for travel experience in the global population hasn’t gone away – that demand still is. In a very short span of time, the world has made itself known and developed solution (COVID-19). this is not right. It’s not foolproof, but it allows us to better return to the things we love. We are successfully sailing through the pandemic even before vaccines are over in Europe.
Q. What is the impact of the delta version of COVID-19 on bookings and cancellations?
A. I can’t speak between quarters, but in general I would tell you that as we look ahead, we don’t see major obstacles to Cruise in the future.
> Do you worry that the news of virus outbreaks on cruise ships last year will scare passengers for a long time?
A. For those who haven’t cruised and don’t understand it and don’t know what it is, of course, those images make it hard for us to climb. For people who’ve cruised – and there are a lot of them – we don’t have a problem because they know when you go on a cruise there’s a medical center on board and there’s a doctor and nurse and There are hand cleaning stations. We already have a lot of protocols in place, and now we have extended them to the specificity of the challenge which is COVID-19. Cruisers understand this. They know that ships are not airplanes where people are sitting right next to each other all the time.
> Unlike airlines that received $54 billion in pandemic relief, Carnival and other cruise companies received no federal aid. Is it because you are incorporated in Panama?
A. We are not technically a US corporation, so can certainly influence such a decision. I don’t know why the government did what it did, but it is a logical thought. It would be nice if you could have some help. We have a lot of US employees.
> Analysts (in the FactSet survey) expect Carnival’s revenue to top 2019 in 2023. This sounds optimistic to me. can you do it?
A. We’ll probably have a little bit more capacity… probably going to be a potential environment for stronger pricing. That combination would lead to more revenue. So it is definitely a possibility. We are not giving any forecast right now.
> As CEO, you replaced founder Mickey Arison. You’re in shortly after the Costa Concordia kicked off Italy and the Carnival Triumph swept around the Caribbean with no electricity and no toilets when a fire knocked out the power. how was that?
A. Mickey was not singled out as CEO, which some people were trying to say in the media. That was a big part of the decision to split the role of president and the role of CEO, knowing that we had to focus on some of these areas, with promotions and all that, and other areas of the business that needed additional attention. needed to be given. It was all creative, it was collaborative.
> You are one of the relatively few black CEOs of Fortune 500 companies. When some in the business community rallied against a Georgia law that they said would hurt minority voters, you didn’t play a visible role. Is this a fair characterization?
I try to stay away from politics when you go to parties because we have Democratic guests and we have Republican guests and they both deserve their point of view. But I believe in standing up for things that are fundamentally right, and in that particular case I signed that (a petition opposing the Georgia election law) along with other leaders in the business community. One of the most basic rights in a democracy is the right to vote. We need to do something to encourage people to vote.
> You are 66, you will be 67 in a few months. How long are you going to be in the job?
A. I’ll keep doing it for as long as the board and shareholders want me to do – certainly as long as we get through the rest of this pandemic and get this corporation back on a straight path to financial success with great returns to shareholders.