Coronavirus-hit Princess Cruises to suspend operations

(Reuters) - Princess Cruises, the operator of two ocean liners that were quarantined after they became hotbeds for coronavirus infections, said on Thursday it would suspend the voyages of all its 18 ships for two months.

The suspension upends an industry already struggling with cancellations following the outbreak, and comes after Finland’s Viking Line temporarily paused operations of its river ships and ocean liners around the world.

"Never ... in the 20 years I have served in this company, have we been tested in ways we have been tested over the past 40 days," Jan Swartz, president of Princess Cruises, said on the operator's official YouTube channel, addressing the decision to suspend operations.

“This is perhaps the most difficult decision in our history.”

Shares of parent Carnival Corp, which have already lost over half their value since the start of the year, tumbled a further 18%. Rivals Royal Caribbean Corp and Norwegian Cruise Line Holdings were also down.

Chad Wolf, acting head of the U.S. Department of Homeland Security, commended the two cruise lines’ decisions and called on others in a statement to do the same “until appropriate safety measures are put in place.”

The crisis at Princess Cruises deepened last week after one of its ships, The Grand Princess, was denied entry to San Francisco Bay en route back from Hawaii as authorities learned some passengers and crew had developed flu-like symptoms.

An initial round of testing found that 21 people, mostly crew, had been infected. At least one couple who took the cruise has sued the company, seeking over $1 million in damages for emotional trauma.

Passengers from an earlier cruise to Mexico aboard the same ship had also tested positive for coronavirus.

In February, the company’s Diamond Princess cruise ship was in the spotlight when hundreds onboard were infected in what was then the biggest concentration of confirmed cases outside China. About 700 people onboard were infected and six died.

The suspension set off alarm bells among those responsible for booking cruise holidays.

“We’re playing musical phones trying to get answers from the different cruise operators and airlines we work with ... that’s really what our day-in-day-out life looks like right now,” said a travel agent in Wisconsin who handles bookings for Princess Cruises.

The agent said he still had vacationers interested, however, in booking a Princess cruise in June.

Princess voyages that are under way will carry on as planned, while those that extend beyond Tuesday will be ended at the “most convenient location for guests,” the company said.

Analysts at SunTrust Robinson estimated the suspension would reduce Carnival’s full-year earnings by about 50 cents per share. The company earned $4.40 per share last year.

Reporting by Uday Sampath and Aishwarya Venugopal in Bengaluru; Additional reporting by Makini Brice in Washington; Editing by Saumyadeb Chakrabarty and Peter Cooney