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Alaskans Losing Most from Cruise Ban, U.S. Federal Maritime Commission Report Says
Ketchikan, Alaska (Photo: Brian Lasenby/Shutterstock)

Alaskans Losing Most from Cruise Ban, U.S. Federal Maritime Commission Report Says

Alaskans Losing Most from Cruise Ban, U.S. Federal Maritime Commission Report Says
Ketchikan, Alaska (Photo: Brian Lasenby/Shutterstock)

October 21, 2020

Cruise Critic
Staff
By Cruise Critic
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(5:50 p.m. EDT) -- A report issued by U.S. Federal Maritime Commissioner Louis E. Sola concluded that, "when considered on a per capita basis, there may not be another state in the Nation paying as high a cost from passenger ships not sailing than Alaska."
The latest in a series of in-depth assessments into the impact of the cruise industry's shutdown on the U.S economy, the report notes that the cancellation of the entire Alaskan cruise season because of the COVID-19 pandemic has disproportionately affected Alaskans, as many state towns are heavily dependent on cruise tourism.

"While tourism benefits all our Northwestern states, it is one of three pillars of the Alaskan economy," noted Commissioner Sola in his findings. "Passenger cruising is a vital part of the Alaskan tourism business and the loss of an entire cruise season has led to the loss of revenue for a disproportionate number of Alaskans."

Alaska's economy relies primarily on energy, fishing and tourism. Cruise tourism has been a huge growth segment for Alaska, with arrivals increasing 45 percent between 2010 and 2019.

Two Times the Population of Alaska Cruised There in 2019

Skagway, Alaska (Photo: Ruth Peterkin/Shutterstock)
Commissioner Sola's report states that twice as many people from outside the state as the number of those who actually live in Alaska took a cruise there in 2019. With the suspension of the entire 2020 Alaskan cruise season, economic activity for 1.3 million people was wiped out for the entire year.
"Under the best of circumstances and in any other state, there would be no disguising the consequences of losing that much revenue," noted Sola. "In Alaska, in the context of the cruise industry, the consequences are greatly exacerbated."
The Commissioner's report mirrors the comments made by Andrew Cremata, borough mayor for Skagway, during a panel on the state of the Alaskan cruise industry held as part of the virtual Seatrade cruise conference.
"This is about survival for Skagway," said Cremata, speaking of the importance of having a successful 2021 cruise season. Cremata noted that the cruise industry makes up roughly 95 percent of the town's overall revenue.
"The only thing that's relevant is being ready when the cruise ships arrive," said Cremata. "If that requires wearing 30 masks over our face before we engage the cruise ship passengers, I intend to be wearing 30 masks."
During the initial days of the COVID-19 pandemic, there was some optimism that Alaska could see a partial cruise season this year.
Those hopes were dashed, however, with the continued extension of the U.S. Centers for Disease Control and Prevention (CDC)'s "No-Sail Order", which has been extended multiple times and is currently valid through October 31 as of this writing.
Transport Canada's ban on cruise ships from entering Canadian waters or ports of call has also had a devastating effect on the industry. Many Alaskan cruises depart roundtrip from Vancouver, and those leaving from Seattle typically call on a Canadian port like Victoria or Prince Rupert to satisfy the U.S. Passenger Vessel Services Act.

More Than Just Individual Passenger Calls

Wilderness Adventurer
Cruise lines make other contributions to the local economy aside from passenger spending and individual visitor calls. Cruise companies in Alaska employ thousands of local staff in the state and spend close to $300 million on goods procured from Alaskan companies.
Cruise operators also contribute to a variety of state taxes and fees, including the Commercial Vessel Passenger Tax, the Commercial Passenger Vessel Environmental Compliance Program, and the Ocean Ranger Program.
This is in addition to both passenger and crew spending ashore. Jobs -- from longshoremen to local pilots, dock agents, tour operators and retailers -- are at risk every time a vessel does not call.
"If there is no cruise ship in port, landside tour companies have no clients," writes Commissioner Sola. "In major metropolitan areas with major seaports, there will more likely be other opportunities for people to pursue while they wait for cruise ships to begin operating again.  In many places in Alaska, the cruise business is the local industry."
In the end, despite rigorous proposals and health and safety measures, no operator was able to get their 2020 Alaska season off the ground. In the case of UnCruise Adventures, a presumptive case of COVID-19 shut down the line's entire season before it even started.
"It just killed us," UnCruise Adventures' owner and CEO Dan Blanchard told Cruise Critic over the summer. "Small businesses like ours have taken a considerable hit during COVID, and this was a big one. We have taken proactive steps and understand our responsibility to our guests, crew, communities and the industry."

Lines Commit to Alaska in 2021

Compare: 12 Cruise Ships in Alaska (Photo: Holland America Line)
While the outlook for the 2020 Alaska cruise season was devastating, the forecast for 2021 is more optimistic.
Holland America Line has committed six ships to Alaska for next year, sailing from Vancouver, Seattle and Whittier. It plans to bring its Land+Sea cruisetours to Anchorage, Fairbanks and Denali National Park back, in a healthy and safe manner.
Other cruise lines, including Princess, Royal Caribbean and Celebrity, have made little to no changes to their Alaskan deployments for next year. Princess, however, did cancel all 2021 Alaska calls scheduled to take place aboard Sun Princess, as that vessel was transferred out of the fleet in September.
Still, there has already been a reduction for next year. Cunard Line has elected to keep Queen Elizabeth operating out of the UK for 2021 instead of Alaska, and gradual operational restart plans throw the spotlight on how many vessels will actually sail to Alaska next year.
"While the 2020 season is lost, there is hope for the 2021 season," concludes Commissioner Sola.  "The men and women who are government officials, port executives, and tourism leaders know what is at stake and are doing what they must to limit their losses and welcome back cruise passengers."
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