Cruise ship company Carnival has announced a wide-ranging programme of job losses and pay cuts as it desperately seeks to cut costs in the face of the coronavirus pandemic.
The world’s largest cruise company said it would save “hundreds of millions of dollars” over the course of a year after making the cuts but declined to give details of the extent of redundancies and furloughs.
However, it is thought to affect thousands of workers worldwide. In the UK, Carnival plans to cut about a quarter of its workforce, with 450 job losses expected and 20% pay cuts for those staff remaining. Carnival employed 150,000 people globally before the crisis.
Carnival said it will cut the pay of its chief executive, Arnold Donald, by half this year, with other executives losing a quarter of their pay. All other employees in on-shore operations will have their pay cut by 20%.
Carnival has been forced to stop all of its cruises since early March, when several of its ships became host to serious outbreaks of Covid-19. This is more than 700 confirmed cases on its Diamond Princess ship and 13 deaths.
The company, which also owns the Cunard, P&O and Costa cruise brands, has made “no meaningful revenue” since early March, it said in a statement to the stock market on Thursday.
It comes after other travel companies announced significant job losses. Airlines such as British Airways have already cut tens of thousands of jobs, while Disney has cancelled all of its cruises until at least July.
Ships will start to sail again at staggered dates to adjust to lower expected demand in light of the continued pandemic. It plans to restart some cruises in August.
Carnival said it had delayed job cuts longer than other companies to help employees financially, and that it was still paying commissions on cancelled cruises to travel agents.
Donald said making the job cuts was a “very tough thing to do”.
“Unfortunately, it’s necessary, given the current low level of guest operations and to further endure this pause,” he said. He added that the company “look[s] forward to the day when many of those impacted are returning to work with us”.
Carnival, the only company to be listed in the FTSE 100 in London and the S&P 500 in New York, made the majority of its $20.8bn (£17.6bn) global revenues for 2019 in North America. Europe accounted for just under a third.
Donald said only 38% of its customers had asked for refunds for cancelled cruises, with a majority of those affected opting to sail at a later date.