Carnival Cruise Accident Could Shipwreck Industry
The cruise ship accident off Italy's coast could sink more than the boat as Carnival's shares fall almost 20 per cent.
The fatal sinking of a luxury cruise ship off Italy's west coast dominated the news this weekend, with reports of at least five deaths and around 70 injuries thus far.
Parent company Carnival Corp. saw stocks fall 18 per cent on Monday, and initial estimates of the incident's cost currently sit at US$95 million.
An analyst at Morgan Stanley also slashed Carnival's estimated earnings per share by 30 per cent.
Friday's disaster already has potentially far-reaching effects on more than just Carnival. In addition to being a public relations nightmare for the company, the incident also comes at peak season for the cruise industry. Not exactly the best time to shake consumers' confidence in cruise line safety.
Consumer spending on luxury vacations was already weak this season, mostly due to a shaky global economy. And reports on the mishandling of the ship's evacuation will prompt an investigation, which could result in tighter regulations for the industry as a whole.
Sure, that's a lot of what-if scenarios. But the world's largest cruise company has a lot to lose in the wake of such a surreal disaster.
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What happened on that cruise
Submitted by Josseline on Sat, 2012-02-18 06:17.What happened on that cruise ship is horrible. I've never heard of a captain leaving his ship before the passengers. I am sorry for those who sank. That made me get car insurance ASAP, because I'm sure I won't step on a cruise ship any time sooner.