The financial strength of the cruise industry goes unremarked on these days, but it may be worth some reflection.
Four years ago this month the financial world was in crisis. The investment firm Bear Stearns had already failed, and Lehman Brothers was about to follow suit. The meltdown on Wall Street soon spread to Main Street, triggering a recession.
It has been a slow climb back, and not every company has survived. Consolidation and bankruptcy has been the fate of more than a few industries (autos, banks), and the travel business (airlines, car rental companies) has not been spared.
When distressed companies merge, it is worrisome for customers, disruptive for vendors and often demoralizing even for employees who keep their jobs.
Cruise lines were not immune to difficulty. Some jobs were slashed and ship orders renegotiated. But for the most part the same cruise lines that entered the recession are here today.
Lines continue to take delivery of new and bigger ships. The segment of the travel agency community devoted to cruises continues to grow.
Industry leader Carnival Corp., with 10 cruise brands, had $900 million in cash on hand as of May 31. Royal Caribbean, with five brands, has $212 million on hand as of June 30.
Financial strength translates into staying power, the ability to endure misfortunes. Like the cruise industry's heavy bet on Europe, which has floundered amid a prolonged debt crisis. Or the sinking of the Costa Concordia, with its 32 fatalities and $515 million write-off.
In the past, unexpected events have led to the demise of names like Regal, Commodore and Renaissance, which did not have the deep pockets of the families and investors that control the industry today.
But with the exception of Cruise West, the Alaska niche carrier that went defunct two years ago, the Great Recession has left the cruise industry intact.
These may not be most profitable days for cruise lines, but travel agents can at least count on them to be around to do business with in the future.
That may be unremarkable, but it is more than you can say for Lehman Brothers.