, Britain
In the middle of March 2020 a small cruise operator in Southampton had two ships at sea, a full summer programme on sale, and an office of people trying to work out which port would still take a passenger ship in a week's time. The answer, over about four days, turned out to be none of them.
Cruising did not decline in 2020. It stopped. Lines suspended operations worldwide within days of each other, British government travel advice turned against cruise travel in the middle of the month, and ships that had left port on a normal itinerary spent the following fortnight looking for somewhere that would let their passengers ashore.
What happened next to the companies was not really about the ships. It was about who the money in the bank belonged to.
A cruise line is funded by its customers, in advance
Take a cruise booked eleven months ahead. The customer pays a deposit at the time of booking and the balance perhaps twelve weeks before departure. That money sits with the operator until the ship sails, and every ship sailing next season has a book of it building up behind it.
This is a wonderful way to fund a business and it has one condition attached: the sailings have to happen. The cash on a cruise line's balance sheet in a normal March is not profit and mostly is not the company's money at all. It is next summer's holidays, paid for early, being used to run this summer's.
Cruising is also fixed-cost to an unusual degree. The ship exists whether or not it sails. It is financed, insured, classed, crewed, maintained and berthed somewhere. The variable costs of a voyage, food, fuel, port charges, are real but they are the smaller half of it. A line that stops sailing does not stop spending, it merely stops earning.
The refunds were due in fourteen days, in the month with no revenue
A cruise sold by a British operator is generally a package, and packages are governed by the Package Travel and Linked Travel Arrangements Regulations 2018. When the organiser cancels, the customer is entitled to a full refund of everything they have paid, and the Regulations give the organiser fourteen days to make it.
That obligation is not conditional on the organiser having the money. It fell due in the same fortnight the revenue went to zero, and it fell due on a book that had been building for a year.
A practice of offering credit notes in place of cash grew up very quickly across the travel trade that spring, and where the original booking had insolvency protection the credit note was arranged to carry it. It was still a choice being offered to a customer who had a legal right to their money. The Competition and Markets Authority took a public position on cancellation refunds that year and pursued it across the sector.
There was a further squeeze. Card acquirers, facing the prospect of a travel company failing while holding a mountain of chargeable transactions, increased the sums they held back from settlements. So a business already refunding last year's takings found that this year's arrived more slowly and less completely than before.
A ship costs money for every month it does not sail
Laying a ship up has its own cost structure and it is not free.
A ship kept in warm layup holds a reduced crew, keeps machinery turning, maintains its class and flag certification and stays insured. It can be brought back into service in a matter of weeks. A cold layup is substantially cheaper and takes far longer to reverse, because systems are shut down, tanks are emptied, the crew leave, and everything has to be surveyed and recommissioned before anybody sails on it.
Either way the ship is somewhere, and somewhere costs. Anchorages and lay-up berths are charged for. Hull and machinery cover and protection and indemnity cover continue. Classification surveys fall due on their own schedule regardless of whether the vessel has moved. Mortgage payments on the ship carry on unless the lender agrees otherwise, and in 2020 many lenders did agree, which converted an immediate problem into a larger later one.
The choice between warm and cold layup is a bet on when cruising restarts, made in a month when nobody could have known. Choose cold and save real money, then discover the market reopens and you are four months behind the operators who stayed warm.
The crew could not simply be sent home
The part of 2020 that is least remembered ashore is that the ships stayed crewed for months, because the alternative was not available.
Seafarers' employment is governed internationally by the Maritime Labour Convention, which sets limits on how long a seafarer may serve on board before repatriation and places the duty and the cost of getting them home on the shipowner. In the spring of 2020 that duty collided with closed borders, cancelled flights and countries that would not accept ships' crew at all. Crew changes that normally take an afternoon became charter flights, negotiated port calls and weeks of waiting, and many seafarers stayed aboard far beyond the end of their contracts.
For the operator this is a cost line with no revenue against it: wages, food, medical care, and eventually repatriation for hundreds of people on a ship earning nothing. It is also the reason a cold layup is not simply a cheaper button to press. Emptying a ship of its crew in 2020 meant getting them across borders that were shut.
The shore side had its own version of the problem. Support schemes covered staff employed in Britain, which covered the office and the sales team, and did far less for crew employed through the arrangements common in shipping.
Coming back was slower than stopping
Stopping took about a week. Restarting took over a year. Cruising from British ports resumed in the summer of 2021, and it resumed cautiously, with domestic sailings, reduced capacity and protocols that added cost per passenger.
Between those two dates an operator had to keep enough of a company in existence to be able to start again: the ships, the certificates, the officers, the reservations system and enough shore staff to sell a season. Every month of that was paid for out of borrowing, because the customers' money had gone back to the customers.
Where this shows up in the game
Everybody Home starts a small cruise line in Southampton in March 2020, with two ships at sea and the ports closing, and runs for eighteen months. It is marked Impossible, which is the game's warning that this one was not survivable on the merits, and you begin carrying substantial borrowing that somebody else agreed to before you arrived.
Every sailing is cancelled in month one and the whole forward book is refunded within fourteen days, exactly as the Regulations require. Crew repatriation is a one-off cost in the same month. Laying a ship up costs a monthly sum and takes two months to reverse, so the decision commits you. The support schemes of 2020 exist in the engine and arrive on their real dates, and bookings for the following season can be taken from month eight at a discount, though those bookings are refundable too. You are scored on still employing sixty people at the end of the eighteen months, so surviving with an empty payroll does not count as a result, and the page for Everybody Home sets out the starting figures.
The seed is fixed at 600019, so everybody attempting it meets the same Britain and the same eighteen months, and the scores are comparable. It runs under ironman rules: one save, and what happens happens.