Memphis has bet big on Mississippi River cruises, but the industry took a hit this week when American Queen Voyages — one of three companies cruising the Mississippi — shut down.
The company said it couldn’t rebound after the COVID-19 pandemic.
“The overnight cruise industry was especially affected by changes in travel preferences and, as a result, (American Queen Voyages) has become financially unsustainable,” the company said in a statement.
Lee Hendrix is no stranger to the instability of the industry. He’s worked as a “riverlorian,” or river historian, on board the American Queen through several ownership changes and bankruptcies. His first stint on board was from the late 1990s to 2008. When the company shuttered in 2008, he left for a job with the Army Corps of Engineers as a way to stay on the river with more job security.
“It’s a tough business because you’re so dependent on the vagaries of the economy,” he said.
Hendrix returned to the American Queen a couple years ago, after retiring from the Corps. Now, he’s witnessing another bankruptcy that’s left the American Queen sitting empty at a dock.
Even as the dust settles, he’s optimistic there’s still a future for the boat he worked on, which was the company’s namesake.
“We expected that there was going to be some kind of disruption, but we somehow expected the American Queen would survive,” Hendrix said of the boat itself. “That’s sacred ground for me.”
American Queen Voyages — under various names and ownership — has a tumultuous history. There was a bankruptcy in 2001, followed by a stint of sales and closures until 2008, when the fleet went out of commission. In 2011, it returned, even headquartered in Memphis for several years, and ran continually for more than a decade until its parent company, Hornblower Group, filed for bankruptcy this week.
Kevin Kane, president and CEO of Memphis Tourism, said American Queen’s closure was an unexpected hit to local river tourism — the city is expected to lose 10,000 hotel room nights annually because of it — but he’s confident the market is still there.
Ebbs and flows
For two decades, Memphis’ investment in overnight river cruises has been up and down.
Plans to construct Beale Street Landing, the city’s biggest dock, started in the early 2000s and dragged on through three mayoral administrations. In that time, Hurricane Katrina hit, the river’s overnight cruise industry collapsed and the company that built the American Queen went bankrupt in 2001 — not for the last time.
American Queen returned, despite multiple ownership changes and business closures, but shuttered again in 2008 — as did its only competitor — leaving Memphis with a dock under construction but no cruises running on the Mississippi River.
When American Queen returned to the river, again, the company’s decision to headquarter in Memphis in 2011 was a vote of confidence for river tourism. Within the decade, however, American Queen moved its headquarters out of the city.
Then, in 2020, the COVID-19 pandemic halted all travel.
By the time cruises started up again post-pandemic, cities along the Mississippi River, including Memphis, were betting that the industry would make a comeback. Their confidence was boosted when Viking Cruises launched a Mississippi River itinerary in 2022, bringing a third company to the river.
Memphis Tourism previously estimated cruises have an annual economic impact of $100 million on Memphis and are responsible for 20,000 hotel room nights yearly in the city. American Queen alone was responsible for half of that hotel traffic.
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Overnight cruises on the Mississippi River aren’t cheap. The lowest tickets for a week-long cruise are a few thousand dollars, and Kane said cruising’s affluent customer base brings a lot of money to Memphis.
At one point, Memphis was planning a $35 million expansion of its docks — an indication of the city’s confidence that river cruises were here to stay — but the idea to build an additional dock at Greenbelt Park was scrapped late last year. All that funding will go to Beale Street Landing instead.
However, even with American Queen’s exit, Kane said the city still needs a second dock to accommodate the two remaining cruise companies: Viking and American Cruise Lines.
“We still need expanded docks,” Kane said. “River cruising is still very important to the Memphis hospitality industry.”
Sinking ship
American Queen Voyages retired the smallest of its three Mississippi River boats in late 2022. Then, last year, it scrapped its trips on the Great Lakes and sold the boats that ran those tours. At the time, the company characterized the decision as a move to refocus on its river cruises.
In late 2022, as American Queen was rolling back its services, Viking was launching its Mississippi River tours, and American Cruise Lines was adding more boats, despite the hits all three companies took when the river dropped to record lows during recent summers. Droughts forced them to change itineraries, offer refunds and, in some cases, cancel tours completely, as river conditions made it challenging — and in some cases, impossible — to travel along the river.
There were other signs of trouble in the months leading up to American Queen’s closure. The company’s president, Cindy D’Aoust, left the company last fall after about a year in the role, according to news reports. A few months later, the company canceled its season-opening tours in February, and several travel agency groups stopped booking trips on the American Queen.
Those troubles came to a boiling point in late February when its parent company, Hornblower, filed for bankruptcy and laid off 500 employees. American Queen has canceled all future cruises and is offering refunds to customers. The company is up for sale, but if there are no buyers, it’ll shut down.
“Whatever happened to them, I can’t explain it,” Kane said. “I don’t think river cruising is on the decline. I’m not the least bit concerned.”
