Has Viking always required full payment over a year in advance or is this a Pandemic thing?

[FolsomMike]

Just after making a down payment on a 2022 cruise, I noticed that final payment is due June of THIS year. I called Viking and a nice young man gave me a vague non answer.  My main concern is that if things took a turn for the worse and the company went bankrupt, I would probably never get my money back. Thoughts?

[OnTheJourney]

Viking has always required payment far in advance. Whether the actual payment date (relative to sail date) has been moved up even further is uncertain. You wound up speaking to one of the customer reps that basically has nothing to do with when the trip costs are due. As to the safety of your money, Viking, ever since the pandemic, has had a really good "risk free guarantee" that I believe has continued to be extended beyond what this refers to:  https://docs.vikingcruises.com/pdf/10APR-200501_RiskFreeGuarantee.pdf   Now, all of this of course pertains to cruises that they cancel. You're referring to a more serious situation in terms of bankruptcy. A quick search came up with this:  https://www.cruisecritic.com/articles.cfm?ID=5323  I don't think anyone truly knows the answers to so many questions at this point, since the industry has never been in this situation before. Guess all that really doesn't help very much. Others might hopefully chime in. 

[MikeyB]

This question was literally asked the other day!  Why don't you look back and find what your fellow cruise mates wrote.

And I'll repeat a comment I made previously.  

Do your homework, ask questions here before and not after. Go over everything with the agent before you enter into a contract.

And please don't worry about Viking going bankrupt.

[FolsomMike]

10 minutes ago, MikeyB said:

This question was literally asked the other day!  Why don't you look back and find what your fellow cruise mates wrote.

And I'll repeat a comment I made previously.  

Do your homework, ask questions here before and not after. Go over everything with the agent before you enter into a contract.

And please don't worry about Viking going bankrupt.

Well, aren’t you a bowl of sunshine. Lol. I looked back through a week of threads before posting but admittedly did not think to use the search function. I guess we can’t all be perfect. And unless you’re the CEO, you really can’t guarantee that they won’t go bankrupt. 

[Heidi13]

56 minutes ago, FolsomMike said:

Well, aren’t you a bowl of sunshine. Lol. I looked back through a week of threads before posting but admittedly did not think to use the search function. I guess we can’t all be perfect. And unless you’re the CEO, you really can’t guarantee that they won’t go bankrupt. 

 

No worries about not using the Search function, as it saved you a fair bit of frustration. It isn't the best or most effective.

 

Viking is not a member of CLIA, so does not follow the industry norms, preferring to march to their own drummer. The payment in full terms are probably one of the most contentious departures from industry norms. Peronally, I don't like paying money sooner than required, but the Viking onboard experience more than makes up for earlier payment.

 

Peregrina previously posted an excellent summary of the PIF terms over the years, which I will try to summarise from memory. Viking River, which published cruises a year in advance, required full payment at the end of the month you made the booking. I believe this standard was implemented when Viking Ocean started operations.

 

However, when we booked our first VO cruise in early 2018, it had changed to 6 months before departure. It again changed about November 2018, when full payment is required 12 months before departure, unless you have an existing booking, or are booking onboard. 

 

Voyages over 35 days, Grand Voyages and World Cruises may have different PIF terms.

[FolsomMike]

1 hour ago, Heidi13 said:

 

No worries about not using the Search function, as it saved you a fair bit of frustration. It isn't the best or most effective.

 

Viking is not a member of CLIA, so does not follow the industry norms, preferring to march to their own drummer. The payment in full terms are probably one of the most contentious departures from industry norms. Peronally, I don't like paying money sooner than required, but the Viking onboard experience more than makes up for earlier payment.

 

Peregrina previously posted an excellent summary of the PIF terms over the years, which I will try to summarise from memory. Viking River, which published cruises a year in advance, required full payment at the end of the month you made the booking. I believe this standard was implemented when Viking Ocean started operations.

 

However, when we booked our first VO cruise in early 2018, it had changed to 6 months before departure. It again changed about November 2018, when full payment is required 12 months before departure, unless you have an existing booking, or are booking onboard. 

 

Voyages over 35 days, Grand Voyages and World Cruises may have different PIF terms.

Thank for the thoughtful response...Every on line forum has its share of trolls. 😉 

[Porcupine 52]

Just a FYI..yes I have a concern about bankruptcy or a merger....

[lackcreativity]

2 minutes ago, Porcupine 52 said:

Just a FYI..yes I have a concern about bankruptcy or a merger....

I am one of Viking's biggest fans, so I have lots of emotional support invested in their survival. However, anyone who doesn't at least acknowledge the risk that a cruise line may not survive the financial stress of the shutdown is not being realistic.

I have deposits on two cruises with Viking for 2022, but have tried to avoid paying final balances by moving scheduled cruises forward. I hope to continue to do this until ships are sailing again. We are lucky that we have booked both cruises when we had one already under deposit, so we only have to make that final payment  six months before sailing. I am willing to risk deposit money on Viking's future, but would like a better picture of the future before paying a final payment. 

[The Other Tom]

4 hours ago, MikeyB said:

 

And please don't worry about Viking going bankrupt.

I read on another forum that Viking bonds are low rated. If true, that means the financial community doesn't have a lot of faith in Viking.   I haven't checked myself but I have no reason to disbelieve the rating.  Edit:  Ok, I checked.  I really don't know what to make of this, but here's some data:  https://cbonds.com/news/1327397/

Edited March 8, 2021 by The Other Tom

[FolsomMike]

8 minutes ago, The Other Tom said:

I read on another forum that Viking bonds are low rated. If true, that means the financial community doesn't have a lot of faith in Viking.   I haven't checked myself but I have no reason to disbelieve the rating.  Edit:  Ok, I checked.  I really don't know what to make of this, but here's some data:  https://cbonds.com/news/1327397/

Doesn’t look promising but I’m wondering if it’s any worse than any other cruise line.  Perhaps ironically, I’m wondering if the fact that they’re demanding full payment so far in advance will significantly help their bottom line. Getting that much cash a year before they have to actually provide a service can’t hurt. 

[OnTheJourney]

Came across this...  https://www.vikingline.com/investors/financial-reports/  

[Peregrina651]

22 minutes ago, FolsomMike said:

Just after making a down payment on a 2022 cruise, I noticed that final payment is due June of THIS year. I called Viking and a nice young man gave me a vague non answer.  My main concern is that if things took a turn for the worse and the company went bankrupt, I would probably never get my money back. Thoughts?

 

You asked for thoughts. Here is what I have. Just understand, I am not telling what you should do -- that is really none of my business. But, I do sense a bit of buyer's remorse in your questions and so hopefully what I will have to say will help you navigate through it.

 

First thought: it is not too late to change your mind and cancel.

 

Second thought: it is too late to ask Viking to change your pay in full date. Any flexibility has to be negotiated before you make your deposit; even then, the best you can hope for is 12 months before sailing.

 

Third thought: If you are concerned about a cruise line going bankrupt because you will lose your money, now might not be the time for you to book a cruise regardless of what cruise line you choose. Even the risk free guarantee that Viking is offering can not prevent bankruptcy and the loss of your money. If you are risk adverse, you may be happier keeping your cash in your pocket until things turn around after the cruise lines return to the seas on more than just a trial basis. 

 

Fourth thought: You should not feel pressured by the buzz: Viking cruises sell out, prices are going up, you won't get the cabin you want, etc. etc. These are, in my opinion, spurious arguments if your primary concern is if the company will go bankrupt before you sail.

 

Fifth thought:

4 minutes ago, FolsomMike said:

I’m wondering if the fact that they’re demanding full payment so far in advance will significantly help their bottom line.

 

Hard to tell. At lot of  today's bookings are being paid for with vouchers, so maybe not quite as much fresh cash coming in the door at this point in the game.

 

What you need to know about changing your mind:

 

If you decide that you are not ready to pay in full in June, you can still get your cash deposit back, less $100pp which I believe will be given to you as a voucher on a future cruise. If you have paid for insurance, I cannot tell you if that cost is refundable --and don't want to guess. It is a question for the insurance company (or Viking if your purchased their insurance).

 

Even after you make the final payment, you have until 121 days prior to sailing to invoke cancellation and get most of your cash back. Once you cross the 120 mark, the refund is subject to penalties as spelled out in the Viking Terms and Conditions (see link at the bottom of any page on the Viking website).  Under the penalty scheme if you cancel, what Viking would have kept as the cancellation fee is given back to you as a future cruise voucher (that is where the Viking Risk-Free Guarantee kicks in).

 

With this information, I hope I have given you some basis for making any decisions that you feel need to be made.

[OnTheJourney]

32 minutes ago, FolsomMike said:

I really don't know what to make of this, but here's some data:  https://cbonds.com/news/1327397/

Well, CCC+ is getting pretty low as far as bond ratings go when you consider that anything below BBB- is considered non-investment grade. CCC+ is 7 grades below BBB-.  C and D ratings are considered the weakest category. A Forbes report from Sept. '20 indicates that Mr. Hagen's personal wealth decreased from 6.28 billion to an estimated 2.1 in the space of a year. So Viking, like all cruise lines, has experienced a huge drop in revenue combined with a refund obligation to thousands of passengers. End result is, of course, being rather short on cash. Viking is privately held compared to probaby most other cruise lines. I'm not panicking about the cruises I already have paid for, trusting that the company will rebound.

 

Then, from what I read, you've got China Merchants Shekou and Viking having announced the formation of a joint venture to launch a line focused on mid-sized luxury products, marking China's entry into the high-end market. The Viking Sun has already been transferred into this joint venture and will have its registry transferred to China (I think this has already been done?)  I'd think a collaboration between Viking and something as huge as China Merchants Group should certainly help. 

Edited March 8, 2021 by OnTheJourney

[Heidi13]

2 hours ago, OnTheJourney said:

Came across this...  https://www.vikingline.com/investors/financial-reports/  

 

So easy to confuse companies, but this Viking Line is a ferry company based in Finland that operates Ro/Pax ferries in the Baltic.

 

Viking Cruises, as a private company, is not required to publish financial reports.

[Heidi13]

2 hours ago, OnTheJourney said:

The Viking Sun has already been transferred into this joint venture and will have its registry transferred to China (I think this has already been done?)  I'd think a collaboration between Viking and something as huge as China Merchants Group should certainly help. 

 

Viking Sun has not arrived in a shipyard, as yesterday she departed the HK outer anchorage and is currently steaming across the South China Sea. Still flying the Norwegian Flag.

 

I agree the JV with China Merchants Group should provide benefits to both companies, so the Chinese company has incentive to ensure Viking survives, to continue providing the technical support they require to get the local cruise ship operation started.

[Porcupine 52]

50 minutes ago, Heidi13 said:

 

Viking Sun has not arrived in a shipyard, as yesterday she departed the HK outer anchorage and is currently steaming across the South China Sea. Still flying the Norwegian Flag.

 

I agree the JV with China Merchants Group should provide benefits to both companies, so the Chinese company has incentive to ensure Viking survives, to continue providing the technical support they require to get the local cruise ship operation started.

Yes I think this could be a life saver for viking.  And I think Viking will do every thing they can to get back in the water again... along with all the other lines.  We have seen so many smaller companies go under this year and let's face it Viking is one of the smaller lines.  I am still holding out hope for our end of August trip.

I see Disneyland is opening up at 15% capacity and for CA residents only.... so things are headed in the right way....

[DrKoob]

When it comes to any travel provider going out of business I am kind of surprised that no one has mentioned travel insurance. First, DO NOT BUY IT FROM THE TRAVEL PROVIDER! While that might be OK at other times, if you are worried about the travel provider defaulting then don't buy their insurance as well. 

Second, find a policy that covers you if the travel provider defaults. There are many of them. Then your money is covered no matter how early or late you pay in full.

Jim

[Peregrina651]

13 hours ago, The Other Tom said:

I read on another forum that Viking bonds are low rated. If true, that means the financial community doesn't have a lot of faith in Viking.   I haven't checked myself but I have no reason to disbelieve the rating.  Edit:  Ok, I checked.  I really don't know what to make of this, but here's some data:  https://cbonds.com/news/1327397/

 

My question is: How does this compare to bonds issued by other cruise lines? Are they also seeing their ratings fall? Or is Viking an outlier?

[OnTheJourney]

9 hours ago, Porcupine 52 said:

We have seen so many smaller companies go under this year

referring to.....cruise lines?  If so, which ones?  

 

So am I correct that at this point Viking has canceled everything till end of May?  Haven't checked viking.tv for updates from Tor recently. 

[OnTheJourney]

10 hours ago, Heidi13 said:

so the Chinese company has incentive to ensure Viking survives

Andy, didn't Viking have close ties with Chinese investors even long before any of this venture idea came into being? Seem to recall either you or Jim mentioning something about that. With Viking being privately held, not sure if that is basically advantageous or not with regards to weathering financial downturns. Assumedly this is why Tor's personal wealth has taken a beating. Can't believe everything you read of course. 

Edited March 8, 2021 by OnTheJourney

[The Other Tom]

40 minutes ago, Peregrina651 said:

 

My question is: How does this compare to bonds issued by other cruise lines? Are they also seeing their ratings fall? Or is Viking an outlier?

I don't know but I would guess it's the same for other cruise lines.  I'm not worried about Viking going bankrupt but I am being cautious about booking.  If I wait too long and a cruise is sold out, or I miss a promotion, so be it.

 

[Heidi13]

15 minutes ago, OnTheJourney said:

referring to.....cruise lines?  If so, which ones?  

 

So am I correct that at this point Viking has canceled everything till end of May?  Haven't checked viking.tv for updates from Tor recently. 

 

Biggest one to go out of business so far was Cruise & Maritime Voyages (CMV), which was UK's 2nd largest cruise operator. The other cruise lines were Pullmantur (Spain) & Birka (Sweden) that I had heard of previously, however there have been a couple of others in India and other countries.

 

Crystal's parent company Genting Hong Kong stopped paying creditors back in August 2020, but are still trading, as far as I know. 

[Heidi13]

18 minutes ago, OnTheJourney said:

Andy, didn't Viking have close ties with Chinese investors even long before any of this venture idea came into being? Seem to recall either you or Jim mentioning something about that. With Viking being privately held, not sure if that is basically advantageous or not with regards to weathering financial downturns. Assumedly this is why Tor's personal wealth has taken a beating. Can't believe everything you read of course. 

 

Just prior to booking our first Viking cruise, when researching them in depth, is when they announced Chinese financing for the Sun and if memory is correct also the Orion newbuilds. I suspect the JV discussions have been ongoing since that time and the Chinese financing of 2 newbuilds was the first step in the process.

 

Haven't read anything difinitive, just an assumption, based on how things transpired.

[Jim Avery]

Andy is right of course.  (Don't tell Judi) on Viking Sun's Inaugural call to Shanghai, the naming ceremony hosted some 300+ Chinese investors onboard.  The ship's Godmother is a Chinese financier.  Speaking of cruise line bankruptcies, I anticipated Carnival or some of their brands, after running up debt.  So far only ship sales but they have been fairly aggressive dumping older tonnage.  As to Viking, I believe Tor Hagen will do the best he can for as long as possible but, if the posted drop in personal worth from 6+ billion $ to 2+ billion in a year is true, then one has to wonder.  At some point survival of self and family will top obligations to customers.  But then they have some of our $$ too.  Hoping for the best and quickly here.

[Porcupine 52]

You hit the nail on the head Jim.  I believe that if any one thinks  a bankruptcy or merger can't  happen is being very naive.  I assume that most of Hagen net worth is tied up in Viking ships. ( I don't know that but assume).  I don't know what the burn rate is for ships to kept in storage but at some point you will run out of money, unless you have a group of friendly investors or a real nice bank.

 

I almost think what is going on now is almost like a pyramid scheme. Taking on new reservations to pay off the old reservations that don't take the 25%.  Just make sure you are not on the bottom of the pyramid or have good insurance policy.  

 

This is not Viking's fault.  I have enjoyed sailing with them and hope to do so in the future.  I'm sure they will do every thing possible to get going again.