At what point should we start to worry about getting a refund?

[Mr. BoH]

Like many, we took the 125% FCC option for our cancelled cruise in 2020, which was a rather large sum. But we hoped to cruise again, and figured it was low risk because we could switch to the refund option at any time.

But does there ever come a point at which DCL is unable or unwilling to convert back to a refund? With today's announcement, DCL has now canceled ~15 months of cruises. That is a massive amount of lost revenue. I would imagine almost all cruise lines are at risk of going under at this point. If I had a credit with Carnival or Royal Caribbean I would have taken the cash long ago, but Disney's more diverse revenue base gave me comfort. I know it is unlikely that Walt Disney Company becomes insolvent, but is DCL a separate legal entity that could default and be shielded from the rest of Disney's assets? I just don't know how worried about this I should be.

We'd still like to cruise again when able and get the 125% credit, and we don't urgently need the cash right now, but I would feel like a total putz if it went up in smoke. Any others struggling with the same decision?

 

[_auroraborealis_]

DCL will be fine to provide refunds. They are not so siloed within WDC that DCL could declare bankruptcy and the debt not be held to the WDC coffers.

 

[ladyofthetramp]

Honestly- too large of a sum of money for us given all that is happening. We were most comfortable with a refund. Who knows if at some point they will only issue credits. Not worth the risk for us. I only invest in them what I am willing to lose. Right now- a deposit on a cruise out of Galveston on 12/31. Letting that one ride for a bit. But if they don't start sailing by summer, or staffing ships, I will cancel that too.

 

[brentm77]

As others have said, I wouldn't be concerned about refunds with DCL. Disney is still a profitable company as a whole, with significant revenue from other sources. It can, and will, prop up DCL as long as it takes. Not refunding money would be a black eye on its DCL brand, which it zealously protects. It has mostly done the right thing when it comes to the pandemic, and will continue to do so.

I would be much more concerned to let a large sum of money sit with another line, since they don't have alternative revenue sources and continually need to raise capital to survive.

That said, I didn't pay in full and let my cash ride on our Italy cruise, so you have to decide what is best for you. I didn't do it, mostly because it is looking more likely we will choose to do Italy by land next summer instead.

 

[Husker Mike]

The Disney brand name is more valuable than the cost of your deposits. How interested would you in buying Disney merchandise or returning to their parks after you lost thousands of dollars if DCL were to go bankrupt? At the very least, it would give you pause to vacation at their parks in the future.

DCL would be the very last cruise line I would be worried about losing your money with; I think it's as safe with Disney as with your FDIC-insured bank.

 

[cats mom]

We received a DCL cancellation e-mail this morning and we are undecided about what to do as well.
When 2020 dates were canceled we took a full refund on one cruise and rolled one cruise to 2021 with the FCC.

For us, it may come down to how far the money we have sitting with DCL goes when they release summer 2022 itineraries. I'm actually more concerned about that than about DCL being unwilling or unable to refund, at least at this point.

I can't say the same for independent vendors we booked with in Alaska. We got a full refund on an expensive helicopter excursion when 2020 cruises were canceled because we were unwilling to lose that much money. We let funds for a couple of less expensive excursions ride. While it would be nice if we were able to book with those companies in the future, we're fully prepared for that money to be gone forever.

Best of luck to all making these decisions. It's not fun.

 

[Mr. BoH]

DCL would be the very last cruise line I would be worried about losing your money with; I think it's as safe with Disney as with your FDIC-insured bank.

Totally agree with the first half of the sentence. With any other cruise company (or really any other travel company) I would have taken the cash long ago. I am banking on extra safety with WDC.

But the 2nd half is a stretch - an FDIC-insured deposit with a financially secure bank is probably the safest place you can have money. Way better than any investment in any company.

 

[Mr. BoH]

We received a DCL cancellation e-mail this morning and we are undecided about what to do as well.
When 2020 dates were canceled we took a full refund on one cruise and rolled one cruise to 2021 with the FCC.

For us, it may come down to how far the money we have sitting with DCL goes when they release summer 2022 itineraries. I'm actually more concerned about that than about DCL being unwilling or unable to refund, at least at this point.

We did the same as you - took half as a 125% credit and half in cash. Still a lot of money to tie up (it was for an 11-night European).

I am also eagerly awaiting summer 2022 itineraries, which would normally come out in Feb/March. Extending the FCC expiration date seems like a logical precursor to releasing the schedule. I think we are likely to try one more time to roll the credit over to summer 2022. But if it doesn't work by then, probably need to get the cash back. I am also worried that summer 2022 prices will be ridiculously high (well... even more ridiculous than usual). With all these enhanced credits out there, I imagine DCL will try to exercise pricing power.

 

[matt&jakesmom]

I'm booked for September for Alaska. I haven't cancelled yet. I've only paid the deposit. For those that have cancelled have you received your deposit back?

 

[brentm77]

I am also worried that summer 2022 prices will be ridiculously high (well... even more ridiculous than usual). With all these enhanced credits out there, I imagine DCL will try to exercise pricing power.

This is a concern of mine too. Is there so much credit out there, that DCL will just jack up prices 25% to make up for it? And I think there will be a lot of people looking to 2022 for significant travel plans, with the hope that things are somewhat normal by then.

 

[Cheburashka]

Like many, we took the 125% FCC option for our cancelled cruise in 2020, which was a rather large sum. But we hoped to cruise again, and figured it was low risk because we could switch to the refund option at any time.

But does there ever come a point at which DCL is unable or unwilling to convert back to a refund? With today's announcement, DCL has now canceled ~15 months of cruises. That is a massive amount of lost revenue. I would imagine almost all cruise lines are at risk of going under at this point. If I had a credit with Carnival or Royal Caribbean I would have taken the cash long ago, but Disney's more diverse revenue base gave me comfort. I know it is unlikely that Walt Disney Company becomes insolvent, but is DCL a separate legal entity that could default and be shielded from the rest of Disney's assets? I just don't know how worried about this I should be.

We'd still like to cruise again when able and get the 125% credit, and we don't urgently need the cash right now, but I would feel like a total putz if it went up in smoke. Any others struggling with the same decision?

It's unlikely that they would ever default but unlikely didn't cut it for me, after a certain point. I opted for a refund. I'll book DCL again well after cruising has resumed, when the Wish is out, and the cruise experience looks a lot like it did in 2019. No hurry as there are a lot of other vacation options. We've learned to love top notch beach vacations, something we'd never really tried before cruises were wiped off the map.

 

[Husker Mike]

Totally agree with the first half of the sentence. With any other cruise company (or really any other travel company) I would have taken the cash long ago. I am banking on extra safety with WDC.

But the 2nd half is a stretch - an FDIC-insured deposit with a financially secure bank is probably the safest place you can have money. Way better than any investment in any company.

Disney isn't going to go bankrupt; that money is safe. And no bank is going to essentially pay you 25% interest to hold your money for a couple of years.

 

[WB1971]

Disney isn't going to go bankrupt; that money is safe. And no bank is going to essentially pay you 25% interest to hold your money for a couple of years.

I agree money is safe, but would be shocked to not see significant inflation in future cruise pricing to offset everyone’s savings.

 

[Canadian Girl]

I didn’t pif so just have my 10% obb credit and a large deposit from 2 transferred cruises I moved to a single dummy cruise . If prices are in fact inflated by 25% to accommodate the credits, I will cancel and go with another cruise line. I want to do Alaska or Europe and my teens who will both be aged out of the Vibe by summer 2022, don’t want to cruise any more so would just be another adult daughter and myself. I was told to be prepared for a number of black out dates, however so the credit might not be of any advantage to me.

 

[TiggerBouncy]

Just for clarity in the structure of the Brand, Disney Cruise Lines is actually a company called "Magic Cruise Line Company, Limited" and is formed in London. It is a subsidiary of the parent company Disney Signature Experiences which is a subsidiary of The Walt Disney Company.

As such, it may be THEORETHICALLY POSSIBLE for the company (Magical Cruise Lines) to declare bankruptcy. Since it's formed in the UK, we can turn to the UK for a ruling which states "As a matter of English law, a parent entity (domestic or foreign) of a limited company cannot be held liable for the debts of that subsidiary upon its insolvency unless it has contractually agreed to accept such liability."

From a practical matter, The Walt Disney Company as others have said is FEARCELY protective of it's brand. Almost to an overboard. There is ZERO chance that Disney would take such a hit to their brand name. The cost of refunding deposits would be negligible compared to the cost to the brand name.

I would be far more concerned about Carnival, RCCL, and NCL. However each of them has enough cash to handle this pandemic (I invest in all 3 of them plus Disney, so watch their cash carefully). So at this point I would not worry about lost deposits from DCL, NCL, RCCL or Carnival. I won't speak to other smaller cruise lines.

 

[ofcabbagesandkings]

I wouldn't be worried with DCL, even so, I got a refund for my cruise last October rather than take the FCC, because I have been burned before when a resort I booked a trip with went bankrupt. I'm trying not to be nervous about my 2022 Kenya safari, even though the provider I booked with seems to be surviving, I hope they make it through. I have travel insurance on our deposit but it doesn't cover default of the provider (few do, unless you buy the insurance within 2 weeks of booking your trip).

 

[brentm77]

I wouldn't be worried with DCL, even so, I got a refund for my cruise last October rather than take the FCC, because I have been burned before when a resort I booked a trip with went bankrupt. I'm trying not to be nervous about my 2022 Kenya safari, even though the provider I booked with seems to be surviving, I hope they make it through. I have travel insurance on our deposit but it doesn't cover default of the provider (few do, unless you buy the insurance within 2 weeks of booking your trip).

While not nearly as much money, I have about $1,300 sitting with tour operators in Italy and Greece. I don't even think I will make it to Greece in the next five years unless the same cruise is offered next summer and we decide to do it instead of an Italy land trip. As for the tours booked in Rome, I hope the companies are around next summer. We had an expensive private pre-opening tour of the Vatican, tour of the Coliseum (with floor access), and a private Rome tour for a day booked. Some were paid in full, some were deposits. All were only refunded in credit only.

 

[TiggerBouncy]

While not nearly as much money, I have about $1,300 sitting with tour operators in Italy and Greece. I don't even think I will make it to Greece in the next five years unless the same cruise is offered next summer and we decide to do it instead of an Italy land trip. As for the tours booked in Rome, I hope the companies are around next summer. We had an expensive private pre-opening tour of the Vatican, tour of the Coliseum (with floor access), and a private Rome tour for a day booked. Some were paid in full, some were deposits. All were only refunded in credit only.

Sorry to hear that. There is a tour operator in the EU that is holding over 12K of my mothers money. They said they were unable to give full refunds, and are just sitting on her money right now. She is worried she may never see it again.

 

[gotomu212]

For me I‘m not worried about losing the money, it’s just not tying up thousands for several years. For a typical cruise, I PIF on the deadline each time because I don’t want DCL unnecessarily holding my money longer than needed- and that’s in normal times when there isn't uncertainty.

The 25% was nice, but between jacking up prices and my guess that cruise demand is going to be soft once they work through FCCs, I didn’t think it was a good value for holding the money.

 

[Husker Mike]

If cruise demand is going to be soft, Disney won't be able to jack up prices. Supply and demand will set the prices, not the fact that there's FCC on the books. After my second cancellation, I looked at a summer cruise and next April. The summer cruise is expensive, but I figure that's just demand. The April 2022 cruise was cheaper than the comparable 2021 cruise. So I look at the summer cruise as a "probably won't happen", but took a flyer on it. If it doesn't look for sure, I'll just cancel and rebook for next April.

Disney is going to want new money when cruises resume, because many people have taken the refunds. So I expect that while SOME cruises may be more expensive, some will not.