Why are travel businesses offering credit vouchers instead of cash refunds?

epm-84

Nebulous2 said:

epm-84 said:

Westin said:

I thought it worth posting this link to an open letter that the CEO of one travel firm has written.  Perhaps helps to explain the issues behind the scene and thinking as to just why travel credit notes are being offered.
https://www.intrepidtravel.com/adventures/james-thornton-ceo-impact-coronavirus/

It's likely travel companies including Intrepid will have to increase their trip prices for 2021 bookings but they are unlikely to increase by more than 10%, as that will put off customers.  So worth noting if you accept a £1100 travel voucher for a £1000 booking then you might find you can rebook the same holiday during 2021 without paying any extra and maybe even have part of the travel credit left over for a 2022 booking  but if you take the refund you might have to pay more to rebook next year.  Of course if you need the £1000 because you're struggling financially now then you need to push for a refund.

There certainly isn’t widespread agreement with your assumption that prices will increase. A lot of people are predicting that it will take hefty incentives to get people back. China is discounting fares. My concern is that those deals won’t be open to people with vouchers. Here’s Ryanair predicting lower prices next year. 

https://www.thesun.co.uk/travel/11404285/ryanair-cheap-flights-after-coronavirus/

Intrepid advertise land only prices so what happens to flight costs is irrelevant for their leading prices as flights are optional extras, which they quote on request.  

You might have found one quote from Ryanair but Michael O'Leary has said Ryanair's pricing model is incompatible with the idea that airlines could be forced to keep middle seats empty to maintain social distancing.  Ryanair are also axing 3,000 pilot and cabin crew roles so the number of routes they run will almost certainly reduce.  On some routes that will mean there's no longer a budget airline option and on others it may mean airlines like Easyjet and Jet2 increase prices due to reduced competition.  (Look at how much flights to Turkey have increased by since Monarch and Thomas Cook ceased trading.)

Life__Goes__On

With future flights, what happens with  "use them or lose them" rule becomes important.

bobblebob

epm-84 said:

bobblebob said:

Can you not report agents that refuse to refund in cash to ABTA (those that are members)? Even ABTA are telling members to refund in cash

ABTA have asked the government for a change in the scheme due to exceptional circumstances whereby vouchers are issued as refunds and they are given ATOL protection (so if the company goes bust the customer gets their money back) and that if the voucher is not used after a certain number of months that it can be exchanged for cash, so that companies can stay afloat in the short term.

I dont mind that solution, i think it works well for everyone. Trouble is the company im dealing with are flat our refusing cash refunds even after x amount of time. Its voucher or nothing. If you want cash, go to your insurance company. But insurance wont pay out if you have been offered a voucher. And i agree, why should they

Clarerich

Hi , new to this site but hoping for some help and info . Having trouble with holiday insurance . Our cruise was cancelled in March and I got in touch with the insurance company to ask them to transfer the policy to our new holiday in November.  They have finally got back to me and say they won't transfer but will give us a 80% refund and if we want we can take out a new policy for November with no cover for Covid . I really feel they should refund 100% why should they get 20% when none of this is our fault ! 

desklamp

Oh difficult one. Without seeing the terms and conditions of the insurance policy. I am guessing that even though it wasn’t your fault, there is probably a clause in the terms when it comes to cancellation of the insurance policy.
Personally I would check the terms of the contract for policy cancellation,  and if they are refunding you the correct amount, in your case 80% of the cost of the policy, I would probably take it, and then take my business elsewhere.
I do feel your pain when it comes to insurance companies, they make me feel very grumpy, by seemly doing very little for the money you pay them!

Life__Goes__On

"

bobblebob said:

I dont mind that solution, i think it works well for everyone. Trouble is the company im dealing with are flat our refusing cash refunds even after x amount of time. Its voucher or nothing. If you want cash, go to your insurance company. But insurance wont pay out if you have been offered a voucher. And i agree, why should they

Not everyone, there are people that have been made unemployed and need the money now or at least in the short term.
There is no solution that will please everyone.
I can understand the insurance companies,  as being asked to pay out when someone else should be paying. 

Life__Goes__On

Clarerich said:

Hi , new to this site but hoping for some help and info . Having trouble with holiday insurance . Our cruise was cancelled in March and I got in touch with the insurance company to ask them to transfer the policy to our new holiday in November.  They have finally got back to me and say they won't transfer but will give us a 80% refund and if we want we can take out a new policy for November with no cover for Covid . I really feel they should refund 100% why should they get 20% when none of this is our fault ! 

Most insurance companies are (rightly legally) not refunding payments or moving dates,
Getting 80% back is one of the best I've seen on here.
If it's fair or not, I won't comment on,  but legally they don't have to give you anything back, or move the dates.

Nebulous2

epm-84 said:

Nebulous2 said:

epm-84 said:

Westin said:

I thought it worth posting this link to an open letter that the CEO of one travel firm has written.  Perhaps helps to explain the issues behind the scene and thinking as to just why travel credit notes are being offered.
https://www.intrepidtravel.com/adventures/james-thornton-ceo-impact-coronavirus/

It's likely travel companies including Intrepid will have to increase their trip prices for 2021 bookings but they are unlikely to increase by more than 10%, as that will put off customers.  So worth noting if you accept a £1100 travel voucher for a £1000 booking then you might find you can rebook the same holiday during 2021 without paying any extra and maybe even have part of the travel credit left over for a 2022 booking  but if you take the refund you might have to pay more to rebook next year.  Of course if you need the £1000 because you're struggling financially now then you need to push for a refund.

There certainly isn’t widespread agreement with your assumption that prices will increase. A lot of people are predicting that it will take hefty incentives to get people back. China is discounting fares. My concern is that those deals won’t be open to people with vouchers. Here’s Ryanair predicting lower prices next year. 

https://www.thesun.co.uk/travel/11404285/ryanair-cheap-flights-after-coronavirus/

Intrepid advertise land only prices so what happens to flight costs is irrelevant for their leading prices as flights are optional extras, which they quote on request.  

You might have found one quote from Ryanair but Michael O'Leary has said Ryanair's pricing model is incompatible with the idea that airlines could be forced to keep middle seats empty to maintain social distancing.  Ryanair are also axing 3,000 pilot and cabin crew roles so the number of routes they run will almost certainly reduce.  On some routes that will mean there's no longer a budget airline option and on others it may mean airlines like Easyjet and Jet2 increase prices due to reduced competition.  (Look at how much flights to Turkey have increased by since Monarch and Thomas Cook ceased trading.)

You’re complaining about me giving one quote for reduced prices - however you haven’t given any for increased ones. There are many people who will be reluctant to travel and tens of millions of people whose livelihood depends on tourism. People will be incentivised to return. My concern is that people with vouchers won’t be invited to the party. It will be cash only. 

https://edition.cnn.com/travel/amp/china-aviation-industry-recovering-discounts/index.html

https://www.forbes.com/sites/ceciliarodriguez/2020/05/01/sicily-wants-to-lure-tourists-by-helping-pay-for-flights-and-hotels-post-lockdown/#4ededc2731b9

https://www.telegraph.co.uk/travel/news/coronavirus-holiday-deal-safe-bargain/

epm-84

Nebulous2 said:

epm-84 said:

Nebulous2 said:

epm-84 said:

Westin said:

I thought it worth posting this link to an open letter that the CEO of one travel firm has written.  Perhaps helps to explain the issues behind the scene and thinking as to just why travel credit notes are being offered.
https://www.intrepidtravel.com/adventures/james-thornton-ceo-impact-coronavirus/

It's likely travel companies including Intrepid will have to increase their trip prices for 2021 bookings but they are unlikely to increase by more than 10%, as that will put off customers.  So worth noting if you accept a £1100 travel voucher for a £1000 booking then you might find you can rebook the same holiday during 2021 without paying any extra and maybe even have part of the travel credit left over for a 2022 booking  but if you take the refund you might have to pay more to rebook next year.  Of course if you need the £1000 because you're struggling financially now then you need to push for a refund.

There certainly isn’t widespread agreement with your assumption that prices will increase. A lot of people are predicting that it will take hefty incentives to get people back. China is discounting fares. My concern is that those deals won’t be open to people with vouchers. Here’s Ryanair predicting lower prices next year. 

https://www.thesun.co.uk/travel/11404285/ryanair-cheap-flights-after-coronavirus/

Intrepid advertise land only prices so what happens to flight costs is irrelevant for their leading prices as flights are optional extras, which they quote on request.  

You might have found one quote from Ryanair but Michael O'Leary has said Ryanair's pricing model is incompatible with the idea that airlines could be forced to keep middle seats empty to maintain social distancing.  Ryanair are also axing 3,000 pilot and cabin crew roles so the number of routes they run will almost certainly reduce.  On some routes that will mean there's no longer a budget airline option and on others it may mean airlines like Easyjet and Jet2 increase prices due to reduced competition.  (Look at how much flights to Turkey have increased by since Monarch and Thomas Cook ceased trading.)

You’re complaining about me giving one quote for reduced prices - however you haven’t given any for increased ones. There are many people who will be reluctant to travel and tens of millions of people whose livelihood depends on tourism. People will be incentivised to return. My concern is that people with vouchers won’t be invited to the party. It will be cash only. 

https://edition.cnn.com/travel/amp/china-aviation-industry-recovering-discounts/index.html
https://www.forbes.com/sites/ceciliarodriguez/2020/05/01/sicily-wants-to-lure-tourists-by-helping-pay-for-flights-and-hotels-post-lockdown/#4ededc2731b9
https://www.telegraph.co.uk/travel/news/coronavirus-holiday-deal-safe-bargain/

Have you even read the articles you are referencing?  The one from The Sun (not renowned for high quality, well researched articles) says about lower prices on routes where there is competition and is on the basis that airlines are not forced to keep middle seats empty.  Therefore, if either our government or the EU mandate a requirement for keeping middle seats empty then what it is saying won't apply.  Also as I have already said Ryanair (and other airlines) are cutting jobs so the number of routes where competition exists will reduce and I've also highlighted what happened with Turkey flights when competition from Monarch and Thomas Cook disappeared.

You've found an article referencing a proposal for Sicily but what about holidays to the rest of Italy?

You want evidence prices are increasing next year - just look at the websites of tour companies which sell land only packages
Intrepid (the company originally being discussed) - 5th Oct 2020 - £1285 vs 4 Oct 2020 - £1330
https://www.intrepidtravel.com/uk/turkey/best-turkey-125245
Explore - 12 Sep 2020 - £780 vs 11 Sep 2021 - £815
https://www.explore.co.uk/holidays/granada-cordoba-seville#dates-and-prices
Exodus  - 23 Aug 2020 - £1199 vs 22 Aug 2021 - £1349
https://www.exodus.co.uk/croatia-holidays/culture/dubrovnik-dalmatian-coast/add?flights=excluded#dates-prices
While with Cosmos a Greece tour with a leading price of £1139 only has 2020 dates available: https://www.cosmos.co.uk/tours/the-best-of-greece/
but they have a replacement for 2021, a new tour with a leading price of £1317 (showing as a special offer as being reduced from £1519)
https://www.cosmos.co.uk/tours/classical-greece/?year=n1

Even the lowest increase is 3.5%, which is above inflation.  Other than the Cosmos 2021 price (which is still more than the 2020 price for the most equivalent tour), none of the above are showing as reduced or a special offer price.

DCFC79

Martin is covering the voucher thing on This Morning.