Where to buy your cruise
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(15-09-2008)

Where to buy your cruise

This summer's rapid changes in foreign exchange rates have left many consumers wondering just where they should buy their cruise. For example, the American company Vacations To Go has been selling cruises priced in dollars to customers in Europe for several years now.
Indeed, their web site welcomes them. But in the past two months the dollar has appreciated fully 13.5% against the euro, leading many to question whether this is still such a good idea.


The Advantages and Risks of Booking Your Cruise Abroad

Previous to this summer, as Europeans have watched the dollar fall, it has been not been unusual for them to reserve and pay for cruises in dollars, and indeed many US and Canadian agents are quite happy to accept their bookings. The main advantage of course has been cost, but that is not the only advantage. Possibly an even bigger one is that when cruises are bought in North America deposits are often fully refundable up until date of final payment.
This is something that is particularly important if clients are older and likely to have any health problems that might preclude them from sailing. In most of Europe if customers cancel they forfeit their deposit and have to claim back the loss from their insurers.
In North America, however, the deposit is returned with no questions asked.

There are problems of course with booking Transatlantic. For one thing, the travel agent is thousands of miles away from the client and is in is a different time zone. And if the transaction is price-related the level of service that is available will not always be anything like being able to walk into your local travel agency.

Arranging things like local airport transfers for example is more easily done by booking in one's own country.
The other thing to consider is financial security, especially as in North America this is a state or provincial responsibility and there are 60 different sets of regulations governing the security of clients' money.

But the comparison of price and service is one that at least is left to the customer, as is any risk involved in booking in a foreign currency. While traditionally, dollar fares have been lower than euro fares, since the advent of the internet, prices have stabilized and this difference has become less evident.
Indeed, there have been times in recent years when it has been cheaper for North American cruisers to buy their cruises in Europe, as long as they could accept the fact of the non-refundable deposit.


Cruise Lines' Position

Most cruise lines are more interested in filling their ships than particularly where their tickets are sold. But not all.
In a letter to the editor of "World of Cruising" magazine for example, one Swiss reader some time ago complained that when he tried to book a cruise in Florida Princess Cruises had refused to accept his booking, saying he had to book with their Swiss agent Kuoni.
As Kuoni wanted a much higher fare than the Florida agent quoted him, he booked with Celebrity instead.

Vacations To Go have a page that extends "a special warm welcome to our British and Irish visitors" and even offer an 0800 number that connects British customers to their offices in the US. Strangely though, although they show the German and Italian flags, they show pages in Spanish and Portuguese instead!

However, it seems that not all is well as further down their British and Irish welcome page we find this stipulation: "Note: Costa, Holland America, Oceania, Princess and Star Clippers now prohibit U.S. travel agencies (including Vacations To Go) from selling cruises to customers who do not have a residence in the U.S. or Canada."
All but two of these cruise companies are Carnival lines.


Restraint of Trade?

This clause reflects something that has been common practice by P&O Cruises for many years. In the past, P&O passengers have had to book in their country of residence and this has been extended to the likes of Princess Cruises, as in the example above of the Swiss customer who never became a customer.

This practice has now been extended to Cunard Line, who in the old Carnival Miami days previous to their lot being rolled in with Carnival UK, did not care where the bookings came from as long as they got them.
A problem could arise for Carnival UK at some point though as the question arises as to whether their policy is in fact a form of restraint of trade. Markets usually look after themselves and people are quite capable of taking upon themselves foreign exchange risks, especially savvy cruisers who have travelled a lot.


The iTunes Example

In April 2007, Apple faced a European Commission probe into whether the way they sold their popular iTunes in Europe constituted a violation of competition rules. Apple's European distribution system prevented users in one country from downloading music from a web site intended to serve another.
The probe was triggered by a 2004 complaint from Which magazine that pointed out that the UK version of iTunes was 10% to 20% more expensive than in other European markets. Apple could effectively have been exposed to the possibility of fines of up to 10% of the company's annual turnover.

Could Carnival UK be faced with such a situation given that it officially refuses to accept bookings in one country from another?
Rapid changes in rates of exchange prevent an easy analysis but some travel agents have recently pointed out cases where the UK fare for the same voyage in Queen Mary 2, for example, is 20% higher when booked in the UK than when booked in the US.
And might Oceania and Star Clippers be open to similar criticism?

In the end result, Apple was not fined but it was forced to drop its prices in the UK, and the announcement was made in January by no less a personage than Apple CEO Steve Jobs. But it wasn't just Apple, it was also some of their UK suppliers who had been keeping UK prices high. Could the same thing eventually happen to cruise fares?


The Big Questions

The first question is why should any cruise line be able to dictate to a potential client where they may buy their product, especially when it seems to discriminate against the less well off in favour of those that have second homes in America?

And second, and equally as important, why should American clients receive a full refund of deposit for cancellations made before final payment date while European clients of the same company face a total loss of deposit?

(Source: By Mark Tré - Cybercruises.com)


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