Boston-Based Cruise Operator Files for Bankruptcy

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The Boston-based cruise operator, Vantage Deluxe World Travel, has filed for Chapter 11 bankruptcy amid a vast amount of consumer complaints, pending refunds, and investigations by law enforcement agencies. The company had quietly laid off its workforce on June 20, 2023, followed by filing for bankruptcy nine days later.

The company’s operations will likely be sold to Singapore-based United Travel Pte. Ltd., an affiliate of Nordic Hamburg and Heritage Expeditions, subject to court approval and potential higher bids.

Vantage’s Mounting Troubles

Vantage Deluxe World Travel officially filed for bankruptcy on Thursday, June 29 at the United States Bankruptcy Court for the District of Massachusetts.  

Vantage has been under fire for some time now, facing a growing number of complaints from guests. It also attracted the attention of the Massachusetts Attorney General’s office, which received 1,120 consumer complaints since 2020. The company faced accusations of “deceptive and unfair business practices” from the Pennsylvania Attorney General’s Office.

In April, Vantage suspended all cruises through August 28 and laid off its staff on June 20. However, the company continued contacting guests regarding future travel as late as June 26.

Bankruptcy Court
Photo Credit: blurAZ / Shutterstock

Before the downfall, Vantage offered expedition cruises, river cruises, small ship ocean cruises, and land-based adventures in diverse destinations ranging from Antarctica and South Georgia to Spain and Portugal and even as far as East Africa and Chile. 

New Ownership

It looks likely that a new owner is already lined up to take ownership of the operations side of Vantage’s travel business. 

As part of the voluntary Chapter 11 bankruptcy protection filing, Vantage announced its intention to be acquired by Singapore-based tour operator United Travel Pte. Ltd. The proposed purchase agreement includes a payment of $1 million by United Travel.

United Travel, with Nordic Hamburg and New Zealand-based Heritage Expeditions, which operates the vessels Heritage Adventurer and Heritage Explorer, has committed to providing future travel opportunities for Vantage guests.

Vantage announced the deal in a statement: “Vantage Travel Services, Inc. (“Vantage”) today announced that United Travel Pte. Ltd., an affiliate of Nordic Hamburg and Heritage Expeditions, has agreed to acquire Vantage’s assets and provide customers with future opportunities for the travel experiences and the luxury service that they have come to expect.”

As part of this deal, United Travel will give a future cruise credit to customers who booked trips before May 11, 2023, which can then be used on trips with, for example, Heritage Expeditions. 

Vantage’s Financial Struggles and Future Outlook

Vantage’s financial troubles include approximately $28.1 million in unpaid bills and an estimated $80.3 million in customer claims for future trips. Among those seeking payment from Vantage are SunStone Maritime Group, Apollo River Management, Cruise Management International, Dan-Bunkering, and CMI Leisure.

Like all cruise lines, Vantage was significantly impacted by the COVID-19 pandemic, with revenues plummeting from $132 million in 2019 to just $10 million in 2020. At its peak, Vantage employed around 70 people, but as of June 20, only five remain.

Surprisingly, and despite these challenges, Vantage took delivery of two new expedition ships, Ocean Explorer and Ocean Odyssey, chartered from SunStone Maritime Group, during the pandemic. Despite the fact it had suspended operations, the company continued to take bookings for cruises and other travel options.

Also read: Genting Files for Bankruptcy, What’s Next for its Cruise Brands?

What Happens to My Money If a Cruise Line Goes Bankrupt?

Hundreds of Vantage customers have invested thousands of dollars in their future cruises, and the likelihood of getting that money back seems small. 

When a cruise line declares bankruptcy, what happens to guests’ money can vary depending on several factors. These include the specifics of the bankruptcy filing, the laws of the country where the bankruptcy is filed, and the company’s financial situation. 

In some cases, the company may be required to refund customers for trips that have not occurred. However, in most cases, customers will not receive any refund. 

Global Currencies
Photo Credit: AePatt Journey / Shutterstock

At this point, they become unsecured creditors in the bankruptcy proceedings, which means they are not first in line to receive any funds the company has left. Secured creditors, such as banks and suppliers, usually get paid first, and if there’s not enough money to pay everyone, unsecured creditors might not get anything.

In some cases, if another company buys the bankrupt company, as is happening with Vantage and United Travel, the new company might choose to honor the bookings of the bankrupt company. They might do this by providing a credit for a future trip, as United Travel does in this case. We saw the same thing when Abercrombie & Kent took over Crystal Cruises.

Customers who paid by credit card may also have protections. Some credit card companies allow customers to request a chargeback if services are not provided due to a company’s bankruptcy. It’s also worth noting that some travel insurance policies offer coverage for a travel provider’s bankruptcy or insolvency, but this depends on the specific policy.

So, while there’s a chance customers may receive a refund or be able to use their payment towards a future trip, it’s by no means guaranteed.

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