Hobbit’s closing has left dozens of customers wondering if they are still booked on their trips or scrambling to get a refund.

Glen Stubbe, Star Tribune

Hobbit Travel customers left in the lurch

  • Article by: SUZANNE ZIEGLER
  • Star Tribune
  • December 23, 2009 - 11:16 PM

When they got married in 1994, Wade and Jennifer Beck couldn't afford a honeymoon so they decided to wait until their 10-year anniversary.

They had two kids and a still-tight budget, so that trip went by the wayside, too. They decided to hold out for No. 15.

But their long-awaited cruise in March and the $1,900 they scraped together for it are in limbo after Hobbit Travel closed its doors after 30-plus years, apparently a victim of the struggling economy and declining air travel.

Hobbit's closing has left dozens of customers wondering if they are still booked on their trips or scrambling to get a refund. The company is referring calls to its website, which provides customers the numbers of the airlines and cruise lines to call to sort out the mess on their own.

"My wife and I just looked at each other and our hearts sank," Wade Beck, 36, of Maple Grove, said when they got word about Hobbit on the 10 o'clock news Tuesday night.

He immediately called Norwegian Cruise Line, which had no record of his reservation or that he had paid for it. He was still trying Wednesday to get through to Sun Country Airlines to see if Hobbit paid for the flight.

About two dozen Hobbit customers contacted the Star Tribune on Wednesday with similar stories, most with cruises lined up for early 2010. Some were OK because Hobbit had paid the airline or cruise line. But many learned the money they paid was never passed along, so they have to work through their credit-card companies for a refund. The experience is made even more frustrating because no one knows when they'll get reimbursed.

At Hobbit's downtown Minneapolis office Wednesday, a lighted Christmas tree sat next to a dark and empty reception desk. Employees were packing up belongings but declined to comment. Hobbit President George Wozniak was not there and did not return phone calls seeking comment.

As of Wednesday evening, neither Hobbit nor Wozniak had filed a bankruptcy petition.

Chris Elliott, who writes a weekly column about consumers' travel woes, said he had heard anecdotally that Hobbit was cutting corners recently because it was struggling.

"This is a difficult time for the travel industry, but what's not good is that these people used a travel agent," Elliott said. "They're usually the intermediary when problems arise."

Beck said he's nervous about losing the money, but Visa told him he can dispute the charges. "I should be able to get the money back, but we're holding off until the first of the year" to decide what to do, he said, adding that some friends who are scheduled to go on the trip with them believe the situation might get cleared up as Hobbit tries to reorganize.

In a news release Tuesday night, the discount leisure travel agency said it was closing temporarily because of "financial difficulties and the present economy." It said it's looking for additional financing or a strategic partner to resume operations in the next few weeks, and has retained a turnaround advisory firm to help find financing.

Last spring, Hobbit closed two offices and laid off 55 of its 100 workers. In an interview in November, Wozniak said he expected revenue to fall to about $100 million this year compared with $135 million in 2008. But, he said, he expected the company to remain profitable.

The ripple effect is being felt by vendors and other travel companies. Sun Country said it will hold reservations for customers and will do everything possible to reconstruct trips. MLT Vacations said Wednesday it has dedicated a team of experienced reservation agents to help Hobbit customers.

'The best present ever'

Under her Christmas tree, Lora Lewis has wrapped cut-up letters that spell out the word cruise -- a surprise trip for her mom as a thank you for all she has done. Lewis paid $1,000 each for the flight and February cruise to St. Thomas and surrounding destinations in the U.S. Virgin Islands. She also wrapped up their trip itinerary and a history of each island.

"My kids have been saying, "Grandma, this is going to be the best present ever,''' she said. "Now, I don't know what I'm going to tell her."

Lewis, of Circle Pines, said Norwegian Cruise Line did not have their names listed for the cruise; Sun Country had their names for the Feb. 27 flight but had not received payment from Hobbit.

Lewis said she is still going to try to go on the trip and has contacted her credit-card company, Wells Fargo, to try to get the charges reversed so she can rebook.

Sun Country told her it would hold the seats, but she was trying to find out whether Norwegian still had room on that cruise.

A family cruise

Instead of getting Christmas presents, Cari and David Domack's three children opted to go on a weeklong cruise for spring break. Two grandparents were going to join up. Hobbit was paid about $1,000 each for all seven trips in November.

Norwegian Cruise Line had no record of their reservations but will hold their spots for a reasonable rate until they get this sorted out, Cari Domack said. Sun Country has the Domacks' names in the system but no payment, so they will have to start over there as well.

"One week for us is totally messed up, but who knows how long it will take for a travel agent to get a new job," she said.

Suzanne Ziegler • 612-673-1707

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