Thomas Cook collapses (Brexit was a factor)

[UNCjigga]

Surprise, Britons have been tightening their budgets and canceling vacation plans ahead of Brexit.

Tour operator Thomas Cook teetering on financial collapse

One of world's oldest travel companies could soon go bust, stranding up to 150,000 British holiday travelers abroad

www.cbsnews.com

Britain's Thomas Cook, one of the world's oldest and largest travel companies, is facing a race against time to stay afloat and ensure that around 150,000 British holidaymakers traveling abroad can get home.

The debt-laden tour operator confirmed Friday it was seeking 200 million pounds, or about $250 million, in extra funding to avoid its collapse. If Thomas Cook goes under, Britain's Civil Aviation Authority would likely be ordered to launch a major repatriation operation to fly stranded vacationer home.
...
In May, Thomas Cook reported in half-year results that it had a net debt burden of 1.25 billion pounds. It said political uncertainty related to Britain's departure from the European Union had led to softer demand for summer holidays. The company said higher fuel and hotel costs also were weighing on business.

Edit: Editing title to reflect that Thomas Cook had been in trouble since well before Brexit--Brexit may have just been the final nail in the coffin.

 

[pmv]

Not convinced that's down to Brexit, rather than just poor management and inability to ajdust to changing conditions. It's been struggling for nearly a decade.
My suspicion is that most UK companies have crap management.

 

[WelshBloke]

Not convinced that's down to Brexit, rather than just poor management and inability to ajdust to changing conditions. It's been struggling for nearly a decade.
My suspicion is that most UK companies have crap management.

Yeah. Do people use holiday booking companies now that you can book hotels direct on the internet?

 

[UNCjigga]

Yeah. Do people use holiday booking companies now that you can book hotels direct on the internet?

I’d imagine their primary clientele are pensioners 60+. Pretty sizable market.

 

[pmv]

The trouble started long before Brexit. For whatever reason, they just seem to have been useless at knowing how to deal with changing conditions (including the internet and Air B&B and outbreaks of fear over terror attacks).

Holiday nightmare: big debts and bad luck push Thomas Cook to the brink

The tour operator’s banks are demanding £200m. Otherwise it will fail – leaving jobs at risk and customers stranded

www.theguardian.com

Plus, I know it's the Mail - but, no need to read the actual article (and obviously, one never reads the reader-comments on that paper if one wants to retain any faith in humanity), the point is just the graph of the share-price at the top of the page.

Thomas Cook's share price history reveals where it's all gone wrong

Thomas Cook, the world's oldest travel company, is on the brink of collapse. Here, this is Money charts the highs and lows of the group's financial, share price and contextual history since 2007.

www.dailymail.co.uk

 

[WelshBloke]

I’d imagine their primary clientele are pensioners 60+. Pretty sizable market.

That is probably true.

 

[Greenman]

Title needs to be changed to "poorly managed, unnecessary company going broke".

 

[Bitek]

Not convinced that's down to Brexit, rather than just poor management and inability to ajdust to changing conditions. It's been struggling for nearly a decade.
My suspicion is that most UK companies have crap management.

Our company had UK based agents to facilitate export into the EU.

Due to brexit, they could not certify that they could continue to serve their role, so we dumped them for a Brussels-based company.

We are doing this with a number of raw material suppliers as well.

Our focus is on eliminating risks and concentrating on securing the larger EU market. Watching UK, but so far little certainties to be able to plan for.

It will be ugly folks.

 

[Zorba]

Yeah. Do people use holiday booking companies now that you can book hotels direct on the internet?

For some reason a lot of people still use them for cruises and Disney, which a ton of UK people come to the US for. They flew 4 flights daily into MCO from the UK as well.

 

[UNCjigga]

Aaaaand...they're done. 150,000 customers stranded around the world as Thomas Cook finally collapsed and cancelled all travel plans.

Thomas Cook travel chaos: firm's collapse leaves 150,000 stranded abroad – as it happened

A huge repatriation effort has begun after company ceases trading with immediate effect, causing flights to be cancelled

www.theguardian.com

 

[MomentsofSanity]

Aaaaand...they're done. 150,000 customers stranded around the world as Thomas Cook finally collapsed and cancelled all travel plans.

Thomas Cook travel chaos: firm's collapse leaves 150,000 stranded abroad – as it happened

A huge repatriation effort has begun after company ceases trading with immediate effect, causing flights to be cancelled

www.theguardian.com

I have heard that the estimated cost to the UK to repatriate will be approx $750M. It's the largest non-wartime repatriation effort they've had to undertake.

 

[WelshBloke]

I have heard that the estimated cost to the UK to repatriate will be approx $750M. It's the largest non-wartime repatriation effort they've had to undertake.

I'm actually surprised that the government is involved in the cost of this. I'd have thought that the majority of the cost would be covered by travel insurance and the remainder up to the individual. I've certainly never thought about phoning up the British council when I've stranded myself places!

 

[pcgeek11]

I'm actually surprised that the government is involved in the cost of this. I'd have thought that the majority of the cost would be covered by travel insurance and the remainder up to the individual. I've certainly never thought about phoning up the British council when I've stranded myself places!

I also don't see where the government should be involved.

 

[WelshBloke]

I also don't see where the government should be involved.

I mean I can understand it if a revolution breaks out in a country and peoples lives are at threat but being stranded on a holiday to Disney world doesn't seem like a nation emergency to me.

 

[pcgeek11]

How do the taxpayers feel about this 750 Million expense?

 

[pmv]

[virtue signalling mode] Why can't they just cycle home? That's what I do when the train is cancelled[/virtue signalling mode]

Is there maybe some existing government guarantee scheme under which this rescue is happening? Being stranded when you've already paid your way, because someone else won't pay their bills, isn't quite the same as stranding yourself., I suppose.

This seems to be beginning to look like yet another case of crappy/greedy/self-serving corporate management. Looks like another case of a lot of people walking away with wheelbarrows full of cash, while the taxpayer picks up the tab.

Thomas Cook fatcats face calls to hand back £50m in pay over the past 10 years

The travel operator went bust today leaving 150,000 holidaymakers stranded and putting over 20,000 people out of work

www.mirror.co.uk

 

[Greenman]

$5000 a head to get those folks home seems a little steep. There isn't an EU version of Southwest airlines?

 

[UNCjigga]

$5000 a head to get those folks home seems a little steep. There isn't an EU version of Southwest airlines?

There are plenty...Easyjet, Ryannair, though Norwegian has better service like SW. But booking 24 hours before your flight doesn’t get you the best fares.

 

[robphelan]

I also don't see where the government should be involved.

because countries always have certain responsibilities to their citizens.

similarly, when a US citizen is charged for a crime.. a journalist is being imprisoned... etc... the home country has a duty to their citizens.

 

[zinfamous]

Hasn't that entire industry been hemorrhaging for decades? Kinda shocked that such a major one still exists anywhere, as pretty much any person now has individual access to all of the best pricing.

Is this some niche luxury brand or something?

 

[WelshBloke]

because countries always have certain responsibilities to their citizens.

similarly, when a US citizen is charged for a crime.. a journalist is being imprisoned... etc... the home country has a duty to their citizens.

They do, and I'd expect them to act if a war broke out or a natural disaster and all flights were grounded but I wouldn't expect them to act over something that travel insurance should cover.

 

[UNCjigga]

Hasn't that entire industry been hemorrhaging for decades? Kinda shocked that such a major one still exists anywhere, as pretty much any person now has individual access to all of the best pricing.

Is this some niche luxury brand or something?

They were one of the last fully integrated travel agencies/tour operators. One stop shop. You book through them and you stay in their affiliate m hotels, travel via their airline, travel via their cruises/tour buses etc etc. Complete itineraries with zero effort on behalf of the traveler. I’m sure that every country has a sizable population of people with no experience when it comes to international travel and a desire to purchase via a local agent vs. the Internet.

Seems that beyond the pensioner crowd, they were also popular for booking destination weddings for a large number of guests.

 

[Fern]

Having lived in London, and in other parts of Europe, I find it hard to believe that many in the UK had never traveled internationally. I saw tons of them whenever I traveled.

I guess Thomas Cook had some 'value' but I don't know what it was. My only guess is that purchasing a travel 'bundle' from them ended up being cheaper than piecing everything together yourself.

Fern

 

[ElFenix]

They had their own branded airline. Used to spot their A330s on the Puerta Vallarta - Manchester run.

 

[s0me0nesmind1]

Not convinced that's down to Brexit, rather than just poor management and inability to ajdust to changing conditions. It's been struggling for nearly a decade.
My suspicion is that most UK companies have crap management.

Yup. Seeing how many people were stuck tells me they had plenty.

There is now scrutiny for big wigs taking fat bonuses while the company continued to perform poorly.