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-   -   Thomas Cook Enters Compulsory Liquidation (https://www.flyertalk.com/forum/other-european-airlines/1988392-thomas-cook-enters-compulsory-liquidation.html)

milepig Sep 23, 19 9:30 pm

I was struck by the pics of long lines of people in airports queued up in front of empty desks. What do they think is going to happen, smiling staff will suddenly appear and take care of them?

oliver2002 Sep 23, 19 11:30 pm

Some are missing the point here: TC was primarily a tour operator on a grand scale who also had an airline. The tour op business went bust, and (for now) pulled the UK airline with it. Tour op packages are not airline tickets, they are protected in Europe. In the UK the ATOL kicks in, in Germany the compulsory insurance ensures that you are bought home and the hotel etc is paid for during the trip and if the trip has not started you get your money back.

irishguy28 Sep 23, 19 11:49 pm


Originally Posted by OhDoctor (Post 31556142)
How could they continue to fly people out on departures with the risk of imminent bankruptcy looming?

Let's think that through.

You turn up at the airport to check in for your 2-week package holiday. "I'm very sorry, Doctor, but we are refusing to fly you out on holiday. We may collapse into bankruptcy while you're away, you see".

How would you react then? I don't imagine you would be quite as euphoric as the original post suggest; afterall, you are being turned away on the basis of something that hasn't happened (and may not happen).

And what do you think would happen when it became public knowledge that a travel company was refusing to abide by its contracts in this manner? Do you think it would be good for business, right at the moment when they are struggling to stay afloat and the last thing they need is to disrupt their cashflow?

Thomas Cook quietly stopped selling tickets online only at 10pm on Sunday night, once it became clear that there would be no rescue. To have ceased some operations - such as selling certain tickets, or turning customers away at the airport - prior to this while a rescue was still being worked on, would have immediately brought about the end of the business.

NWIFlyer Sep 24, 19 12:04 am


Originally Posted by iflyjetz (Post 31555851)
No one in the US has been covering TC. I'll freely admit I missed it. If I had heard of the problems, I would have looked at their financial filings. Of course it looks like every European airline is having financial difficulties (which I blame on EU261 and overcapacity) so in the future I will not be surprised if every single European airline goes under.

Thomas Cook wasn’t just an airline operation, it was a Travel Agent and tour operator. The tour operator side of its business was a much larger part of the business, and quite probably the airline side itself (it did carry passengers outside its package holidays) was still profitable. Maintaining a suite of High Street stores, running into hundreds, is a very expensive operation in the UK, and it’s far more likely that the growth of OTAs was the dominant cause of failure. TC just never really adapted to changing market conditions.

If you want to measure the effect of EC261 on European Community carriers (and of course US ones are affected by it as well some of the time), Ryanair certainly used to separate a levy out - it was something like 2% of the fare for them. It’s not something that’s ever going to make or break an airline. It’s not what did for TC.

There isn’t going to be a rash of airlines going bust - I would hate for anyone to base a decision on the premise that TC is somehow typical of European aviation.

irishguy28 Sep 24, 19 12:12 am

2 Attachment(s)

Originally Posted by milepig (Post 31556505)
I was struck by the pics of long lines of people in airports queued up in front of empty desks. What do they think is going to happen, smiling staff will suddenly appear and take care of them?

That's precisely what is happening. The CAA has leased upwards of 40 aircraft and is returning all passengers on replacement flights that scheduled as close to the cancelled flights as they can manage.

nk15 Sep 24, 19 12:20 am

It’s a very delicate and surreal operation, one moment they sell you tickets and it’s all fine and dandy, and the next moment all 22,000 employees have disappeared and they don’t know what are you taking about....

Hezu Sep 24, 19 1:13 am

Some positive news (at least to the customers) for change, according to the latest news the Nordic subsidiaries of Thomas Cook (Tjäreborg, Ving, Spies, Globetrotter + Thomas Cook Airlines Scandinavia) have managed to secure some extra funding to continue operations. Yesterday's flights were cancelled though so there is some unhappy people that have missed their trips abroad and more importantly some that must be repatriated from their holiday destinations.
And of course, there is the question if this new funding really helps to keep the business profitable in the long term...

Internaut Sep 24, 19 1:29 am

In other news, Jet2, Tui and Virgin Holidays have all said they're having a bit of a recruitment drive. Which basically means their HR sharks are talking to Thomas Cook's HR sharks (who presumably haven't yet switched the lights off) about mining for the best performing staff. If you're a now ex TC employee who got a good score in your last appraisal, you've got (possibly slim) opportunities. Lots of news also about banks voluntarily allowing charge back on a lot of Debit Card purchases - no one wants to be in the news for the wrong reason. And the repatriation is going like something that looks like something that has been planned for a long time....

My fellow Brits might want to reflect on the levels of consumer protection we have here. I'm not sure losing any of that would a good idea.

irishguy28 Sep 24, 19 2:23 am


Originally Posted by Hezu (Post 31556886)
Some positive news (at least to the customers) for change, according to the latest news the Nordic subsidiaries of Thomas Cook (Tjäreborg, Ving, Spies, Globetrotter + Thomas Cook Airlines Scandinavia) have managed to secure some extra funding to continue operations. Yesterday's flights were cancelled though so there is some unhappy people that have missed their trips abroad and more importantly some that must be repatriated from their holiday destinations.
And of course, there is the question if this new funding really helps to keep the business profitable in the long term...

Meanwwhile, the Dutch branches of Thomas Cook and Neckermann cancelled all of today's flight departures, with uncertainty about flights due to depart Wednesday and later.

flatlander Sep 24, 19 2:33 am


Originally Posted by MSPeconomist (Post 31554234)
Who is Frances Coppola and why should we believe her opinion?

By the power of Google:FORBES - Frances Coppola


I used to work for banks. Now I write about them, and about finance and economics generally. Although I originally trained as a musician and singer, I worked in banking for 17 years and did an MBA at Cass Business School in London, where I specialized in financial risk management. I’m the author of the Coppola Comment finance & economics blog, which is a regular feature on the Financial Times's Alphaville blog and has been quoted in The Economist, the Wall Street Journal, The New York Times and The Guardian. I am also a frequent commentator on financial matters for the BBC.
Frankly I've had a look at Thomas Cook's finances and even though I am not in possession of an advanced degree in financial matters I can also tell they were under severe financial strain and not in a stable financial condition.

flatlander Sep 24, 19 3:15 am


Originally Posted by OhDoctor (Post 31556142)
And now UK taxpayers are holding the (very large) bill, with Brexit looming as well? This seems reckless at best on the part of management, and criminally negligent at worst. Why haven't I heard more from the torch-and-pitchfork crowd looking to see heads roll? I would be incensed.

UK taxpayers are not holding the large bill for all the package tour costs. The ATOL protection scheme which is funded by tour operators, and an insurance policy against large claims on this fund, will hold the bill. It is operated by the UK CAA. Total funds available are reported at £520M which compares with estimated costs of £500M-600M.

The CAA decided that ATOL would continue cover TC over the past year. It is renewed annually and it is widely reported that the next review would have seen ATOL cover withdrawn due to TC's financial instability. TC was not nearly so unstable last year when the year-long cover was granted. So the CAA has acted reasonably prudently and there is an industry fund to cover failures like this.

The CAA, and therefore either the rest of the ATOL fund or general government funds, are also bringing home people who bought only a flight from TCX. That's their choice, and they didn't do this for many other airline failures in the past few years, so that's the UK government's agency choosing to fund this.

There's a question of using ATOL funds to repatriate non-package customers. Package operators might be unhappy about that, but the CAA might tell them to be quiet for the good of the image of their industry. The CAA is also running aircraft at close to the original TCX schedule times, and they would simply travel partially empty if they left the air-only customers behind. That would be neither humane, nor a good public image, nor save a lot of money. So, in the end the CAA's action seems reasonable there too.

lloydah Sep 24, 19 3:34 am

Does anyone have an opinion here - a good friend on a ticket only TC flight back from Skiathos last Saturday afternoon found that, when they landed at STN the luggage had been left behind because "the extra weight would have prevented take off." Now World Tracer just says refer to the airline which doesn't exist anymore. Is it now a case of personal insurance or will the luggage once more appear off one of the repatriation flights?

irishguy28 Sep 24, 19 4:17 am


Originally Posted by lloydah (Post 31557124)
Does anyone have an opinion here - a good friend on a ticket only TC flight back from Skiathos last Saturday afternoon found that, when they landed at STN the luggage had been left behind because "the extra weight would have prevented take off." Now World Tracer just says refer to the airline which doesn't exist anymore. Is it now a case of personal insurance or will the luggage once more appear off one of the repatriation flights?

It's still far too early for any insurer to declare the luggage lost.

There is still, I guess, some chance that the luggage will show up, but I would get acquainted with the terms of your friend's travel insurance and be ready to act as soon as the insurance allows a claim.

lloydah Sep 24, 19 4:28 am


Originally Posted by irishguy28 (Post 31557192)
It's still far too early for any insurer to declare the luggage lost.

There is still, I guess, some chance that the luggage will show up, but I would get acquainted with the terms of your friend's travel insurance and be ready to act as soon as the insurance allows a claim.

Thanks for the respense. That's more or less what I thought. Seemed a bit of a lame reason that they gave him but I'm not an expert. Told him to keep the tag anyway just in case.

irishguy28 Sep 24, 19 4:48 am


Originally Posted by lloydah (Post 31557208)
Seemed a bit of a lame reason that they gave him but I'm not an expert.

I think it's actually probably the truth, rather than an excuse.

The operation is quite stretched at the moment, with the need to get as many people home as quickly as possible. It's not surprising to read that, in some cases, baggage handling has not proven up to the task.

It's certainly not unusual even for mainline scheduled carriers to sometimes depart without all luggage. Keeping the plane on schedule is sometimes the lesser of the evils of waiting to get everyone's luggage on board; delays have knock-on effects. On my last KLM flight to Berlin, they announced that most luggage had been left behind and would be delivered separately from later flights.


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