As of September 23rd, Thomas Cook holidays has declared bankruptcy, therefore, ending 178 years of being the nations local travel agents. It comes after the final straw in a long desired recovery package was denied by the government. This has lead to 150,000 travellers left stranded on holidays or without a holiday and 21,000 workers are at risk of losing their jobs both at home and abroad. To recover stranded workers and holidaymakers the CAA, Civil Aviation Authority, have planned out the biggest emergency repatriation in peacetime.
After Bringing in Peter Fankhauser and refinancing in 2012 the holiday agency found that their debt had built up to around £3 billion and still after paying £1.2 billion were still under the pressure to pay off the further £1.7 billion.
In the years passing between 2015- 2017 they were able to keep profitable however this wasn’t enough to be sustainable as in the following years came a British heatwave resulting in a big reduction of Brits going on holiday abroad and finally in 2019 the uncertainty of Brexit allowed the fall of the british pound making holidays abroad more expensive along with creating public uncertainty as to what would happen in the future.
The final factor that led up to the collapse of Thomas Cook is the ages that top level management were getting year on year. It was found that over the course of 4 years the companies executives had been paid around £20.5 million.
The attempts to save the company
fter their shortcomings in recent years, the company has attempted to salvage what they can in order to keep running. In doing so they had attempted to sell off Thomas Cook airlines so that they may keep their holiday agency. However, this was not the solution they had hoped for and instead decided to go for a full scale rescue deal first by asking shareholders, Fosun who had proposed to contribute £450 million to the rescue plan. A further loan from outside resources was required in order for Thomas Cook to carry on operating however after talks with the British government that loan was denied. Thus forcing Thomas Cook into liquidation and claiming bankruptcy.
What does this mean for holiday makers?
For the 150,000 people already on Thomas Cook holidays, whether just arrived or ready to leave you should be protected by ATOL and will be either put into an ATOL hotel and found a flight for your return. If you have only booked flights then you will also be covered to fly home courtesy of the government. This comes as from Monday they promise to help bring everyone affected by this collapse home. 16,500 are already due back after the collapse yesterday, the instruction given by the CAA and ATOL is only to return to the airport when notified, this is so that people return as close to their original flight plans so they can cause as little disruption as possible.
What if I was supposed to go on holiday with Thomas Cook?
If you have booked a holiday with Thomas Cook, whether that’s for in the next few days or have been prepared booking for next year sadly you will no longer be going on that holiday. You will be given a refund as promised by the CAA who have said that they aim to finalise refund arrangements by September the 30th. If you had booked a flight only holiday deal with Thomas Cook then you will have to check your insurance policy as it is uncommon for events such as this to be covered. If however, you had paid for the flights over a credit card then you will be covered by section 75 of the Consumer credit act.
If you have been affected by the collapse of Thomas Cook and would like to find out more about what steps they are taking or wish to make a complaint. Make sure to call the Thomas Cook customer services, they will be more than happy to answer any questions or queries you may have.