Thomas Cook collapses, 150,000 people stranded
In this file photo taken October 11, 2014, an A320 airport bus departs from the Thomas Cook Company at Lille-Lesquin Airport, Northern France. British travel group Thomas Cook declared bankruptcy on September 23, 2019 after failing to reach a last ditch rescue deal, triggering Britain's largest homecoming since World War II to bring stranded passengers back. (Photo: PHILIPPE HUGUEN, AFP / Getty Images)
LONDON – British tour operator Thomas Cook collapsed early Monday after failing to secure emergency funding, leaving tens of thousands of vacationers stranded abroad.
The British government said the return of the 178-year-old firm's 150,000 UK customers who are now vacationing across the globe would be the largest return in peacetime history. The process began on Monday and officials warned that delays are inevitable.
The Civil Aviation Authority said Thomas Cook has ceased trading, the four airlines will be grounded and the 21,000 employees in 16 countries, including 9,000 in the UK, will lose their jobs. The company had blamed several months ago for a slowdown in bookings due to uncertainty in Brexit for contributing to the crushing debt load.
The company had said it wanted £ 200 million (£ 250 million) to avoid going bust and was in weekend talks with shareholders and creditors to avert failure. The company, whose airlines were a well-known sight in many parts of the world, also operated around 600 UK travel stores.
The company's CEO, Peter Fankhauser, said in a statement read outside the company's offices Monday morning that he deeply regrets the closure.
"Despite tremendous efforts over several months and further intense negotiations in recent days, we have not been able to come to an agreement to save our business," he said. "I know this outcome will be devastating for many people and will cause a lot of anxiety, stress and disruption."
The United Kingdom's CAA said it had arranged a fleet for the complex UK repatriation effort, which is expected to last two weeks.
"Due to the significant extent of the situation, some disruption is inevitable, but the CAA will attempt to get people home as close as possible to the scheduled dates, "the aviation authority said in a statement.
Descriptive Return Plan, British Transport Secretary Grant Shapps dozens of charter aircraft, from as far away as Malaysia, were hired to fly customers home free of charge. He said hundreds of people had staffing centers and airport operating centers.
“The task is enormous, the greatest return of peacetime in the United Kingdom. So there will surely be problems and delays, "he said.
British travel expert Simon Calder told Sky News that Thomas Cook's problems began in 1994 when the" open skies "agreement allowed upstarts easyJet and Ryanair to flourish. he, the internet was widely used for travel bookings, which reduced the demand for Thomas Cook's travel agencies.
"It is still, of course, a place for travel professionals, it is already a place for the package, as companies such as Jet2 and TUI demonstrate, but Thomas Cook was behind the curve, and I'm afraid of high costs that the expensive street areas they simply couldn't handle, he says.
Traveler Lucy Jessop from the eastern city of Hull said she had planned to return from Mexico to Manchester with Thomas Cook on Tuesday, and that the government had organized an alternative flight back to England.
She said she was worried first about the collapse and praised the government's swift action.
"It is Thomas Cook's staff and all those who are going on vacation I feel," she said. "We were the lucky ones, I guess."
Unions representing the Thomas Cook staff had urged the British Government to intervene to propose Thomas Cook to protect jobs and the traveling public.
British Prime Minister Boris Johnson said the government had the right not to bail the company, arguing that travel companies should do more to ensure that they did not collapse.
Johnson said the government would help bring home the stranded British travelers. But he said rescuing the company would have established "a moral hazard" because other companies may later expect the same treatment.
"We must look at ways that tour operators can somehow protect themselves from such bankruptcies in the future," Johnson said. "They are driven to reflect on whether the directors of these companies are properly incentivized to settle in such cases. "
Most of Thomas Cook's UK customers are protected by the state-controlled travel insurance program, which allows vacationers to return home if a UK-based tour operator fails while abroad.
A former repatriation exercise after the collapse of Monarch Airlines in 2017, the government cost around £ 60 million. The Thomas Cook effort is much greater and is likely to be much more costly.
Travelers who have reservations with Thomas Cook were told not to go to the airport because all flights was canceled.
Thomas Cook, who began in 1841 with a one-day train journey in England and now operates in 16 countries, has struggled in recent years. raised £ 900 million ($ 1.12 billion), including receipt of money from leading Chinese shareholder Fosun.
An estimated 1 million future travelers will find bookings for upcoming holidays canceled. They are likely to receive reimbursement in accordance with the government's travel insurance plan.
In May, the company reported a debt burden of £ 1.25 billion and warned that political uncertainty related to Britain's planned departure from the EU at the end of October had harmed the demand for summer holidays. Over the past few summers in Europe, heat waves have also caused many people to stay home, while higher fuel and hotel costs have burdened travel business.
The company's problems were already affecting those traveling under the Thomas Cook banner.
A British holiday told BBC radio on Sunday that Les Oranger's seaside resort in the Tunisian town of Hammamet, near Tunis, demanded that guests who were about to pay extra money for fear that it would not be paid what it is is due to Thomas Cook.
Ryan Farmer said many tourists denied the claim, since they had already paid Thomas Cook, so security guards closed the hotel's gates and "did not let anyone leave."
It was like "being held hostage," Farmer said, which will leave on Tuesday. He said he would also refuse to pay if the hotel asked him.
The Associated Press called the hotel as well as the British Embassy in Tunis, but no officials or managers were available for comment.
––– [19659037] Associated Press author Jill Lawless of New York contributed to this report.
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