24 travel companies collapsed in 2011
Research by Kelkoo travel found 24 holiday companies failed in 2011, and 29 failed in 2010. Most failures occurred at peak season times. The key reasons are the recession, and more bookings direct on the internet. Thomas Cook has launched an advertising campaign with up to £400 off its holidays. 2012 will see other holiday companies go to the wall. Figures indicate that in 2006 69.4 m British citizens took trips abroad, and in 2010 it was 55.6 million.
28 December 2011
By Bev Fearis
Research commissioned by Kelkoo Travel*** has found that 24 holiday companies collapsed in the last 12 months, leading to 74,000 holidaymakers reclaiming £26 million.
The figure was a slight improvement on 2010, when 29 companies failed, impacting 189,000 travellers and resulting in £47 million worth of compensation claims.
The research, produced by the Centre for Economics and Business Research, found the average traveller waits up to four months for a refund.
Despite the significant amount of money that can be reclaimed, more than 6,000 travellers (8%) have missed out completely on compensation payments to which they are entitled.
The research highlights that the largest failures over the past 12 months have occurred in the peak season when customer bookings and deposits are at their highest.
Kelkoo Travel managing director Chris Nixon said: “Economic conditions in the holiday market have been incredibly challenging in 2011 with travel companies having to contend with factors such as rising fuel costs and the impact of air passenger duty.
“But it is reassuring that significantly less holidaymakers were affected by travel company collapses this year compared to 2010.
“Since 2007, when APD was introduced, package holiday prices have increased by 20%. [This statement is worded to make it look as if APD is responsible. APD on short haul flights is only £12 per person, on the outward leg of the trip. See below**]. On top of this, there has also been the backdrop of weak consumer spending and income growth that have dampened demand. All of these factors have had a direct negative impact on travel companies.
“Unfortunately, 2012 will see other holiday companies go to the wall, so travellers booking their summer holidays over the next few weeks should check that they book with an ATOL-protected company, so they can be sure that if their travel company does collapse, then they will be compensated.”
One comment says the most devastating factor for wholesalers is the massive increase of direct bookings to hotels. Booking directly through the internet is the key cause, along with the recession.
One of the largest collapses this year involved after the British tour operator Holidays 4 UK — which specialises in holidays to Turkey – and which also traded as Aegean Flights. Around 13,000 holidaymakers already in Turkey were sent home, while a further 50,000 people had their holidays cancelled. But many were small operations — including one of the most recent failures, The Little Black Book Limited, based in Bury St Edmunds.
** March 2011
“Thomas Cook has slapped on the surcharges for all new bookings, while Thomson and its First Choice division will apply theirs on 4 March. Both operators are charging an extra £15 a person on short-haul flights (less than three hours) to destinations such as Spain and Portugal, adding £60 to the cost for a family of four.
“Trips to the likes of Greece [below 2,000 miles, so just £12 ] and Egypt [just over 2,000 miles, so £60 APD] will attract an extra £25 a person, while long-haul vacations with flights, such as to the US and Cuba, will add £40 a person or £160 to the bill for a family of four.”
*** Figures taken from the report, ‘The impact of insolvencies on the consumer and UK travel industry’,which was commissioned by Kelkoo and conducted by the Centre for Economics and Business Research in August 2011 and updated in December 2011. The research looks into the travel providers that have become insolvent as economic conditions in the industry have deteriorated.
28 December 2011
Thomas Cook sheds more assets
Thomas Cook has agreed a deal to sell its Dutch office building for £15 million.
Under the terms agreed with FN2 B.V., part of the Fotex group, €11 million will be paid to Thomas Cook by 31 December 2011 and €4.2 million will be paid by 31 March 2012.
A further €2.8 million will be deposited into escrow – money held by a third party pending the transaction.
The sale of the building in Hoofddorp, in the Netherlands, is part of Thomas Cook’s disposal programme announced earlier this year.
See story on post-Christmas ad campaign.
By Diane Evans
28 December 2011
Thomas Cook launches vital post-Christmas advertising campaign
by Bev Fearis
Thomas Cook has launched its post-Christmas advertising campaign, offering up to £400 off summer holidays.
The operator, whose reputation and share price took a knock when it had to ask the banks for more money last month, is also promoting its Price Beat Promise.
The campaign is arguably the most important peak booking ad campaign the operator has ever launched as it looks to reassure customers that it’s business as usual.
Launching the campaign, Ian Ailles, Thomas Cook UK & Ireland’s mainstream CEO, said: “If there’s one thing as valuable as money it’s time, we’ve been saving it for customers for 170 years.
“We’ll give holidaymakers as much or as little time and advice as they need in store to make the right decision. Those looking for a great deal over the holiday weekend can call us or visit our website and take advantage of the best prices on fantastic holidays.”
The ad campaign focuses on destinations and Thomas Cook’s 170 year history.
It launched online, in stores and on TV on Boxing Day and will start in press and radio from 31 December.
Research backs up Cook’s peak push
Thomas Cook is cutting prices by up to £400 as it released research showing that a foreign holiday is the number one spending priority for Britons in 2012.
The YouGov poll of 2,066 people showed that “millions” intend to book a package holiday, according to Cook as it released details of its peak booking season campaign.
Mainland Spain tops the list of most popular destinations for those yet to book at 29%. The Balearics remains popular (24%), closely followed by France, the Canaries and Greece (all at 23%).
Egypt and Tunisia see a slight increase as destinations being considered despite the impact of the Arab spring and Italy is expected to see a rise in popularity.
The research also showed that 3% plan to stay at home because of the London 2012 Olympic Games.
Destinations are the main focus for Cook’s new advertising campaign, which sees a range of locations featured in its high street agencies, online and on TV.
The promotion, which broke on TV on Boxing Day, extends into newspapers and radio from December 31.
Cook’s UK and Ireland mainstream chief executive Ian Ailles said: “A holiday is, for many households, the biggest annual purchase.
“Every pound is precious these days and our experts in our stores, online or at the end of a phone understand the need to reassure holidaymakers that they are buying the right holiday at the best possible price.“
Unveiling a ‘best price guarantee, he added: “With an overseas holiday being Britain’s number one spending priority next year, we’re so confident that we offer British holidaymakers the widest range of holidays at the best price that we’re also launching our Price Beat Promise. We have a very clear message – we won’t be beaten on price.
“If there’s one thing as valuable as money it’s time, we’ve been saving it for customers for 170 years. We’ll give holidaymakers as much or as little time and advice as they need in store to make the right decision.”
Prices lead in at £925 per person on a Thomas Cook Holidays with Style package to Bodrum in Turkey, down from £1,125, departing Manchester on August 27 for 14 nights.
15 December 2011
Thomas Cook staff delivered ‘devastating’ news
Union chiefs representing Thomas Cook staff have described the news, less than two weeks before Christmas, that up to 661 staff could lose their jobs as part of plans to close 115 shops early next year as “devastating”.
However, officials said they were working with Thomas Cook to try to keep the level of redundancies to a minimum.
Usdaw confirmed that 60 of the shops to close are from the Thomas Cook/Going Places estate, affecting 388 jobs, 47 are from the Co-operative Group estate, affecting 223 staff, and eight are Midlands Co-op stores, hitting 50 staff.
Thomas Cook said the shops earmarked for closure had been selected on the basis of lease expiry dates, financial performance, proximity to other stores and the profile of their customer catchment area.
Usdaw national officer Sharon Ainsworth said the union was always aware the Thomas Cook/Co-op merger would lead to job losses, but it had no choice but to go along with it to secure the long-term future of the Co-op’s travel business.
She added: “Thomas Cook is fully consulting with Usdaw and our key priority will be to keep the number of compulsory redundancies to an absolute minimum. Hopefully there will be opportunities for redeployment and we’ll be trying to maximise these and do everything else we can to support and represent our members through this very difficult time.
“There is never a good time to be told your job is at risk but to hear just before Christmas is particularly devastating for everyone affected.”
The closures are subject to a statutory 90-day consultation period and no redundancies are expected before March 17 next year, said Usdaw, which represents 1,000 staff formerly employed by the Co-operative Group and Midlands Co-operative.
By Linsey McNeill
02 December 2011
Crusader Holidays ceases trading
Essex-based coach operator Crusader Holidays has ceased trading after nearly 40 years in business.
The company, which ran short break coach holidays in the UK and Europe, had been operating since 1974.
John Major, communications director for The Confederation of Passenger Transport UK, confirmed that the Clacton-on Sea firm had gone in to administration.
“Crusader Holidays are a member of the Bonded Coach Holidays Scheme (BCH) which protects customers’ money,” he said.
“Under the scheme, customers who have already paid for their package holiday (involving coach travel and at least one night’s accommodation) are protected and will get a refund in full.”
Administrators Ernst & Young are now working with BCH and will be contacting customers over the next two weeks.
“While appreciating the disappointment and upheaval these situations cause to people looking forward to their holidays, it does highlight the benefits of customers ensuring the package holiday they book is with a company that is the member of the Bonded Coach Holiday scheme,” added Major.