Thomas Cook Collapses

[docjames]

Isn’t the “insolvency” fund a peculiarity to the UK market, where funds are held for the event of an airline collapse to repatriate UK citizens back to the UK (not replace their whole holiday)?

I also wonder how much of this fund was consumed / expended when Monarch collapsed? That may give some indication of the costs associated this time.

 

[drron]

Can I ask why you think they should? There are plenty of comments on here decrying the fact that taxpayers money will be used to pay for repatriation... isn't it just as bad - or worse - to use (private) financial institutions funds to make people whole for something those institutions have no responsibility for?

Pointing out that if you pay by CC you have a chance of reversing the charge but a personal loan is no go.
So the richer you are the less likely to lose your money.

 

[clipped_wings]

I'm not sure advising the common person to book all travel themselves would result in greater success on average, this company did manage to survive for 178 years prior to collapse. If it was a lesson to learn, it was one that took an awfully long time to emerge.

Not advising anyone - just stating it's what I happen to do.

I don't book package holidays because I like full control - I guess this scenario just proved a sad reality and a valuable lesson in today's world.

And reiterating - it's a sad reality in today's world, not 178 years ago. Hope my post wasn't misinterpreted as anything more than observation. The situation here is way too grim to be thinking anything other than sadness.

 

[OZDUCK]

Isn’t the “insolvency” fund a peculiarity to the UK market, where funds are held for the event of an airline collapse to repatriate UK citizens back to the UK (not replace their whole holiday)?

I also wonder how much of this fund was consumed / expended when Monarch collapsed? That may give some indication of the costs associated this time.

Apparently it is an EU mandate that such schemes must exist - to quote from PPrune "EU regulations require tour operators to participate in a kind of rescue scheme that will pay for homebound flights in cases like this. Details are left to national legislation." If you are interested I have found the actual EU law - EUR-Lex - 32015L2302 - EN - EUR-Lex

 

[moa999]

Also the UK ATOL scheme only seems to protect people who book packages, not those who book individual flights and diy

 

[p--and--t]

Apparently it is an EU mandate that such schemes must exist - to quote from PPrune "EU regulations require tour operators to participate in a kind of rescue scheme that will pay for homebound flights in cases like this. Details are left to national legislation." If you are interested I have found the actual EU law - EUR-Lex - 32015L2302 - EN - EUR-Lex

Hmmm, so if there is a brexit, the victims of the next corporate crash may be left to sort their own "retrieval".

 

[travelislife]

Wow, I didn't realise they had a fleet of 105 planes, that's massive!

 

[sinophile888]

Also never book the entire package through one provider

Such excellent advice.

 

[juddles]

I really feel for the people involved in all this. It must be absolutely horrible. But it does touch a nerve of mine - that these days "everyone" seems to see the world as a huge holiday destination. It is far more complicated than that. And every so often the reality will come back to bite...

 

[Quickstatus]

Such excellent advice.

Though this is likely to have helped the demise of TC. Increasingly it is better to DIY packages. And owning an airline as a side operation?. Not such a good idea especially when your market is the budget end.

I’ve got a share in a domestic ski lodge. The board thought it might be a good idea to cater to bus groups. It was quickly shut down by the member vote as many bus groups are fixed price at the budget end.

 

[Quickstatus]

[QUOTE="VulpesVulpes, post: 2006366, member: 53721”]

Imagine having to reapply for your house mortgage every 12 months. 4 years in you change jobs only 80% of the salary but you've got a few months of payments saved up and your new lower salary still covers it. However now the bank says "no loan for you" then you're stuffed and your house is repossessed even though you could pay the mortgage.
[/QUOTE]

That’s how some of the local banks here got into hot water when they revalued properties and on the basis of a new valuation called in the loan even though there is no default.

 

[thatsthatmattressman]

Agree ..especially those that were Atol protected.

I suspect the purpose of the rescue mission is less about where the dollars and cents go and more about a responsibility that governments have to citizens in the event of certain types of global strife.

ATOL cover would be part of that responsibility: About ATOL | UK Civil Aviation Authority

 

[MEL_Traveller]

And owning an airline as a side operation?. Not such a good idea especially when your market is the budget end.

Except... you can choose your aircraft, pack in seats (9 abreast on an a330), can fly at the exact times you want (so arriving passengers take the rooms just vacated by those finishing their package), fly to the exact airports you want (close to your resorts and hotels), don’t have to fill business and first cabins, and don’t have a profit mark up.

Low cost carriers can work (JQi), owning it might make sense.

 

[moa999]

Basically, socialise the losses and privatise the profits.

Might be a small amount of socialised losses here.. but I suspect a whole heap of other businesses will suffer here

 

[cove]

Yes the creditors list will be pretty large and there will be suppliers big and small who have been caught as well as the many holiday makers. It is a nasty business and I still remember using Thomas Cook travellers cheques many years ago.

 

[Quickstatus]

9M-MNF operating 2 repat flights per day between PMI and MAN (MH A380) using a MH 84xx flight number

Owning your own airline confer dome benefits except when numbers start falling off. Then you still have to fly existing passengers but have less flexibility to open into other markets

 

[drron]

The mistake Thomas cook's directors made was not changing sufficiently in the face of the rapid changes in technology that are occurring.OTAs,AirBNB etc.With the newer generations being technology literate TC's consumer base was getting smaller every year.
So just watch places like Flight Centre as us dinosaurs die off.

 

[Quickstatus]

At least FC are not so integrated. They can buy seats from airlines rather than having to own one.

Have not used a TA for years.

 

[trooper]

Pointing out that if you pay by CC you have a chance of reversing the charge but a personal loan is no go.
So the richer you are the less likely to lose your money.

Good point!

 

[Bundy Bear]

2 years ago Monarch airlines of the UK collapsed.
ThomasCook thought they probably had some breathing space but I guess they didn't keep track of things.
You do need some smart people to keep track of an airline, resorts, and a travel business probably very complicated.
I guess end of summer is a bad time for business.