The world’s oldest Travel agency, Thomas Cook is on the verge of collapse and could potentially strand 600,000 holidaymakers worldwide.
The collapse could happen TODAY and would strand 600,000 travellers including 160,000 Brits, triggering Britain’s biggest peacetime repatriation to get them home.
Thomas Cook, which at 178 years old makes it the world’s oldest travel provider, serves around 19 million customers a year in 16 countries with 566 stores.
The AU$2 billion debt-ridden company employing 22,000 staff worldwide is currently holding desperate last-minute talks to fight off bankruptcy unless it can secure an extra AU$370m in funding.
Thomas Cook shares have plunged 96% since May 2018 and dropped a further 23% to AU$6.36 on Friday after they announced that they had only 48 hours to stop the company from going bust.
According to The Guardian UK, the government and aviation watchdog, the Civil Aviation Authority (CAA) is now drawing up plans for the biggest ever UK peacetime repatriation to be known as Operation Matterhorn if Thomas Cook does collapse.
The sad news follows the closure of Tempo Holidays and Bentours AUS/NZ on Thursday, which saw the loss of 90 jobs and agents and customers left in the dark as to the status of their bookings.
How has this happened?
Thomas Cook says its recent financial struggles have been attributed to competitive online operators, the increased prices of jet fuel and hotels, concerns over Brexit, political turmoil in destinations such as Turkey, and summer heatwaves that discouraged customers from travelling outside of the UK.
What will happen to customers who’ve booked?
The good news for British Thomas Cook customers is that they are protected by the British ATOL (Air Travel Organiser’s Licence) scheme, meaning their holiday accommodation, as well as return flights, are guaranteed if they are abroad at the time of collapse.
The British ATOL scheme ensures that while holidaymakers may end up enduring stressful changes of plans and potential delays in getting home, their holidays will be covered financially.
The CAA states on its website: “If you are on holiday when the ATOL holder fails, we will try to ensure you can finish your trip and return.” It advises people to keep checking its website and social media pages for the latest information.
It’s estimated that the total cost of British holidaymakers guarantees to be paid by the ATOL scheme underwritten by the CAA will be around AU$1.1 billion.
What about customers who haven’t travelled yet?
Thomas Cook statue in Leicester, England
Future bookings are also protected, with the CAA advising that if an ATOL protected firm collapses, and a British customer has not yet begun their trip, it would advise them on how to make a claim for a refund. Or, in some cases, the CAA “will appoint a fulfilment partner to provide the holiday”.
Around 50% of Thomas Cook customers have booked flights only and may not come under ATOL protection, but the 2017 Monarch Airlines collapse (The Uk’s previously biggest repatriation of 110,000 passengers) precedent suggests the government would assume responsibility for bringing them home.
If Thomas Cook does manage to find the funds to avoid going bust before this evening Australian time, it must then seek approval for a financial restructuring at a court hearing on Friday 27 September.
The hope is that the government will come to the company’s rescue and help save the 22,000 jobs at risk.
For more information, visit: www.thomascook.co.uk