Updated 14 October 2019 at 21:45 IST
EU OKs $419M German loan for Thomas Cook airline Condor
The German government says the European Union has approved its decision to grant airline Condor, a subsidiary of collapsed tour operator Thomas Cook of $419M.
The German government says the European Union has approved its decision to grant airline Condor, a subsidiary of collapsed tour operator Thomas Cook, a 380 million-euro ($419 million) bridging loan to keep it in the air. The Economy Ministry said the EU’s executive Commission gave its blessing on Monday. Condor applied for the loan last month to tide it through the winter after British-based Thomas Cook ceased operations. The airline, which has been profitable, has nearly 60 planes and 4,900 employees. Condor’s management is looking for new investors.
UK travel firm Hays to buy stores from defunct Thomas Cook
British firm Hays Travel says it will buy all 555 U.K. stores operated by defunct tour company Thomas Cook, which collapsed last month. Hays says it will offer jobs to hundreds of Thomas Cook employees. David Chapman, the official receiver handling the winding up of Thomas Cook, said Wednesday that the deal “represents an important step in the liquidation process, as we seek to realize the company’s assets.” The debt-laden, 178-year-old company collapsed last month, leaving hundreds of thousands of travelers stranded around the world and 21,000 employees, including 9,000 in the U.K., facing unemployment. Some 150,000 British travelers were flown home at government expense in the biggest repatriation effort since World War II.
A perfect storm of change, debt and Brexit sank Thomas Cook
British tour operator Thomas Cook fell victim to multiple setbacks including shifting travel habits, the rise of online booking sites, the sinking pound and even unusually hot summer weather at home that discouraged Northern Europeans from travelling. Specific problems of its own, like a 1.6 billion-pound ($2 billion) debt pile, made it less able to react to change. It all added up to a perfect storm that led the 178-year-old company to cease operations early Monday, stranding hundreds of thousands of travelers. Analysts said Thomas Cook, which rode a package holiday boom that started in the mid-1980s, was too slow to react as consumers moved away from buying trips at bricks-and-mortar stores.
READ: Thomas Cook Auditors Investigated By UK Accounting Watchdog FRC
It has been overtaken by online services like Airbnb and internet travel companies who may separate or combine hotel, rental car and flight offerings, which puts pressure on prices through comparison shopping. Company officials have cited uncertainty over Brexit, both from consumers worried about its impact on their finances and from the timing, given that one unfulfilled deadline for Britain to leave the EU fell on March 31, just days before the heavy European Easter holiday travel season this year. Travel agents had to issue guidance on what would happen in case of a no-deal Brexit. Brexit has meanwhile sent the pound lower, given British travellers less purchasing power. After 2010, the Arab Spring revolts discouraged travel to previous U.K. favourites such as Egypt and Tunisia. Travel companies shifted their focus to the Western Mediterranean, such as Spain’s Canary Islands, only to see demand for some of those locations then dwindle.
Published By : Associated Press Television News
Published On: 14 October 2019 at 21:36 IST