Thomas Cook In Financial Trouble

[Chez2 10]

It sounds like these people want the moon on  a stick. Once holiday companies have your money they can do pretty much what they want re changing airports etc, been there, done that. If the company is solvent you can do more but its still very limited. I've had a good rant about it and had to fight tooth and nail for stuff. Doesn't mean it will happen, even when correctly insured. I recently looked at moving away from my umbrella policy to better cover for lost luggage, delays etc but the insurance was so expensive it wasn't worth it. Its about making an informed decision and weighing cost and risk. Sadly many don't take the time to research this. 

 

I've heard some bad things about insurance. I know a lady that was taken seriously ill on holiday, luckily she was insured. Spent most of it in hospital, had to stay extra until she was well enough to fly. Had to have medical escort back home but then dumped her in the nearest hospital in the UK. She was checked and discharged. The couple are in their seventies and they insurance company said they were repatriated and washed their hands of them. They were over 150 miles from their home. Luckily some friends or family took time off to fetch them home. I have no idea how they got away with dumping someone so far away from home, someone who was bad enough to need qualified medical staff to be with them on the journey home. 

[melthebell 862]

Interesting read on how and why they failed

 

Thomas Cook's problem? Debt

Simon Jack

BBC Business Editor

In the end Thomas Cook was a victim of that serial company killer – debt. When you owe £1.7bn, not much needs to go wrong to tip you over the edge – and with Thomas Cook a lot had been going wrong.

In fact, Thomas Cook has been struggling for a decade. Mergers with MyTravel and Co-Op had left it with 1,200 high street stores JUST as consumers were moving online.

It had a near death experience in 2011 but was saved when its lenders agreed to support it during a restructuring that saw it close over 600 bricks and mortar outlets.

Thomas Cook’s basic business model is to buy up package holidays in bulk months in advance and then sell them on. It's inherently risky as terror attacks, currency moves, unexpected heatwaves in the UK and uncertainty about ease of travel and insurance arrangements after Brexit could and did hit demand leaving the company exposed.

In May it announced a loss of £1.5bn, pushing it further into debt. Its largest shareholder, the Chinese company Fosun - which also owns another holiday company, Club Med – offered to plough in £450m but the company’s lenders didn’t think there was enough cash to see it through the lean winter months.

It required another £200m and when that couldn’t be raised privately, it turned to the government, which refused, just as it had with contractor Carillion to prop up a private company with taxpayers' money.

Thomas Cook’s chief executive took home £8m in pay and bonuses in the last four years and there will be an investigation into the conduct of directors. That will be little comfort to 21,000 Thomas Cook workers who are facing unemployment rather than a bit of holiday disruption.

apparently a heartfelt thankyou letter was stuck to the window of the Fargate shop

[Chez2 10]

There should be an investigation if he took that much over a four year period. He may, or may not have made progress in starting to  turn things around but to take that much out a company in  so much debt! Really?  Why oh why do companies get themselves in so much debt? 

[melthebell 862]

What to do if youre booked to fly with them

 

[melthebell 862]

Flight crew found out it had collapsed while in the air mid flight, passengers then had a whip round for them.

https://www.breakingnews.ie/business/thomas-cook-passengers-give-staff-carrier-bags-of-cash-after-flight-home-952602.html

[nightrider 13]

Interesting twist in the tale:

 

https://www.theguardian.com/business/2019/sep/23/squadrons-start-flying-150000-thomas-cook-customers-back-to-uk

 

The spanish and turkish governments were prepared to put up the money needed, if the UK government gave a guarantee.

[Lockdoctor 10]

12 hours ago, nightrider said:

Interesting twist in the tale:

 

https://www.theguardian.com/business/2019/sep/23/squadrons-start-flying-150000-thomas-cook-customers-back-to-uk

 

The spanish and turkish governments were prepared to put up the money needed, if the UK government gave a guarantee.

The UK Government have made the right decision by not providing funds to tide Thomas Cook over the winter. It's not a surprise Spanish and Turkish Governments were keen not to see a company that provides their countries with so many holidaymakers go bust.

Edited September 24, 2019 by Lockdoctor

[Borista336 0]

16 hours ago, melthebell said:

Interesting read on how and why they failed

 

 

 

apparently a heartfelt thankyou letter was stuck to the window of the Fargate shop

hardly rocket science is it Simon Jack!! i think most sane people would realise a long time ago 1.7bn of debt was unsustainable, what more worrying is the directors and chairman still took huge wages and bonuses , apparently the ceo had£ 8m in the last 5 years! the firm should have been shut down in 2011.

[nightrider 13]

3 hours ago, Lockdoctor said:

The UK Government have made the right decision by not providing funds to tide Thomas Cook over the winter. It's not a surprise Spanish and Turkish Governments were keen not to see a company that provides their countries with so many holidaymakers go bust.

Possibly, depends whether TC was saveable with the right management to turn it around. If so, then it would make sense to give it breathing space. If not then I agree its just throwing good money after bad.

[geared 302]

Close to 2 billion quid in debt and thats immediately after the lucrative holiday season.

 

Writing was on the wall.

[iansheff 86]

Some of he other companies are certainly trying to make a profit out of TC's failure with prices going very high with them claiming it is due to supply and demand. Looked at Olympic last night, the other week there was a holiday to Rhodes for one person  £800+  (way over priced then) now over £1100  and that is for self catering start of October.  I have stayed in the apartments before and they are nice but the prices Olympic are asking are ridiculous. Just had another look this morning and the holiday for one at over £1100 is now £1293, it says that includes a discount of £170 then you have to pay luggage and transfers. 

People who get their money back are certainly going to pay way over the odds, that's if they can afford to  book a holiday to replace the one they have lost.

 

Edited September 25, 2019 by iansheff

[tinfoilhat 11]

14 minutes ago, iansheff said:

Some of he other companies are certainly trying to make a profit out of TC's failure with prices going very high with them claiming it is due to supply and demand. Looked at Olympic last night, the other week there was a holiday to Rhodes for one person  £800+  (way over priced then) now over £1100  and that is for self catering start of October.  I have stayed in the apartments before and they are nice but the prices Olympic are asking are ridiculous. Just had another look this morning and the holiday for one at over £1100 is now £1293, it says that includes a discount of £170 then you have to pay luggage and transfers. 

People who get their money back are certainly going to pay way over the odds, that's if they can afford to  book a holiday to replace the one they have lost.

 

They don't have to though do they?