What the industry is saying about Thomas Cook collapse
The failure of UK travel company Thomas Cook has raised a multitude of issues. The UK Civil Aviation Authority (UKCAA) tweeted that all Thomas Cook bookings had been canceled, leaving tens of thousands of customers stranded, stuck, or with huge losses in terms of holiday cash already spent scheduling their vacations.
British government officials have vowed that no travelers will be left stranded. The UKCAA is reportedly organizing repatriation flights. But for travelers, resort properties, and destinations, flying people home is just the tip of the ice berg in the Cook collapse.
U.S. travel agents, like many in the travel industry, were surprised by the collapse of Thomas Cook – Britain’s oldest travel agency and travel services firm. This shocked reaction was just about universal, but in reality, the company’s failure did not suddenly happen overnight.
What tour groups and agents are saying
“I saw their stock plummet in the past three years,” said Jennifer Doncsecz of VIP Vacations. “I believe it went from $140 per share to less than $2 just two weeks ago,” she said. “When you look at a company that had a 175-year history with over $15 billion in sales annually and 19 million customers a year, it is baffling at how quickly it deteriorated.”
Thousands of vacationers with deposits on Thomas Cook travel bookings are scrambling to figure out what they will do in light of this collapse. This is likely going to affect visitor arrivals at many destinations, the Caribbean included. The Caribbean has always been a popular destination for UK travelers.
“The initial hit will be for those reservations that Thomas Cook hasn’t processed (including) payments to the resorts and the service has already been consumed,” said Tom Carr, owner of Preferred Vacations.
“The midterm concern is what happens to future (deposited) bookings. Does (UK travel firm) TUI or another provider step in, or will the resorts need to bring the bookings direct?” Carr said. “This is reminiscent of the collapse of Club America in the U.S. market, only much larger.”
TUI had booked some of its clients aboard Thomas Cook-operated flights. “We are sorry to learn that the UK tour operator and airline Thomas Cook has collapsed,” says a statement on the TUI web site.
“As we offer a small selection of TUI holidays featuring Thomas Cook flights, as well as selling a small number of Thomas Cook holidays through our stores, we’re now working alongside CAA to assist affected customers,” the statement continues.
“If you are currently on a TUI or First Choice holiday and were due to return home on a Thomas Cook flight, please visit thomascook.caa.co.uk for the relevant and up to date information for your new travel plans.”
In the Caribbean
“This will definitely impact the Caribbean,” added Kelly Fontenelle-Clarke, a Caribbean travel marketing consultant. “Thomas Cook did operate in the Caribbean and was a major contributor to the arrival number. This will certainly put a dent in the Caribbean arrivals,” she said, “especially as we are heading to the winter period.”
“It will have a huge impact on the Caribbean, especially on the resort side,” said Carr of Preferred Vacations. I’ve already seen a FB post from Sandals in the UK with a hotline for anyone with reservations.”
Doncsecz of VIP Vacations said Thomas Cook’s collapse was due in part to events beyond its control: “We all know how outside world events can make companies topple. Their market to Egypt – especially the beach areas – became non-existent following the Arab spring.” She also referenced “the rise of consumers booking online” and a shaky structure. London city along had previsouly employed 500 agents. “They made poor choices with acquisitions which consumed their liquidity. Some might also attribute (the collapse to) poor restructuring and high debt. The immediate impact for the Caribbean will be a good deal less than for Mediterranean and U.S. destinations.”
She added: “The aftershock of Thomas Cook’s demise is the real concern as it will undoubtedly affect other tourism suppliers and companies due to unpaid bills, loss of business, etc. It is here that the Caribbean may suffer. For U.S. travel advisers, we should watch and learn. Having a plan for tough times in the market that could slow down businesses, advising our clients to purchase travel insurance and utilizing companies (tour operators) that have a solid financial history are critical.”
“This is an eye-opener for all operators at this time,” said Fontenelle-Clarke. “Thomas Cook was a staple in the travel industry being in the business since the 1800s.”
No comments have been made by Sandals officials or Barbados Tourism.