The oldest travel provider Thomas Cook stands in front of the From. Tourism expert Torsten Kirstges explains in an Interview in DW, of how it came about and how the bankruptcy will affect the industry.
DW: With the UK travel provider Thomas Cook has taken one of the Big players in the industry – more than 20,000 employees around ten billion euros in annual sales. How could it come to bankruptcy?
Torsten Kirstges: The has a long history. Thomas Cook has already had around the turn of the Millennium, huge economic problems and was already on the verge of bankruptcy. With drastic measures, the group was saved then, but has carried an enormous burden of debt which he could not reduce it. Then, when liquidity shortages, fluctuations in the business, special influences such as the uncertainty came because of the Brexit etc., could not be mitigated, the.
There is a Trend away from package tourism to more individual tourism? And that is another reason for the collapse of Thomas Cook?
No, I don’t see a Trend. At least in Germany, the proportion of package tourists in all types of holidaymakers is actually unchanged. About half of the tourists take package tours, while the other half organize your trip yourself. Under the package travel also module solutions, customised package tour, so all travel is carried out by the organizer supports are. Providers of vacation packages to go with the time. Today it is desired by the customer more flexibility and individualization. This is to implement for a large company may be more difficult than it is for a mid-sized company that is placed per se to be a bit more flexible.
Torsten Kirstges does not believe that, in spite of the collapse of Thomas Cook’s package tours are available before the end of
The providers offer both flights and overnight Stays, with dumping prices. What is the role of the price war plays in the industry for the end of Thomas Cook?
The margins have been under pressure. The industry advertises with the price, less with the quality or other Strengths of the package. The margins of each operator are low. And they are the smaller, the replaceable, the product is. If I offer mainly classical bath package travel, i.e., flight, Transfer, Hotel and meals, then I’m very interchangeable and therefore very well comparable. The result is that the price pressure and thus the pressure on margins is without a doubt is very strong.
There are actually insights on the kind of tourism is more harmful for the climate? Individual or package?
You can’t make to the organization form. Depends on the nature of the transport. Most harmful for the climate of course travel flight. If I is the on your own or with a tour operator book, climate balance sheet will be negligible. The climate discussion has certainly not led to a company like Thomas Cook in trouble.
The 150,000 British and the others are stranded and need to be retrieved. Who pays for the whole cost?
There is a mandatory insolvency protection. This is one of the great Strengths of the package and one of the great advantages of the EU, the want to leave the British Yes. All operators must have a insurance to ensure that, for example, in a bankruptcy case, the travel supplier, the customer secured funds. Thus, customers have not yet travelled to get their money back and customers that are already on the journey, be transported back. Especially the enormous size is of course. With such a magnitude the industry has not had to fight so far in the case of insolvencies still to. Since not it can well be that the covered sum insured is sufficient. This is of course again a very exciting story.
We has a Bust of Thomas Cook to the Rest of the industry?
Even if in Germany, Thomas Cook survive brands for the time being, is unlikely to book a trip to the office and hardly a customer of Thomas Cook brands, such as Neckermann and Bucher. Because the travel agencies are not covered by the bankruptcy protection, you need not to worry anymore to get your commissions. So it will definitely have an impact on the existing brands of the group. This will probably go sooner or later into bankruptcy. The other tour providers are the laughing third. Of course, the customer is generally not less vacation. You will look around but in the case of other operators. It is not only TUI, one of the biggest competitors of Thomas Cook, but also, certainly, some medium sized companies will benefit.
The trips will be with less providers, more expensive?
This doesn’t have to be. There is a strong market pressure among the organizers – especially in the case of interchangeable, with little individual trips. Should, however, be in fact, the Condor is still – what is not yet the case today – could flight capacity are scarce. That would of course lead to short-term increases in the price of flights. But we have also seen, as Air Berlin disappeared from the market, the left quickly by other solutions field.
To what extent has fuelled the debate about the Brexit, the Bankruptcy of Thomas Cook?
I would say that the Brexit is not as fundamental, but rather as a last nail in the coffin. The uncertainty in the British travel market is also due to the uncertain exchange rates. The British pound is weak. Overall, the increased uncertainty has pushed the demand in the travel market a little bit. Add to this: After the summer season, the organisers have to pay their service providers. In this time all the bills come in, and at the same time, there is relatively little new bookings. Because the autumn and winter business is not quite so large as the summer business. As a result, a structural deficit that was built up over the years through so now suddenly very strong. The uncertainty about Brexit, or because of fluctuations in the exchange rate will then be the last drop that brings the barrel to Overflowing.
Torsten Kirstges is a Professor for tourism Economics at the Jade University in Wilhelmshaven.