Thomas Cook getting sevco'd

[Bishop Briggs]

^ Best of luck. Hope Thomas Cook are still in business on Sunday.

[djchapsticks]

I'm of the hopeful mindset that if administration was unavoidable, we'd have already been there by now.

I can see this dragging out for several more weeks yet.

[Bishop Briggs]

15 minutes ago, djchapsticks said:

I'm of the hopeful mindset that if administration was unavoidable, we'd have already been there by now.

I can see this dragging out for several more weeks yet.

It can't drag out for very long. The ATOL licence expires in 1st October.

I'm wondering whether the banks are trying to "do a Debenhams" and screw Fosun like Mike Ashley. 

[DeeTillEhDeh]

Obviously. The company must be aware of the EU laws.
TUI, with its own financial woes, will be looking to raise prices if Thomas Cook goes into admin. It will be ready to fight any Government subsidies. 
The CAA has to underwrite the £600 million cost of repatriating Thomas Cook's customers. The Treasury will looking for a legal solution to avoid that huge bill.

The £600 million is just the cost of repatriation - add in those holidays that are ATOL protected and have to be compensated and you could be looking at a bill in excess of £1 billion.

£200 million looks trifling in comparison - any sensible government would be doing everything they can to avoid that bill.

[DeeTillEhDeh]

It can't drag out for very long. The ATOL licence expires in 1st October.
I'm wondering whether the banks are trying to "do a Debenhams" and screw Fosun like Mike Ashley. 

It's either that or forcing them to put even more in.

[Shannon]

Got flights to LA booked for honeymoon via Thomas Cook for a road trip around California in just over 2 weeks time. Hopefully they get it all sorted. Been looking at alternative flights if worse comes to it and available at similar price currently.... Paid by credit card so hopefully will just be refunded if worse comes to it and quickly purchase new flights before they sell out / get too expensive!

 

If Government do bail them out would be some good vote winning publicity for them. You know you want to [emoji849][emoji23]

 

 

[DeeTillEhDeh]

Seems to be contradictory reports coming out - some saying talks are still going on (including the government) whilst others, particularly the Murdoch press, are saying they have collapsed. The problem with that lot is telling if that is true or just their usual sensationalism.

We'll hopefully know soon enough.

If things are the worst case scenario then I'll be checking if TUI up their prices.

[Bishop Briggs]

13 hours ago, DeeTillEhDeh said:

The £600 million is just the cost of repatriation - add in those holidays that are ATOL protected and have to be compensated and you could be looking at a bill in excess of £1 billion.

£200 million looks trifling in comparison - any sensible government would be doing everything they can to avoid that bill.

Agreed but, as I stated above, any Government cash injection must comply with EU state aid and competition laws.

RBS, being Government owned, will come under EU scrutiny too. Soft loans or preferential terms are not allowed.

Competitors such as TUI, Jet2, Ryanair and Easyjet will look at any deal very closely.

[Jacksgranda]

23 hours ago, DeeTillEhDeh said:

I'm meant to be travelling on 6 October to Tunisia - thankfully ATOL protected plus, for insurance, paid by credit card - ironically an RBS credit card.

 

Will get all my money back if they fold - might even get the extras like airport parking back as well:

 

https://www.moneysavingexpert.com/news/2019/09/thomas-cook-seeking-p200m-extra-funding-/

 

I suspect this might be RBS and Lloyds trying to strong arm more money from Fosun.

 

Although I'm annoyed at this I do feel for the employees who are going through this. It's also doubly annoying that the two banks doing this just happen to be ones who were bailed out by HM Government during the banking crisis. A sensible government might step in - but I'm not sure here - crazy considering that the cost of repatriation of holidaymakers and compensation will dwarf the £200 million needed.

 

 

 

 

initially. What more will have to be pumped in to keep it going?

[Bishop Briggs]

54 minutes ago, Jacksgranda said:

initially. What more will have to be pumped in to keep it going?

Fosun and the banks were planning to put in £900 million. The banks now want an extra £200 million in capitalisation. Thomas Cook want the Government to cough up but that would breach EU state aid laws.

[DeeTillEhDeh]

Agreed but, as I stated above, any Government cash injection must comply with EU state aid and competition laws.
RBS, being Government owned, will come under EU scrutiny too. Soft loans or preferential terms are not allowed.
Competitors such as TUI, Jet2, Ryanair and Easyjet will look at any deal very closely.

Boris could state that they get it on 31 October . . .

[doulikefish]

https://www.independent.co.uk/news/business/thomas-cook-share-price-profit-loss-results-brexit-travel-flights-a8916061.html

[welshbairn]

10 hours ago, DeeTillEhDeh said:

20 hours ago, Bishop Briggs said:

Agreed but, as I stated above, any Government cash injection must comply with EU state aid and competition laws.
RBS, being Government owned, will come under EU scrutiny too. Soft loans or preferential terms are not allowed.
Competitors such as TUI, Jet2, Ryanair and Easyjet will look at any deal very closely.

Boris could state that they get it on 31 October . . .

WTO rules are said to be pretty similar.

[DeeTillEhDeh]

Last-ditch meetings with creditors, suppliers and government this morning. If they don't get a deal they will go into administration early on Monday morning - they can't go into administration unless all their planes are on the ground.

[djchapsticks]

12 minutes ago, DeeTillEhDeh said:

Last-ditch meetings with creditors, suppliers and government this morning. If they don't get a deal they will go into administration early on Monday morning - they can't go into administration unless all their planes are on the ground.

I've got everything crossed - flight is tomorrow at 10:30am.

If it all goes tits up, credit card have already confirmed they will refund flights in full but need to get alternative ways to get out there. At time of writing, Glasgow to Miami (via Heathrow) on Tuesday morning is the best bet then 4 hour drive to Orlando.

Desperate times though, this weekend was meant to be a breeze through to the holiday and it's just been a combination of worry and anxiety.

[Bishop Briggs]

2 hours ago, doulikefish said:

https://www.independent.co.uk/news/business/thomas-cook-share-price-profit-loss-results-brexit-travel-flights-a8916061.html

Lots of companies have blamed Brexit uncertainty for their management's incompetence. The massive losses were due to the write-down in the value of MyTravel.  Prior to the merger, MyTravel had bought American, Scandinavian and Danish holiday businesses. MyTravel was over-valued in the merger, hence the write-down. Thomas Cook has lost business to its competitors in many countries which has resulted in trading losses.. 

Following the merger, only around 20-25% of Thomas Cook's customers are British. The rest (75-80%) are from 15 other countries. Thomas Cook has 22,000 employees but only 9,000 are based in Britain. It's major shareholders are Chinese and German but only Britain is being asked for the bailout! f**k that!

Edited September 22, 2019 by Bishop Briggs

[DeeTillEhDeh]

Lots of companies have blamed Brexit uncertainty for their management's incompetence. The massive losses were due to the write-down in the value of MyTravel.  Prior to the merger, MyTravel had bought American, Scandinavian and Danish holiday businesses. MyTravel was over-valued in the merger, hence the write-down. Thomas Cook has lost business to its competitors in many countries which has resulted in trading losses.. 

Following the merger, only around 20-25% of Thomas Cook's customers are British. The rest (75-80%) are from 15 other countries. Thomas Cook has 22,000 employees but only 9,000 are based in Britain. It's major shareholders are Chinese and German but only Britain is being asked for the bailout! f**k that!

It's surprised me that Fosun aren't doing more - they seemed desperate to expand their European market beyond Club Med.

 

For a conglomerate their size the level of capital required is peanuts in the big scheme of things.

 

You would hope that this is who blinks first between Fosun and RBS/Lloyd's - but it just doesn't seem to be that.

 

Even if they survive there would need to be a major restructuring - would not be surprised if they removed their High Street presence and became a completely online business.

 

Whatever happens you can expect there to be another hike in holiday prices.

 

[Bishop Briggs]

25 minutes ago, DeeTillEhDeh said:

It's surprised me that Fosun aren't doing more - they seemed desperate to expand their European market beyond Club Med.

For a conglomerate their size the level of capital required is peanuts in the big scheme of things.

You would hope that this is who blinks first between Fosun and RBS/Lloyd's - but it just doesn't seem to be that.

Even if they survive there would need to be a major restructuring - would not be surprised if they removed their High Street presence and became a completely online business.

Whatever happens you can expect there to be another hike in holiday prices.

Agree about Fosun. It's hard to believe that it would simply abandon its huge investment.

On restructuring, the same applies to TUI. The rise in rents and business rates will make more shops unprofitable.

Not sure about completely online - it's not for everyone. The independent travel agents, like Stewart's in the Briggs, are important outlets. 

Selling off the airlines, or cutting back on the fleets, could help too. There's too much capacity and, as a result, fares are too low. 

Prices will have to rise as they are unsustainable. Some of the all inclusive deals are crazy. More charging for transfers is likely.

Edited September 22, 2019 by Bishop Briggs

[DeeTillEhDeh]

Agree about Fosun. It's hard to believe that it would simply abandon its huge investment.
On restructuring, the same applies to TUI. The rise in rents and business rates will make more shops unprofitable.
Not sure about completely online - it's not for everyone. The independent travel agents, like Stewart's in the Briggs, are important outlets. 
Selling off the airlines, or cutting back on the fleets, could help too. There's too much capacity and, as a result, fares are too low. 
Prices will have to rise as they are unsustainable. Some of the all inclusive deals are crazy. More charging for transfers is likely.

They could have no outlets but use the independents to sell on holidays instead - would certainly be more cost effective.

We'll know soon enough I fear.

[Boghead ranter]

What I have never got, and still don't, is that all the excuses for being in the shit that they are trotting out are factors that affect the entire travel industry, not things unique to Thomas Cook.

How come Tui,  Jet2 etc aren't all on the brink of admin, despite Brexit, heatwaves etc?

Maybe the way the company has been run for the last 10+ years (at least) might be a factor.

Edited September 22, 2019 by Boghead ranter