End of an era: Thomas Cook Collapses

Thomas Cook logo
Thomas Cook Tour Company Logo

A trusted name for over 178 years in tourism and low cost packaged tours has closed its doors. Thomas Cook ceased operations abruptly on September 23, 2019.  Unable to secure funding to cover a massive $2 billion dollars in debt, the tour operator had no choice but to close its’ doors and cease operations.  This stranded more than 150,000+ British travelers that is part of an estimated 600,000 Thomas Cook tourist worldwide.  The British Government had to find ways of bringing its citizens as well as others home and this acquisition of other flights, has been labeled the largest repatriation in peaceful times.  But what does this mean for tourism.

 

Critical information Value
Tourist Stranded 150,000+ British Tourist
Total of 600,000 stranded (tourists worldwide that have used the company)
Cost for Repatriation to the UK Government £ 100 million
Jobs Lost 22,000 (9000 in the UK)
Debt $2 Billion
Future cost to UK tax payer ?? £ millions, possibly billions

 

What will be effected by this shut down is only now being estimated.  The £ (pound) has been weak due to several factors, including Britain’s exit from the EU.  Yet, it isn’t the Brits that are totally to blame for that fiasco.  The EU must shoulder some of the blame for its part in the negotiations of the exit.  I’m not a fully aware of everything that goes on with Britexit, but there are a host of potential reasons why Thomas Cook closed its doors.  Terrorism worldwide, the 2008 recession, financial management in the digital age, failed takeover of MyTravel, and direct competition are just a few of the reasons.  The company had poor strategies to exist in the 21st century.  Travel and tourism has changed.  I can’t help think that the company missed the trends of other travel agencies closing their brick and mortar stores.  Even American Express has closed its travel agencies across the globe because of the digital age.  We just don’t make our reservations anymore in person.  But there was something nostalgic about entering a travel shop and looking at glossy brochures.  Some days I miss that, and I feel disheartened that the oldest tour operator has now closed its doors.

It will be interesting to follow the repercussions.  Let’s look at some videos to understand the background and current situation.  Now, remember to thoroughly investigate this issue.  This is to get you started.

Thomas Cook, Founder
Thomas Cook Founder of Thomas Cook tours
First some history:

Background into the collapse
A comprehensive report about the collapse

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