Thomas Cook holidaymakers face 24-hour scramble to get home as firm gives up hope of private rescue
THOUSANDS of Thomas Cook holidaymakers could have just 24 hours to get home or face being stranded abroad as the Brit tour operator goes bust.
The UK’s oldest travel agent is reportedly close to abandoning hope of a private rescue deal with fears it could collapse by Sunday.
Thomas Cook had hoped to keep its airlines in the UK, Germany and northern Europe out of administration while letting its British tour operating arm fail, Sky News reports.
But the plan was seen as being too complex – with the company still scrambling to plug its £200million funding gap.
Holidaymakers who are booked on flights only could now be stuck abroad if they don’t make it home in the next 24 hours.
Those on a package holiday are ATOL-protected – meaning the government would be forced to launch the biggest peacetime repatriation of British citizens at an estimated cost of £600million.
MASSIVE JOB LOSSES
Were the 178-year-old company to go bust, some 9,000 British jobs potentially could be lost, and 21,000 worldwide.
A source said of the 178-year old travel agent: “Around 20,000 staff worldwide will lose their jobs and it will have a knock on effect to travel agents worldwide as cruises will also be affected as they may also lose their licence.
“Several thousand passengers on cruises may also have holidays cut short, stopped part way through holidays and needing assistance in returning.”
COOK LATEST Thomas Cook rescue deal – What you need to know before booking a holiday
The troubled operator hoped to seal a rescue led by China’s Fosun, owner of Club Med, this week.
But its lenders, which include about 10 banks led by taxpayer-saved Royal Bank of Scotland, demanded the travel company find an extra £200m.
If the company cannot secure the extra funding it risks going bust.
The travel firm has suffered recently as a result of mounting debts, reporting a £1.2billion net debt in its half-year results in May.
A source said: “Thomas Cook is critical. It’s touch and go.”
The Civil Aviation Authority last night dodged questions about the suggestion it was not about to renew the firm’s license to operate.
Thomas Cook is critical. It’s touch and go
The sunshine flight firm will go bust from October if the license is not granted, leaving Brits stranded overseas.
An estimated 180,000 people could be stuck abroad.
It will also wreck the plans of hundreds of thousands of families who have booked Thomas Cook flights or holidays.
An insider told The Sun: “Thomas Cook has been refused the licence renewal for October onwards after failing to provide solid proof that they can operate for the following 12 months.”
The source went on: “The CAA has put measures in place including staff and replacement aircraft to assist with repatriation and customer service for the 14 day period following the grounding of all Thomas Cook aircraft.
“Replacement aircraft will depart from various airports, some from the Middle East that are currently not being used due to their routes current being suspended in and out of certain countries.”
What would happen if Thomas Cook collapsed?
Thomas Cook is one of the world’s largest travel companies.
It was formed by a cabinet maker of the same name.
Mr Cook organised his first trip in 1841, taking around 500 supporters of the temperance movement on a day trip by train from Leicester to Loughborough.
His first commercial venture was an outing to Liverpool in 1845, before expanding to overseas trips in 1855.
If Thomas Cook does collapse, the Civil Aviation Authority is expected to launch a major repatriation operation to fly home UK holidaymakers stranded abroad.
This will involve hiring aircraft at a cost to taxpayers of millions of pounds.
When Monarch went bust in October 2017, the Government spent £60 million getting passengers home.
Customers who booked a package holiday through Thomas Cook will be financially protected through the Atol scheme.
That means those already abroad will be able to continue with their holiday and an alternative flight home will be organised for them.
Those with future bookings will be offered a full refund.
Anyone who bought a flight-only deal through Thomas Cook is likely to have to contact their credit or debit card provider in a bid to get their money back.
The Sun source said Thomas Cook flights which have not left the runway come midnight on Sunday will remain grounded.
Sources said the Civil Aviation Authority will arrange staff to operate 24/7 phone lines for passengers needing assistance.
Earlier this week Thomas Cook filed for bankruptcy protection to avoid lawsuits by creditors in the US.
The travel firm was said to be in the final stages of hammering out a rescue deal.
The firm’s lawyers Latham & Watkins filed for Chapter 15 court protection under US bankruptcy law in New York.
It protects foreign companies from US lawsuits, and meant Thomas Cook could continue working as part of its process for survival.
If the travel firm goes bust it would led to the biggest ever repatriation since the 2017 collapse of Monarch Airlines.
MOST READ IN TRAVEL
The company announced in August that it was planning to sell parts of its business to Chinese firm Fosun, which is already the company’s largest shareholder.
The Chinese firm said it will contribute £450 million of new money to the UK travel firm, and buy 75 per cent of the company’s tour operator business and 25 per cent of its embattled airline business.
The remaining £450m was meant to come from group leaders and bondholders.
