From Collapse to Relaunch: Thomas Cook returns
Monday 28th September 2020
In September 2019, the 178-year-old travel operator Thomas Cook collapsed, after last-minute negotiations failed to save the firm, which was crippled by debt totalling over £1.1 billion. This collapse triggered one of the biggest peacetime repatriations, aimed at bringing more than 150,000 British holidaymakers home, and also caused 21,000 jobs to be lost worldwide. However, a year later, Chinese owners Fosun have recently relaunched Thomas Cook in the UK as an online-only business, despite the ongoing coronavirus pandemic.
The Thomas Cook brand was bought for £11 million in November 2019 by the Chinese conglomerate. Fosun, the Shanghai-based group, is using the original name and logo although there are advanced plans to revamp the brand. Thomas Cook is currently employing 50 people, and customers can book holidays online via the Thomas Cook website or over the phone, with this shift online enabling the brand to offer 24/7 customer care.
How can a travel operator relaunch itself in the midst of a global pandemic, where a holiday is one of the last things people are thinking about? The 'Covid-Ready' website is only offering holidays to destinations that UK holidaymakers can return from without having to quarantine (under the UK government's travel corridor list). Customers can choose from all-inclusive to room-only options across a range of hotels from three to five-star (although more options will be available, including multi-stop trips, in the future). Fosun has not disregarded the challenges posed by the pandemic and will therefore not only be focusing on the future and long-term challenges in a struggling market, but also now (the short-term challenges) and overall what they can offer their customers. The new service is described to be flexible, with customers able to change their bookings free of charge. Whilst the relaunch has only happened recently in the UK, Thomas Cook relaunched in July in China, securing more than 170,000 customers so far and being described as a "success", with its growth said to increase once global tourism recovers back to 'normal'.
But are people confident to put their money into a firm that went bust so suddenly last year? Alan French, who was Thomas Cook's group strategy and technology director when it collapsed, has been hired as UK chief executive for the new Thomas Cook. He described the travel agency to have been "reinvented" to a new business, combining "fantastic" customer service with a new operating model protected by ATOL (the Air Travel Organiser's Licence, which is a UK financial protection scheme, protecting most air package holidays sold by travel firms based in the UK). The company has therefore assured customers that their money will not be accessible by Thomas Cook directly, and instead be held in a trust account administered by the Air Travel Trust.
Whilst Thomas Cook is protected by ATOL, who have proven to protect people's holidays, the pandemic has shown that other travel agents who are normally able to secure refunds for cancelled holidays have not been provided the same level of protection. However, the future of Thomas Cook remains uncertain not only for the fact it went bust last year and is trying to make up for lost time and customers, but also because of the ongoing pandemic – with no end in sight, especially for the heavily restricted and reduced tourism market. But the recent success in China might suggest a more positive shift in travel is coming, and that Thomas Cook will once again be a household name for British holidaymakers.
