Travel industry in 'greatest turmoil in 30 years' after Paris attacks, says Thomas Cook boss

The travel industry is facing the greatest turmoil in 30 years because of the recent series of incidents capped by the terrorist attacks on Paris, said Thomas Cook chief executive Peter Fankhauser.

He pointed to a “string of external shocks” including the killing of 38 holidaymakers in Tunisia in June and the bombing of a Russian plane flying from Egypt that killed all 224 people on board last month.

Those terrorist attacks were followed by the murder of 130 people in Paris last week. International tensions increased on Tuesday when Turkish aircraft shot down a Russian fighter over Turkey’s border with Syria.

Fankhauser, who has run the tour operator for the past year, said: “There is an unprecedented level of disruption in [more] of our markets. In my 30 years in the industry I have never seen anything like it.”

He said Thomas Cook had experienced a fall in bookings from France and other European countries after the Paris attacks. But he said he expected confidence to return quickly, as it did after other incidents such as the deliberate crashing of a Germanwings passenger plane by its co-pilot in May.

“If you have a shock like Tunisia or the Germanwings crash you have a decline in bookings because people don’t want to think about holidays immediately. The confidence is coming back quite soon. This is what we had in our experience of the last shocks.”

His comments echoed those made by Carolyn McCall, the boss of easyJet, who said last week that the budget airline had seen a drop-off in passengers flying in and out of France but that travel was such a big part of people’s lives that the desire to fly would resume soon.

Thomas Cook has cancelled flights to Egypt until December and Fankhauser said he would follow government instructions at a meeting scheduled for Wednesday. EasyJet and British Airways’ owner IAG have already delayed any flights to Egypt until January.

Fankhauser was talking as he unveiled Thomas Cook’s first annual net profit for five years, during which the company almost collapsed. He said the company was at a turning point despite the turbulent backdrop.

For the year ended 30 September, Thomas Cook swung to a post-tax profit of £19m from a loss of £115m a year earlier. Pre-tax profit was £170m, compared with a loss of £114m the year before.

The company’s shares rose almost 10% to 108p.

Performance was driven by good business in the UK, where underlying earnings rose 42% to £119m. The current year has started well with strong winter holiday trading in the UK and northern Europe, the company said. It is launching a new brand, Casa Cook, aimed at urban professionals as it seeks to move upmarket.

As well as facing financial problems and external shocks, Thomas Cook was beset by an outcry over its treatment of the family of two children who died at a hotel booked through the company in 2006. Christi and Bobby Shepherd were killed by carbon monoxide poisoning caused by a faulty boiler at a bungalow attached to a hotel in Corfu.

After almost a decade during which the company kept the children’s parents at arm’s length, Fankhauser apologised in May and agreed to work with Sharon Wood and Neil Shepherd. Last week Thomas Cook launched a Safer Tourism Foundation with the support of Sharon Wood.

Fankhauser said: “The past year has also presented considerable challenges for Thomas Cook as we confronted the mistakes that were made following the deaths of Bobby and Christi Shepherd in Corfu nine years ago. The fact that I have got to this stage with Sharon says a lot about how far we have come.”

Powered by article was written by Sean Farrell, for on Wednesday 25th November 2015 11.18 Europe/ © Guardian News and Media Limited 2010


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