Business | Tourism
Thomas Cook and Tui sell more holidays after XL fails
Tui and Thomas Cook, the two big tour operators, will gain as the others face greater pressure and do-it-yourself holidaymakers return to package deals, according to Peter Long, Tui Travel's chief executive.
- By Roger Blitz, Financial Times
- Published: 00:02 October 1, 2008
Tui and Thomas Cook, the two big tour operators, will gain as the others face greater pressure and do-it-yourself holidaymakers return to package deals, according to Peter Long, Tui Travel's chief executive.
After Tui and Thomas Cook produced bullish, uncannily similar pre-close trading updates, the fallout from the demise of XL, the smaller rival, this month became clearer, with the big two likely to push up prices and cut capacity further.
Including the past seven weeks of trading, Tui's UK summer 2008 programme is 94 per cent sold, three per cent ahead of the previous year, and underlying prices are six per cent ahead on a 13 per cent reduction in capacity.
Thomas Cook has also sold 94 per cent of its summer holidays, at prices seven per cent above last year and a capacity cut of 10 per cent. Both have sold about a third of their winter programmes and 12-15 per cent of summer 2009, in line with expectations.
Surge in bookings
"We have enjoyed a surge of bookings since the unfortunate collapse of XL and that will continue," Long said. Any softness in demand could be offset by reducing capacity possibly by 15 per cent next summer.
"One of the key changes is the strong will get stronger and the weak will marginalise," he said.
While Tui's share price slid 3.9 per cent, Thomas Cook's was unchanged.
Thomas Cook also said it had purchased £249.5 million of its planned £290 million share buy-back programme and said synergies from last year's merger of Thomas Cook and MyTravel would be above £155 million by 2008-09.
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