Holidays have been cancelled and a mass repatriation is underway as travel company Thomas Cook folds, after 178 years of trading. It's debt had reached £1.6 billion and now 22,000 jobs around the world are at risk, including 9,000 in the UK.
Travel and tourism expert Dr Neil Robinson, from the University of Salford Business School, comments on the reasons behind the demise of the company.
Dr Robinson said: “The events of the last 24 hours shows us the vulnerability of the aviation/travel sectors.
“Mr Cook would be turning in his grave. A lad from Derbyshire who went on to create one of the world’s most recognisable travel brands, which now lies in financial ruin.
“These are very sad times and my heart goes out to employees and customers alike.
“So where did it all go wrong? The downturn in bookings post the Arab spring back in 2010, saw profits drop as people were reluctant to buy travel product associated with this region and the seeds of change for Thomas Cook and the wider travel sector were already being sown.
“Fast forward a few years and the sector has come under many pressures associated with very slim profit margins for each travel product sold, a possibility of too many players in an already saturated market and one might argue that the product mix on offer at Thomas Cook did not align with what its customers really wanted. Their price, promotion and how people actually booked Thomas Cook holidays did not keep pace with changing technology and demand, for example they still had a lot of high street outlets, which incur rental and other costs.
“Thomas Cook's financial strength has not looked good over recent months, with share prices falling, senior managers leaving and would-be bail out loans not materialising, all adding to the creation of a perfect storm.
“Are other companies set to follow? One hopes not, if in doubt make sure your travel provider has ABTA/ATOL protection, pay with a credit card and keep your fingers crossed, this sorry saga is not over yet. In the meantime let us pay homage to the once great travel provider that provided many of us with our first taste of the jet set & holidays overseas.”