Thomas Cook, the world’s oldest tour operator, entered Compulsory Liquidation in the early hours of Monday, 23 September 2019.
There really was a person called Thomas Cook. He started his business in 1841 with a rail trip. He chartered a train to take 500 people all the way from Leicester to Loughborough (about 11 miles) so that they could attend a Temperance meeting. Fare: One shilling per person.
In 1855, Cook set his sights a little further afield. He organised an expedition to Paris, which included not just travel but also your accommodation and meals, thus single-handedly inventing the “package” holiday.
Over the years, the business grew, opening a travel agency in Fleet Street, then passing down first to Thomas’s son then his grandsons. In 1928, when they retired, the business passed to the first of many foreign owners. As package holidays became more and more popular, Thomas Cook grew and grew. It was the grandfather of travel agencies, promising stability and reassurance: “Don’t just book it, Thomas Cook it.”
The company merrily packed people off to Spain, Greece, Egypt… Whether its strict Baptist founder would have approved of the sun, sea and sangria approach to holidaymaking is, however, doubtful.
The 178-year-old company began to come under pressure as the holiday market changed. Its brick-and-mortar high-street stores were undercut by online rivals; low-cost carriers took a bite out of the airline profits. Brexit didn’t help: it pushed the pound lower (and therefore the company’s costs up). Thomas Cook was staring at a loss of 1.5 billion pounds for the six months to March 2019.
What happened in the end was a complicated story involving “restructuring”, “refinancing”, “debt-for-equity swaps” (I have no idea) and the company asking Her Majesty’s Government for a £200 million loan to tide them over.
The Government declined.
So, in a move timed for the early hours of the morning, when the largest number of the 94-strong Thomas Cook fleet of planes was on the ground, the company was forced to shut up shop. That day, a taxpayer-funded repatriation of around 150,000 UK holidaymakers began: the largest ever peacetime repatriation in the history of the United Kingdom.
That Monday alone, the Civil Aviation Authority flew home 15,000 holidaymakers on 64 flights.
That Monday alone, 9,000 Thomas Cook employees in the UK were suddenly without a job.
Who will pay the most for this? The hedge funds, the banks, the directors with their multi-million bonuses?
Of course not. It’s who always pays. The holidaymakers. The taxpayers. The staff.
You and me.