The boss of travel company Tui has said it will fly home customers who are booked on Thomas Cook flights.
The collapse of Thomas Cook, the worlds oldest travel firm, in the early hours of Monday has left more than 500,000 holidaymakers stranded abroad, including 150,000 from the UK. The Civil Aviation Authority has embarked on a huge repatriation, helped by airlines such as British Airways, easyJet and Virgin.
Friedrich Joussen, the Tui chief executive, said in a statement: Tui is preparing measures to support. Where Tui customers are booked on Thomas Cook Airlines flights and these are no longer operated, replacement flights will be offered.
He said the company was assessing the impact of Thomas Cooks insolvency on the final week of its 2019 financial results.
A Tui spokesman said staff were locked in crisis meetings trying to find alternative arrangements for customers who have booked a Tui holiday with a Thomas Cook flight, enabling them to go on holiday where possible, or to fly them home if they are stranded abroad.
We really feel for everyone affected by the collapse of Thomas Cook, he said. We offer a small selection of Tui holidays featuring Thomas Cook flights, as well as a small number of Thomas Cook holidays through our stores.
We are now working alongside the Civil Aviation Authority to assist affected customers and help them to find alternative holidays or organise cancellations and full refunds.
Tui warned that the market remained tough due to the grounding of Boeing 737 Max aircraft which has forced it to lease replacement aircraft, resulting in costs of up to 300m (265m); and continued Brexit uncertainty, which has hit bookings. Airline overcapacity has prompted it to cut the number of its winter holidays, while average prices have gone up 4%. Tui stuck to its previous guidance that this years underlying profits would be 26% below last years 1.18bn.
Tui has fared somewhat better than Thomas Cook, however, because the bulk of its profits come from its own hotels and cruise ships, giving it more control and higher profit margins. It has seen strong customer growth in the last three months for holiday experiences, such as husky sleigh tours in Lapland.
Tui said bookings and prices had improved in recent weeks, which means its summer bookings are flat year-on-year and prices up 1%, with more customers travelling to Turkey and North Africa. It has sold a third of its winter breaks, in line with last year.
Shares in Tui rose more than 7% on Monday after its main competitor ceased trading, and gained a further 1.55% on Tuesday.
Richard Hunter, head of markets at the investment platform Interactive Investor, said: The update delivers proof, if it were needed, that these are tough times in the travel industry.
The demise of Thomas Cook may well present Tui with unexpected opportunities, although it may be some time until such benefits wash through. Tui is a rather different animal from Thomas Cook, with its diversified business model and digital aspirations providing rather more of a defence than the one broken at its former rival.
Russ Mould, investment director at stockbroker AJ Bell, said: Tui is likely to face some extra costs repatriating customers who were booked on Thomas Cook flights. It has also had to cancel some holidays scheduled for the coming weeks where customers were due to fly with Thomas Cooks airline, meaning it will lose some revenue.
But short-term pains will almost certainly turn into long-term gains for Tui. It has a chance to mop up business that would have normally gone to Thomas Cook.