Thomas Cook Germany has been forced to declare insolvency and cancel all holidays until mid-October but managing director Stefanie Berk hopes to save the tour operator business through a “rebirth” of Neckermann Reisen.
Thomas Cook GmbH, the profitable German subsidiary of the insolvent Thomas Cook Group, announced on Wednesday that it was also declaring insolvency. The company, with some 2,000 employees and three million customers a year, cancelled all booked holidays until October 13, affecting about 660,000 customers with departures up to the end of September. About 140,000 customers of Thomas Cook Germany are currently on holiday.
Insurance company Zurich confirmed that under Cook’s insolvency insurance it would cover the costs of all package holidays booked with one of the company’s tour operator brands, including possible repayment of costs that customers might have had at their destination. However, this does not cover customers who booked individual travel products, including flight-only or hotel-only bookings.
The German Travel Industry Association (DRV) emphasised that hoteliers in destinations had no reason to ask holidaymakers to make any payments out of fear that their costs would not be covered. Moreover, the insolvency insurance company is obliged to organise the return transport of travellers, the DRV added.
In a statement explaining the reasons for its insolvency declaration, Thomas Cook Germany said talks in the last few days with strategic and financial investors, long-standing partners in destinations and travel agencies had shown that Thomas Cook Group’s German tour operator business had the chance of a future.
But the company was “obliged” to declare insolvency with the result that it could now separate itself from its “complex” financial connections with Thomas Cook Group. The insolvency filing would enable the company to restructure and continue trading independently.
Thomas Cook GmbH managing director Stefanie Berk declared: “We would have preferred to avoid this legal step but there was unfortunately no way to negotiate a short-term solution.” She emphasised the company would do everything possible to enable affected customers to return home.
Looking ahead, Berk stated that the “positive feedback” from talks in recent days made her “very optimistic” that the well-established tour operator brands Neckermann Reisen, Öger Tours and Bucher Reisen could “soon” return to the market. The aim of the restructuring was to continue the German tour operator’s profitable business.
The long-serving Thomas Cook manager told fvw that many hoteliers and sales partners had told her that they would support a re-start for the German tour operator business despite the losses they had suffered through the insolvency.
“We plan the rebirth of Neckermann Germany,” she said. This was the well-established name of the German tour operator business until its re-branding as Thomas Cook in the year 2000. Potential investors could include financial investors but also destination partners, she added.
Condor gets €380 million loans
Meanwhile, Condor, the profitable Frankfurt-based German airline subsidiary, has secured commitments for bridging loans worth €380 million from the German federal government and the Hessen regional government to keep operating for the next six months, including the forthcoming winter season.
This move had been widely supported by the German travel industry to avoid a large-scale repatriation operation and retain the carrier as a major competitor to Lufthansa subsidiary Eurowings, TUIfly and other leisure airlines. Condor flies about seven million passengers a year, including one third from Thomas Cook Germany tour operator brands.
Condor now plans to apply for German ‘legal protection status’ in order to separate itself from the insolvent Thomas Cook Group and enable it to seek new owners. CEO Ralf Teckentrup said the airline was already in initial talks with potential investors and was “not starting at zero” in this process.
Thomas Cook Group already planned to sell off its airline business in February but the sale process was stopped due to the planned financial restructuring of the entire group.