TUI is introducing a radical re-branding of its European tour operators and airlines, and is restructuring its management in a major strategic shake-up that will see deputy CEO Johan Lundgren leave the company.
The wide-ranging measures, which also include a new hotel brand ‘TUI Blue’ and an order for two more cruise ships, were unveiled at an analysts event in London today (May 13) following publication of the half-year results and yesterday’s announcement of the new group management structure.
In future, ‘TUI’ should be a ‘European power-brand’ that will gradually replace in two stages the large national brands which the group gained during its many acquisitions over the past two decades. CEO Fritz Joussen told analysts that the aim of the ‘power-brand TUI’ is to offer a harmonised brand experience to customers of the integrated travel group, while other brands will be retained for specialist businesses.
In the first stage, covering Western Europe, the Dutch brand ‘Arke’ will be replaced by ‘TUI’ from September. In Belgium, the brand ‘Jetair’ will be phased out. In France the TUI brand will be introduced and Marmara will be retained as a holiday club concept.
In a second stage, scheduled for 2017, the main British brand ‘Thomson’ and the Scandinavian brand ‘Fritidsresor’ will also be dropped in favour of the group name in Northern Europe markets. In Central Europe, covering Germany, Austria and Switzerland, TUI is already the main brand.
In parallel, the group’s five leisure airlines will take off under the name ‘TUI.com’ in future.
Meanwhile, Europe’s largest tourism group will also introduce the group brand in its hotel activities. The new ‘TUI Blue’ name will become the core brand for the group’s own hotels alongside other well-established names. ‘TUI Blue’ hotels, comprising both re-branded existing properties and new hotels, will be positioned as ‘experience hotels’ for younger, individual target groups. Some 50 medium-sized hotels with this name are planned in the medium-term.
In parallel, the Robinson and Magic Life clubs and the joint venture with Spain’s Riu hotels will be further expanded. At present, TUI has some 360 branded hotels which it either owns (Robinson, Magic Life), part-owns (Riu, Grupotel, Iberotel, Grecotel) or operates as franchises (TUI Best Family, Sensimar and others).
In a separate move to expand its lucrative cruise business, TUI and joint venture partner Royal Caribbean have decided to exercise options for two more vessels, Mein Schiff 7 and 8, with delivery in 2018 and 2019. However, the group will keep its German fleet at six vessels by transferring Mein Schiff 1 and 2 to Thomson Cruises in the next few years to modernise the British cruise fleet.
TUI already announced a major reorganisation of its core tour operating business yesterday (May 12) that cut out an entire managerial level and is designed to speed up decision-making. In future, there will be three regions. Central Europe (Germany, Austria, Switzerland, Poland) and also Destination Services (incoming agencies) will report to board member Sebastian Ebel, who is already responsible for hotels, cruising and IT activities.
The Northern Europe region (UK, Nordics, Canada, Russia) will be headed by David Burling, formerly in charge of UK and Ireland, who will join the group board. He will also be responsible for hotel contracting and the group’s airlines. Western Europe (Benelux, France) will be run by Elie Bruynicnkx, who remains head of the Benelux activities.
The most dramatic consequence of the restructuring is that there is no place in the new structure for deputy CEO Johan Lundgren, who was formerly in charge of the entire mainstream business. He has decided to leave the company as a result.