British Travel Company and airline, Thomas Cook has shut down and declared bankrupt leaving 600,000 people stranded across the world.
Reports have it that the company failed to meet a deadline to secure new funding and so had no choice but to collapse.
Thomas Cook had been trying to avoid collapse after the Royal Bank of Scotland and a range of other banks demanded that Thomas Cook Group PLC find £200 million ($250 million) in funding by this upcoming week.
The news was conveyed by Thomas Cook’s Chief Executive, Peter Fankhauser in a statement released early on Monday morning.
Fankhauser said, “I would like to apologize to our millions of customers, and thousands of employees, suppliers, and partners who have supported us for many years. We are sorry to announce that Thomas Cook has ceased trading with immediate effect.
“This marks a deeply sad day for the company which pioneered package holidays and made travel possible for millions of people around the world. Despite huge efforts over several months, and further intense negotiations in recent days, we have not been able to secure a deal to save our business. I know that this outcome will be devastating to many people and cause a lot of anxiety, stress, and disruption.“
As at the time of the closure, around 600,000 Thomas Cook customers were reported to be traveling, some of whom were scheduled to fly to their destinations with the airline.
An operation was put in motion to solve the crisis on the ground by the British Department for Transport and Civil Aviation Authority under the code name “Operation Matterhorn,” where stranded passengers were assisted to get to their destinations.
However, travelers, who had booked flights, could encounter up to 2 weeks delay in rebooking with another airline. Costs of the flights were expected to be covered by the ATOL or Air Travel Organiser’s License protection scheme, a fund which provides for repatriation of British travelers if an airline ceases to operate.
Threat to tourism: The shutdown has left many people stranded, and at the same time, left fuel suppliers out of pocket. More so, Thomas Cook’s shutdown compelled the closure of its hundreds of travel agents across British high streets.
In order to manage the lingering challenges, British regulator was said to have contacted hotels hosting Thomas Cook customers to tell them that they would be paid by the government through an insurance scheme. That was after some were briefly held in a hotel in Tunisia when staff asked for additional payments to be made.
In Germany, a major customer market for Thomas Cook, insurance companies will coordinate the response.