Vacation Company Tui Cuts Winter Hours As Bookings Diminish 83% | Business

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Tui, Europe’s largest vacation company, made further cuts to its winter schedule, blaming travel restrictions on evolving as it reported an 83% drop in summer vacation bookings this year.The Anglo-German travel company now plans to operate only 25% of its winter schedule as customers continue to book vacations at the last minute to try to avoid changes in travel advice.

The package tour operator revealed in August that it had recorded a loss of € 2 billion (£ 1.8 billion) in the first nine months of its fiscal year and did not expect bookings return to normal before 2022.

Tui previously announced plans to cut 8,000 jobs and close 166 major travel stores in the UK and Ireland, allowing it to permanently cut costs by 30%.

He said he cut costs by 70% during the lockdown, when he canceled all his vacations.

Tui chief executive Friedrich Joussen said the company took 1.4 million vacationing customers between restarting its travel packages in mid-June and the end of August, but warned that the outlook remained uncertain.

“The availability of destinations at the moment is heavily influenced by government policy and the development of the pandemic, which means the environment remains volatile, and likely will remain so for the next several quarters,” Joussen said.

Like other travel agencies, Tui was under financial pressure to reimburse clients for vacations they could no longer take.

Tui’s UK branch pledged earlier in September to pay outstanding refunds for canceled package vacations by the end of the month, following a deluge of customer complaints to the regulator, complaining that the travel agency did not pay a refund within the 14 days mandated by the consumer. protection law.

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Amid frequently changing travel restrictions, Tui said he wanted to see governments adopt a regional risk assessment policy, rather than blanket travel bans to destinations where coronavirus cases are on the rise, as well as over Covid tests for passengers arriving or departing from a destination.

Tui is “remarkably optimistic given the circumstances,” said Russ Mold, chief investment officer at brokerage AJ Bell, adding that despite his optimism, Tui has seen a drop in booking volumes, vacation prices and capacity.

“There is pressure on cash management in the business as Tui has to balance expenses such as running costs and customer reimbursements with money from new bookings. The current increase in coronavirus cases in the UK and in many parts of Europe suggests that net cash outflows will increase, ”Mold said.

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