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The Markets
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The Markets
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Transport

TUI cancels a further 143,000 holidays, BA eyes Gatwick exit

In other travel news a row continues to roil over refunds, while BA has told staff that it may not reopen its Gatwick hub

TUI AG (LON:TUI) has cancelled a further 143,000 holidays as the tour operator extended suspension of its operations due to the coronavirus pandemic.

All beach holidays that involved travelling on or before 11 June have all been scrapped, the Anglo-German package holiday specialist said on Thursday.

With the company having last month suspending “the vast majority of all travel operations”, including aborted all holidays booked to take place before 14 May, it has so far cancelled holidays affecting 900,000 people.

Despite the UK government continuing with the coronavirus lockdown, holidays from late June can still be booked and TUI’s website is still allowing potential customers to book cruise holidays for July, despite the confines of cruise ships having recorded some of the worst coronavirus infections during the crisis.

However, TUI has postponed the launch of Tui River Cruises until the end of November.

Other travel news: refund row

Travellers are estimated to be owed around £7bn for unused holidays and flights.

The industry has tried to persuade the government to guarantee the credit notes as many customers are unwilling to accept credit notes or deferred bookings from tour operator and airlines, due to inability to travel at a later date or worries that the travel companies may fold.

This has led to banks and card operators coming under pressure as they are legally obliged to refund eligible customers.

The Competition & Markets Authority has also said that four out of five complaints it has received during the crisis is related to travel refunds.

Under current EU laws, it is up to the government to enforce the law on whether airlines should issue cash refunds.

This week, a number of EU countries asked the commission to relax the rules so airlines will temporarily be allowed to issue vouchers instead of cash refunds to passengers whose flights have been cancelled due to Covid-19.

Ireland's Taoiseach Leo Varadkar said on Thursday that he was eyeing a return to flights for Ryanair (LON:RYA) and IAG's Aer Lingus by August.

BA bye to Gatwick

In other travel news, International Consolidated Airlines Group's (LON:IAG) British Airways told staff that it may not return to Gatwick airport once the coronavirus pandemic recedes.

The majority of BA's fleet has been grounded due to the virus, but the company told pilots on Thursday that it may also suspend the rest of its Heathrow operations.

An internal memo to pilots said that a quarter of BA's 4,300 pilots are set to lose their jobs, the BBC reported, a day after the company revealed it may make 12,000 BA staff redundant after losing more than €1.8bn in the first quarter of the year.

A day after saying it will take several years for passenger demand to return to 2019 levels, Thursday's memo said: “We need to ensure that our remaining operation is efficient, flexible and cost-competitive to enable us to survive in an increasingly lean and unpredictable industry.”

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