Originally Posted by
nighthawk117
This is already the way it works - this is why it's recommended to purchase flights with a credit card. When you do so, the payment is transferred off your card to a payment processing company, which holds the funds until the flight is completed, only then do the airlines get paid. So the credit card companies aren't on the hook for anything here, the money is just being held in escrow and will be returned.
So anyway... any new entrant wont have an issue here.
Which means that ATOL should not be in the tank for £400 million. BTW thanks for clarifying that element, aware of some of it but not fuly sure.
Only problem will be operational cash flow and getting customers wanting to go with a newbie, with zero reputation, wanting to charge a premium price. Why a premium price becaue it needs to be profitable.
Of course it go launch at rock bottom prices designed to get people to book and work on basis that in year 3 it would become profitable. This would need circa £1 billion in cash to cover year 1 and 2 losses to get there. But as holiday makers are promiscuous / price tarts (in choosing holidays not what you were thinking)
. When you get to year 3 instead of £550 pp on the costas in August you are paying £1000 and TUI / Jet2 has it for £750 then do you go back to loveable company who gave you cheap holidays for 2 years or do you pocket the £1000 saving and go with TUI / Jet2. I think we all know the answer to that one.