Could we see a new carrier on the block
Join Date: Aug 2014
Location: Outer London
Age: 43
Posts: 604
Likes: 0
Received 0 Likes
on
0 Posts
The age of the High Street travel agent isn’t dead, far from it. The age of the travel agent for mass market package holidays is dead, however. There is a market for the likes of Trailfinders, Travel Centre where actual skilled travel experts that know the world can put together bespoke programmes for those with the money to do it but without the time to think about it.
Join Date: Feb 2017
Location: Glasgow
Posts: 121
Likes: 0
Received 0 Likes
on
0 Posts
The age of the High Street travel agent isn’t dead, far from it. The age of the travel agent for mass market package holidays is dead, however. There is a market for the likes of Trailfinders, Travel Centre where actual skilled travel experts that know the world can put together bespoke programmes for those with the money to do it but without the time to think about it.
I Have Control
Join Date: May 2004
Location: North-West England
Posts: 49
Likes: 0
Received 0 Likes
on
0 Posts
It is not about capacity, that is simply naive. The business is about numbers and margins, which can work out as profit. Expect higher prices.
And anyone who thinks easyJet, Ryanair and the like are low-cost are deluding themselves.
And anyone who thinks easyJet, Ryanair and the like are low-cost are deluding themselves.
The age of the High Street travel agent isn’t dead, far from it. The age of the travel agent for mass market package holidays is dead, however. There is a market for the likes of Trailfinders, Travel Centre where actual skilled travel experts that know the world can put together bespoke programmes for those with the money to do it but without the time to think about it.
High street needs lots of people but market has gone away from it.
The glut means that prices drop because companies would rather make £20 on a holiday than lose £300 that comes with having booked the accomm and nobody going into it. It also means that if there is a glut in holidays in one year, prices drop then following year people assume the same and will hold off until last minute which damages the whole market.
If instead of having 3 million holidays with only 2.6 million bookings there are 2.5 million available holidays with 2.6 million bookings then prices will stay high, there will be little or no discounting and people who wait until last minute will find not much available and then at a premium price. This translates into a lot of early booking for the following year as people panic than nothing will be available.
LC airlines are that, you may disagree but that is where industry puts them.
Join Date: May 2002
Location: SW Scotland
Age: 40
Posts: 413
Likes: 0
Received 0 Likes
on
0 Posts
There's still a lot of money in the Thomas Cook name, despite the bankruptcy.
The biggest challenge with starting a new airline is getting people to remember your name. That's not an issue with the Thomas Cook branding - everyone will recognise it and remember it fairly quickly. Thats going to drastically cut your marketing budget. Most peoples memories are short, by next year they'll have forgot that they went bust, and most will be happy to book with them.
Let's not forget that Thomas Cook raised £900m in investment from their Chinese owners before they went bankrupt - clearly they saw the potential in the investment even in the state the business was in back then - a new startup can cherry pick the best parts of the business, while ditching the loss making parts with no cost.
For clarity, my suggestion is to create two separate businesses. 1) Thomas Cook Airlines. This would exist as an airline only operation, following a model similar to Jet2. Offer flight only options, but also offer package deals including a hotel. Partner with travel agencies to also offer these packages through the stores.
2) An independent travel agency with high street stores. I dont believe the high street travel market is quite dead yet. There are a lot of people who just dont trust buying online (the older generation especially), plus lots of people that just arent clued up on airlines and travel, and need the guidance. These people want to be able to walk in to a store, see the special offers and sit down and chat with an adviser. Thomas Cook had something like 500 stores, and had recently decided to close just 21 of them - we can therefore assume that the rest were reasonably profitable then. 500 might be overkill, but there's definitely room for stores in some of the larger towns.
Normally I would say there was no space in the UK/European market for a new startup, but I think right now there is indeed a vacuum that is yet to be filled. A new entrant getting in quickly has an opportunity to take up some of the spare capacity that has been left in the market. If I had the money.. I'd certainly consider it.
The biggest challenge with starting a new airline is getting people to remember your name. That's not an issue with the Thomas Cook branding - everyone will recognise it and remember it fairly quickly. Thats going to drastically cut your marketing budget. Most peoples memories are short, by next year they'll have forgot that they went bust, and most will be happy to book with them.
Let's not forget that Thomas Cook raised £900m in investment from their Chinese owners before they went bankrupt - clearly they saw the potential in the investment even in the state the business was in back then - a new startup can cherry pick the best parts of the business, while ditching the loss making parts with no cost.
For clarity, my suggestion is to create two separate businesses. 1) Thomas Cook Airlines. This would exist as an airline only operation, following a model similar to Jet2. Offer flight only options, but also offer package deals including a hotel. Partner with travel agencies to also offer these packages through the stores.
2) An independent travel agency with high street stores. I dont believe the high street travel market is quite dead yet. There are a lot of people who just dont trust buying online (the older generation especially), plus lots of people that just arent clued up on airlines and travel, and need the guidance. These people want to be able to walk in to a store, see the special offers and sit down and chat with an adviser. Thomas Cook had something like 500 stores, and had recently decided to close just 21 of them - we can therefore assume that the rest were reasonably profitable then. 500 might be overkill, but there's definitely room for stores in some of the larger towns.
Normally I would say there was no space in the UK/European market for a new startup, but I think right now there is indeed a vacuum that is yet to be filled. A new entrant getting in quickly has an opportunity to take up some of the spare capacity that has been left in the market. If I had the money.. I'd certainly consider it.
Join Date: Mar 2004
Location: Essex, SE England!
Posts: 94
Likes: 0
Received 0 Likes
on
0 Posts
Quite possible, but unlikely with the Ex TCX frames.
Article today highlighting how they only owned 3 A330's, all around 20 years. So they'll be cheap, yes, but how long would they last for?
Link - https://simpleflying.com/thomas-cook-fleet-fate/
Article today highlighting how they only owned 3 A330's, all around 20 years. So they'll be cheap, yes, but how long would they last for?
Link - https://simpleflying.com/thomas-cook-fleet-fate/
And speaking of Airtours, and then MyTravel (which was a rebrand disaster) it was TCX’s acquisition of that mess which many many years later has lead to their demise 😢
There's still a lot of money in the Thomas Cook name, despite the bankruptcy.
The biggest challenge with starting a new airline is getting people to remember your name. That's not an issue with the Thomas Cook branding - everyone will recognise it and remember it fairly quickly. Thats going to drastically cut your marketing budget. Most peoples memories are short, by next year they'll have forgot that they went bust, and most will be happy to book with them.
Let's not forget that Thomas Cook raised £900m in investment from their Chinese owners before they went bankrupt - clearly they saw the potential in the investment even in the state the business was in back then - a new startup can cherry pick the best parts of the business, while ditching the loss making parts with no cost.
For clarity, my suggestion is to create two separate businesses. 1) Thomas Cook Airlines. This would exist as an airline only operation, following a model similar to Jet2. Offer flight only options, but also offer package deals including a hotel. Partner with travel agencies to also offer these packages through the stores.
2) An independent travel agency with high street stores. I dont believe the high street travel market is quite dead yet. There are a lot of people who just dont trust buying online (the older generation especially), plus lots of people that just arent clued up on airlines and travel, and need the guidance. These people want to be able to walk in to a store, see the special offers and sit down and chat with an adviser. Thomas Cook had something like 500 stores, and had recently decided to close just 21 of them - we can therefore assume that the rest were reasonably profitable then. 500 might be overkill, but there's definitely room for stores in some of the larger towns.
Normally I would say there was no space in the UK/European market for a new startup, but I think right now there is indeed a vacuum that is yet to be filled. A new entrant getting in quickly has an opportunity to take up some of the spare capacity that has been left in the market. If I had the money.. I'd certainly consider it.
The biggest challenge with starting a new airline is getting people to remember your name. That's not an issue with the Thomas Cook branding - everyone will recognise it and remember it fairly quickly. Thats going to drastically cut your marketing budget. Most peoples memories are short, by next year they'll have forgot that they went bust, and most will be happy to book with them.
Let's not forget that Thomas Cook raised £900m in investment from their Chinese owners before they went bankrupt - clearly they saw the potential in the investment even in the state the business was in back then - a new startup can cherry pick the best parts of the business, while ditching the loss making parts with no cost.
For clarity, my suggestion is to create two separate businesses. 1) Thomas Cook Airlines. This would exist as an airline only operation, following a model similar to Jet2. Offer flight only options, but also offer package deals including a hotel. Partner with travel agencies to also offer these packages through the stores.
2) An independent travel agency with high street stores. I dont believe the high street travel market is quite dead yet. There are a lot of people who just dont trust buying online (the older generation especially), plus lots of people that just arent clued up on airlines and travel, and need the guidance. These people want to be able to walk in to a store, see the special offers and sit down and chat with an adviser. Thomas Cook had something like 500 stores, and had recently decided to close just 21 of them - we can therefore assume that the rest were reasonably profitable then. 500 might be overkill, but there's definitely room for stores in some of the larger towns.
Normally I would say there was no space in the UK/European market for a new startup, but I think right now there is indeed a vacuum that is yet to be filled. A new entrant getting in quickly has an opportunity to take up some of the spare capacity that has been left in the market. If I had the money.. I'd certainly consider it.
No new airline will get a look in as aside from slots the existing players would kill very quickly. Private Equity who specialise in airline industry already there and nobody going into bat with poor profitability model.
Stores cost £500k a year in cost, some cheaper, some not so.In Whatsapp, tablet / TVs etc you can see and plan your holiday with a full walk around of where you are staying while Brenda in a call centres talks you through all the options and spends an hour with you in Frinton on Sea, after you go away she then talks to Daisy and Bob who wish to go to Turkey who live in Swansea.
High street is already dying on its feet, what will a Noveau TC give you that TUI couldn't ?
It has to be sooo different that people flock in and happily pay a premium price for the service.
Join Date: Mar 2012
Location: Cheshire
Age: 45
Posts: 225
Likes: 0
Received 0 Likes
on
0 Posts
I can't help but think that TUI and Jet2 will be the ones to benefit from this. I don't see a new carrier coming into the market. Both TUI and Jet2 are very very good at what they do and those that did use TC either booking online or going into the shop will now be looking at these two as the alternative. I have always booked with TUI (who I consider to be excellent) and always in store as I feel more comfortable speaking with someone instead of doing it all online so I imagine others will be the same.
The problem TUI has it has no extra aircraft to play with whilst Virgin have already said they could likely bring in Delta and as they have already added a lot of seats for winter ex MAN to BGI, JFK and MCO.
I take it you have read the Virgin press release.
I take it you have read the Virgin press release.
Join Date: Mar 2004
Location: Dorset
Posts: 667
Likes: 0
Received 0 Likes
on
0 Posts
I think the biggest problem any new entrant (whether tour operator or airline) will face will be credit card companies' unwillingness to accept the trading risk. They are already on for taking a bath from the Thomas Cook collapse, and they seriously dislike the travel sector anyway because of the risks involved for them. I'd think any new travel business trying to get credit card processing facilities right now would find this an extremely difficult challenge.
I think the biggest problem any new entrant (whether tour operator or airline) will face will be credit card companies' unwillingness to accept the trading risk. They are already on for taking a bath from the Thomas Cook collapse, and they seriously dislike the travel sector anyway because of the risks involved for them. I'd think any new travel business trying to get credit card processing facilities right now would find this an extremely difficult challenge.
You can bet that there will be claims for refunds from ATOL and also from the CC company for the same holiday.
CC companies can address it by withholding full payment for holidays until their customer is actually going on holiday.
Moving away from the IT "bucket and spade" market for a moment, where is the "new" carrier going to appear from that fills the void on many regional business routes that FlyBe are shedding in the present route cull? The history of small regional start-ups isn't great, there is a thread running in the AH+N on failed British carriers, and the number of failed airlines set up to serve business routes from outside of London tends to suggest that, perhaps for a number of reason, not least the concentration of business in London and the southeast of England, the segment simply isn't sustainable. OK, Loganair has stepped in and picked up a number of routes between Scotland and the rest of UK, but are they really equipped to take on routes out of, say, Southampton, Birmingham and Manchester to major mainland European business centres and make a profitable fist of them? Personally, I doubt it.
Post Brexit, the opportunities for groups like Air France / KLM or Lufthansa to move in to the UK are more limited (given ownership rules possibly impossible), so perhaps the best hope is for those European groups to serve the UK regions with their own in house carriers, such as Air Dolomiti, Austrian or Brussels Airlines.
More far fetched, would Jet2 see opportunities for developing less leisure orientated routes such as BHX or MAN to Milan or Berlin, perhaps bringing in a small fleet of E-jets?
Or, are business passengers from the Midlands northwards to be expected to do all their flying over hubs, be they LHR, AMS, BRU or CDG? Is that really the only way forward?
More questions than answers I'm afraid!
Post Brexit, the opportunities for groups like Air France / KLM or Lufthansa to move in to the UK are more limited (given ownership rules possibly impossible), so perhaps the best hope is for those European groups to serve the UK regions with their own in house carriers, such as Air Dolomiti, Austrian or Brussels Airlines.
More far fetched, would Jet2 see opportunities for developing less leisure orientated routes such as BHX or MAN to Milan or Berlin, perhaps bringing in a small fleet of E-jets?
Or, are business passengers from the Midlands northwards to be expected to do all their flying over hubs, be they LHR, AMS, BRU or CDG? Is that really the only way forward?
More questions than answers I'm afraid!
Join Date: May 2002
Location: SW Scotland
Age: 40
Posts: 413
Likes: 0
Received 0 Likes
on
0 Posts
So anyway... any new entrant wont have an issue here.
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.
So anyway... any new entrant wont have an issue here.
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.
Join Date: Apr 2012
Location: ESSEX
Posts: 274
Likes: 0
Received 0 Likes
on
0 Posts
Thomas Cook 1.2. Would have more chance of making it by booking package holidays for people and off loading the flights part onto dedicated carriers. Stick to the volume block booking of hotels and leverage the passenger numbers to get cheaper seats on Easy and the rest