TUI to shed 8,000 jobs as world’s largest holiday company suffers major cash squeeze

TUI ©AirTeamImages

With the COVID-19 pandemic bringing international air travel to a standstill and millions of customers now demanding cash refunds for canceled trips TUI, the world’s largest holiday company has begun what it sees as only the first round of redundancies as it announces 8,000 staff, approximately 10% of its workforce, are being laid off. Despite the fact the German government has already backed a €1.8 billion (US$1.94 billion) loan, the UK government has refused to provide any financial assistance.

The company is struggling under pressure from regulators to ensure that travel agents and airlines strictly adhere to all rules under threat of prosecution. TUI CEO Fritz Joussen said: “It will be a different TUI and it will find a different market environment than before the pandemic. This will require cuts: in investments, in costs, in our size and our presence around the world. We must be leaner than before, more efficient, faster and more digital.”

Under current EU rules, airlines must refund customers within seven days and travel agents within a fortnight. Currently, customers with the likes of easyJet and Ryanair are facing a months-long wait for a refund. As airlines struggle, they are looking for the relaxing of certain customer-protection laws but the International Air Travel Association (IATA) and the Association of British Travel Agents (ABTA) are supporting amendments to the regulations and law. Rafael Schvartzman of IATA said carriers are deeply disappointed that the European Commission has refused to budge. He said: “Millions of jobs are at risk if airlines collapse. Action from the Commission now would safeguard consumer protection and help airlines through the current crisis.”

Email Post to a Friend Email Post to a Friend