Youtravel extends suspension of sales as insolvent German parent calls in administrator

Youtravel has extended a stop on taking bookings into a second week after disclosing that some holidaymakers are being asked to pay for their accommodation in resorts following the collapse of German parent FTI Touristik.

FTI confirmed that restructuring expert and lawyer Axel Bierbach, from Munich law firm Müller-Heydenreich Bierbach & Kollegen, had been appointed as provisional insolvency administrator with the “top priority” given to 60,000 holidaymakers currently travelling to destinations.

He will “examine all options as to whether and in what form continuation options exist for the insolvent company and will also explore possibilities for the sale of business divisions in Germany and abroad”.

In a second update from the trade-only bed bank since Monday’s insolvency filing by FTI, Youtravel said: “We are aware of situations where guests in destination are being asked to pay for their accommodation locally. 

“The FTI Touristik failure has resulted in an unprecedented issue in destination and in these instances, we are trying to support where possible by sharing as much information as we can to help our partners resolve the issue for your valued guests. 

“For this issue, we sincerely apologise to both our partners and their customers.

“We have made the decision to extend the cancellations for arrivals up to and including the 14th of June 2024. All active bookings will be cancelled with no cancellation charges by the end of the business day on Friday 7th June 2024.”

The update came as FTI cancelled all trips due to depart until June 10 and stopped taking new bookings. Alternative travel providers are being sought in a bid by a restructuring expert to “find a solution” by July 1. 

Youtravel, which offers accommodation at 27,500 hotels worldwide, described the current situation as “challenging”.

“But we maintain a positive outlook whilst our management team reviews different options to take our business forward,” the statement added. “Our teams are 100% operational and diligently working to keep all partners informed and provide support wherever possible during this time.”

A task force team has been set up to support partners.

Youtravel general manager Matthew Carpenter said: “The collapse of our parent FTI Touristik has created an operational headache for our business and partners. 

“Our focus right now is to support our travel agent partners in any way that we can.

“Cancelling bookings and causing operational issues for our partners is the last thing that we want, but necessary given the circumstances.

“On behalf of the whole Youtravel team I’d like to thank our travel agent partners for the support and understanding during these challenging times and apologise for the operational bottlenecks that this situation has caused.

“I’d also like to commend the work of our own teams within the Youtravel business who are working round the clock to support our partners.

“Youtravel has been a reliable bed bank in the UK market for nearly 20 years and we are exploring all options to ensure that our business moves forward.”

Youtravel added: “Please email , if you need to speak to someone, please call +44 208 588 9914 option 0 then option 1 and hold for an answer or reach out to your account manager.”

FTI, one of the top four travel groups in Europe, insisted that pay for almost 850 staff will be secured until the end of August via “insolvency benefits” and it was co-operating with the German Travel Security Fund (DRSF) to find “the quickest possible solutions” for affected customers.

The fund is mandated to protect affected consumers who have booked a package holiday or trip with associated travel services with FTI Touristik.

Bierbach said: “FTI, the DRSF and I know what a difficult and emotionally stressful situation the holidaymakers affected are now in and together we are doing everything we can to find quick and good solutions for the customers in order to avert as much damage as possible.  

“Top priority would be given to the approximately 60,000 holidaymakers who are currently travelling to the destinations. 

“We are making every effort to ensure that travellers can complete their holiday and return home safely and on schedule.” 

Solutions are currently being sought for trips after June 10 “in order to be able to carry out the trips in an orderly manner”. 

Bierbach added: “We are working at full speed to explore all possibilities to have the booked trips carried out as planned by other travel providers from the earliest possible date.” 

Customers will be informed by FTI as soon as possible as to whether and how this can actually work. 

“We hope to find a solution for travel from 1 July at the latest,” said Bierbach.

The DRSF will take over payments made for services not rendered, “so that package holiday customers do not have to fear that they will lose money due to the insolvency of FTI Touristik,” a company statement said. 

The DRSF will also refund any advance payments made by package holiday customers if it is not possible to carry out these trips. 

The proportion of package tour bookings at FTI is more than 90%.

But the operator added: “It is already certain that new holidays can no longer be booked with FTI with immediate effect” with booking portals switched off on Monday.

While business operations will only continue to a limited extent, FTI employees “are endeavouring to deal with all current issues as quickly and efficiently as possible”. 

A specially expanded call centre has capacities that are still being built up further.

Bierbach has organised initial talks with employees and their works council at the group headquarters in Munich. 

He will inform staff “shortly” about the current situation and the next planned steps. 

The wages and salaries of around 843 employees have been paid until the end of May 2024. Employees are covered by insolvency benefits for the period from June to August 2024 inclusive, according to FTI

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