TUI is poised to cut 2,600 jobs in the UK, with the axe to fall primarily on retail staff in its 700-plus shops.
They are likely to bear the brunt of 3,600 job losses announced by TUI UK’s German parent company on Thursday as the UK leads the way in the move to de-package holiday sales.
Profit margins on sales of separate holiday components are lower than on traditional packages and these now account for 40% of UK sales.
TUI UK said it had yet to draw up plans for the retail job cuts. But it said 900 of the job losses would come from reductions in back office staff already under way. The remainder would be made “over the next two of three years”, it said. However, a statement by TUI Germany said the cuts would be made by 2008.
Group chief executive Michael Frenzel said agencies would remain the key distribution channel in Germany, but significantly did not say this of UK. As a consequence, only 400 jobs will go in Germany
The UK job losses form the lion’s share of a Euros250 million cost-cutting programme next year as the group is restructured.
UK airline Thomsonfly and the group’s carriers in Germany will be rebranded as TUIfly.com, and a TUI Cruises brand will be established in a joint venture with Carnival to target the high-volume, premium cruise market.
TUI will also seek to reduce its debt by Euros1 billion.
Group chief executive Michael Frenzl said the cuts were being made “from a position of strength”.