Having known Karen Vyse, the managing director of Holidays 4U, for nearly 25 years, I was genuinely sad to hear of the company’s demise, both for Karen and for her staff in the UK and overseas.
When a direct competitor fails other operators always benefit, and in this instance we decided to stick with the same volume and adjust prices as opposed to increasing volume – it was too dangerous to pile on more capacity.
Turkey was the flavour of the season in 2010. Two things always happen when a destination becomes popular: hoteliers increase prices for the following year and the airlines and tour operators increase capacity.
This time those problems were compounded by tour operators moving extra capacity into Turkey because of the situation in North Africa and Egypt. On top of that, it was already difficult to move volume due to the difficult economic situation in the UK.
In May and June, thousands of seats went empty and even more were sold below £100, with one of the vertically integrated companies selling one-ways for £59. The actual cost of seats with tax, load factors and empty legs taken into account is approximately £240. Something had to give.
We took the decision to reduce volume for summer 2011 as we were very concerned about what was likely to happen. It was one of our better decisions – we knew that the trading environment was about to get very difficult for Turkey specialists without a strong secondary destination or deep pockets, and that casualties would no doubt be the result.
What has made me particularly sad, however, are some of the inaccurate comments being posted on websites. Holidays 4U was not a scam. It was a company with good people who worked hard and who, in the end, simply could not compete in this difficult market any longer.