Brexit had ‘no impact’ but terror ‘changed industry’ says Cook chief

The UK Brexit vote has had “no impact” on bookings but recent terrorist attacks have “changed the industry”, according to Thomas Cook UK managing director Chris Mottershead.

Addressing the Travel Convention in Abu Dhabi on Wednesday, Mottershead insisted: “Brexit has not had an impact on bookings at all. Bookings are strong for future seasons. We see greater demand for what we offer.”

He downplayed the impact of the fall in the value of sterling since the vote, saying: “The impact of the exchange rate will be [felt] more down the road.

“But we’ve been here before with the euro – the weakness of the euro against the pound [in summer 2015] was more unusual. We can deal with it.”

Mottershead added: “The dollar [price of fuel] is being offset by cheaper aviation fuel and the efficiency of new aircraft.”

He argued: “The customer has a budget and that determines what people buy. Customers may take a shorter flight or change destination or choose 4-star instead of 5-star accommodation. There is huge variation [available] from self-catering to ultra all-inclusive.”

However, Mottershead said: “The wave of terrorist attacks in the last 16-17 months and the attempted coup in Turkey have changed the industry.

“Companies don’t know when it will end and we have to find the best way to run our business.

“Thomas Cook has had to react continuously. The planning we did initially for summer 2016 we had to change several times, to move capacity from Sharm el-Sheikh, from Tunisia and from Turkey to an extent.

“We introduced new destinations such as Sicily and Croatia, and we’ve gone back to some old favourites such as Malaga. We had to change some of our hotels and grow our all-inclusive.”

He suggested the tour operator model had proved more adaptable than that of online travel agents (OTAs), saying: “The OTAs really struggled in the lates market offering commoditised product.”

Mottershead told the convention: “Thomas Cook and all our competitors faced our aircraft towards Spain.

“That created overcapacity in seats but with insufficient accommodation. Demand was there but prices weren’t low, so demand in the lates moved back to Turkey because the prices were fantastic.”

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