TUI considers move to third-party flights

TUI UK will replace regional flights with third-party flying if airports don’t back down to its demand for lower passenger fees.

The company has warned UK airports it wants fees to be slashed to match those offered to no-frills competitors or it will consider pulling its own in-house flying.

TUI UK is angry that airports are offering special rates to competing no-frills airlines when it pays around £10 more per passenger in fees.

Retail sales director Miles Morgan confirmed the company was serious about its threat to pull out of airports.

"Ultimately, we have to make a profit out of every part of the organisation. Every business has to drive down its costs. If we can compete with the no-frills carriers that would allow us to look at more new routes,” he said.

"If necessary the shops will sell third-party flights out of regional airports to satisfy demand.”

TUI northern Europe’s airport advisor, Bill Savage, said the company had taken more of an interest in its airport charges since taking over Coventry Airport in February.

"Owning Coventry has shown them how the business really operates,” he said. "The company has been able to see how things work on the other side of the fence and is no longer prepared to accept the norm. We’ll support airports that support our business.”

Rival operators backed its stance. First Choice Holidays managing director Neil Morris said: "While we never discuss details of contracts with airports, it is important we secure good rates and competitive deals.” He ruled out launching a joint trade assault on airports because rival charter airlines have stronger bases at different airports.

Airports were cagey about TUI’s threats, stating contracts with airlines were private. However, BAA said it didn’t offer discounts at Gatwick and Heathrow and was phasing out discounts at Stansted and its Scottish airports.