Thomas Cook collapse could ‘kill the market’ says Cyprus hotelier

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Calculating the cost of Thomas Cook's collapse to Cyprus

Speaking on Wednesday (25 September), two days after the world’s oldest tour operator collapsed, Doros Takkas, who is also general manager of four hotels, said the estimate covered only the current unpaid bills and didn’t take into account the 45 days left of the season that the industry would also now lose out on.

“We were aware that Thomas Cook was in a not-so-healthy situation… but this still came as a shock for a lot of people,” Takkas said. “We estimate the damage to Cyprus hoteliers to be about €50-60 million, and around €25-30 million of that will just be from British customers.”

It’s a shock with ripples that will be felt across Cyprus. Takkas estimates Thomas Cook Group brought in around 250,000 customers from across Europe annually – some 7-8% of the total visitor numbers to the country. And while Takkas said it was positive that Cook’s Swedish division, Ving, would at least continue to operate, he admitted the loss of British Cook customers would be hugely damaging to Cyprus and its economy.

“Am I worried? Yes,” he said. “We have a lot of concerns about the UK anyway because of Brexit – now to have a major tour operator go down like this, people are worried; they’re nervous.

“The hotels are actually working on overdrafts to cover this. And then there’s the impact on suppliers; it’s a domino effect.”

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'We've no idea what's going on' say frustrated Thomas Cook customers

In the immediate term, Takkas said hoteliers had been left stunned by the lack of Thomas Cook reps, revealing they had “just disappeared” following news of the company’s collapse.

As for the group’s customers, Takkas said the hotel association had taken an active decision to look after them as much as possible, and insisted Cyprus would not be following the route of certain hoteliers in other destinations that have reportedly locked guests in, forcing them to pay again for their stay.

“We’ve said to the tourists don’t worry, we’ll sort it. These are customers that have been with us before – they will receive everything they need.”

Takkas said he had not yet heard anything from the CAA or UK government, but that he was planning to make a claim against the Air Travel Trust Fund to cover the cost of customers’ bills for their stays in the days following the collapse of Cook. However, he acknowledged “it could be several months” before hotels received their money.

And then there are the worries about the long-term impact of Cook’s demise. Takkas said one big concern was how Cook’s collapse could affect future bookings from the British market. “[British] people will now be worried about losing their money, so they may prefer to book last minute instead and this will cause cash flow problems,” he warned. “This could kill the market.”

'We are not happy at losing a tour operator like this'

There are also the hotels in Cyprus that were totally reliant on Cook. “There are worries that some businesses may not survive that, because there are some that were totally dependent on Cook,” Takkas said.

For them – and many other hoteliers – the challenge now will be to find tour operators to fill the void left by Cook, although this of course will make the market less competitive and may leave hotels at the mercy of the remaining “big boys” who may choose to bring rates down.

“We are not happy at losing a tour operator like this. Thomas Cook was a key player. We want a plethora of tour operators in the market because that creates a healthy market,” Takkas pointed out.

He revealed he had already had conversations with Tui and Jet2 about filling the gap left by Cook, but said “they hadn’t said yes or no”. “They are analysing the market,” he added.

And yet, Takkas said there were also opportunities. He has already signed contracts with easyJet Holidays for next year, admitting the void left by Cook could at least be a “great opportunity for easyJet Holidays to grow”.