TUI has announced plans to increase its market share following the collapse of its rival Thomas Cook.
In a trading update this morning, TUI said it will become 'more cost competitive'.
The company, which will report its full year results in a few weeks, said it is currently assessing the short-term impact of Thomas Cook's insolvency on the final week of its 2019 financial year.
Some TUI customers had been booked on Thomas Cook flights, meaning the operator will have to find replacement services, which could negatively impact its earnings for the full year.
However, chief executive Friedrich Joussen said: "Our vertically integrated business model proves to be resilient, even in this challenging market environment.
"Our Holiday Experiences business continues to deliver strong results. Meanwhile, our Markets & Airlines business faces a number of ongoing external challenges such as the grounding of the 737 MAX aircraft, airline overcapacities and continued Brexit uncertainty.
"The Summer 2019 season is however closing out in line with expectations and we therefore reiterate FY19 underlying EBITA guidance stated in our ad hoc announcement of March 2019 of approximately up to minus 26% compared with underlying EBITA rebased in FY18 of €1,177m.
"These external challenges will continue in FY20 - therefore, we will focus on becoming more cost competitive in our Markets & Airlines business to protect and extend our market share where possible."
TUI's share price, along with those of other travel companies, has been boosted by Thomas Cook's collapse.
TUI's share price rose almost 10% initially, and remained almost 8% up in early trading. Ryanair was up 3.9%, while British Airways-owner IAG rose 1.2% and easyJet was up almost 5%.
OTA On the Beach has warned of a one-off hit today from the Thomas Cook collapse.
"The group expects to be able to recover the costs of the cancelled flights via chargeback claim (as was the case for the Monarch failure in 2017)," the firm said.
"This one-off exceptional will be booked in the current financial year.
"The Board is currently evaluating the potential effects of the failure on its forecasted performance for the year ending 30 September 2020, and a further update will be provided when appropriate."
Courtesy of Travelmole
For example, I was surprised at how little coverage Tui now have in Cuba. As far as I can see, they only fly to Varadero from Gatwick with a limited choice of hotel - we had been to Holguin 3 times with Tui in the past.
I do wonder whether one of the reasons why they have pulled out of the eastern resorts is because places like Varadero and the Western Cayos are much easier to sell overnight trips to Havana from and make money out of them. Either way, I think this means that fewer UK tourists will discover the delights of Santiago, especially since Cuba has now disappeared off most of the cruise itineraries again since Trump upped the ante in the Embargo once more. The American cruise lines have all dropped Cuba and even other non-US owned lines seem to no longer be able to fly people into Florida and sail from there. I see that for next year Fred Olson have started including Cuba amongst their Caribbean cruises but interestingly they will flying passengers into Barbados for embarkation
As for me, I'm still hoping to get to Cuba next March - I was booked on Thomas Cook flights but I'm covered by the ATOL licence of the small TO I book these holidays with. So whilst I won't be out of pocket financially I'm probably gping to be stuck with a far less convenient journey. As I'm retired, it doesn't make a great deal of difference having to possibly add an extra night in Havana on each end of the holiday nor does the added cost of that put such a holiday out of my reach but for people who are still working it will either mean having to take more than just 2 weeks off work or else lose out on possibly 2 days of the dance holiday. In the longer term I wonder for just how much longer this small TO will be able to keep their dance holidays to Santiago viable now that the travel arrangements will be so much more complicated for most UK travellers.
For the moment, I'm waiting to hear what the TO comes with because if there are a small group of us all travelling together that makes it more comforting if there are problems on route re connections etc.
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