TUI/First Choice merger to have ‘far-reaching impact’
The repercussions of the proposed merger between TUI AG and First Choice could have far-reaching effects, warned John Kent, founder of accommodation-only provider Youtravel.com.
He said: “While of course everyone’s first thoughts are with the staff of each company who could potentially be out of work, it’s important to not forget the overseas operations which will be affected too.
“There will be consolidation in all areas of the combined business meaning that overseas reps and management teams will be impacted.
“Moving to one sole overseas brand will mean that in the many resort areas which will see duplication of functions as two teams will move into one, it can only mean job losses. Swathes of overseas positions from reps to team leaders to senior resort management will face the axe along with UK-based colleagues.
“Handling agents which rely on one of these two giants are going to have a very tough future. TUI has its own in-resort infrastructure whereas First Choice used local handling agents. For these agents the contracts with a huge company such as First Choice would have been their lifeline and it’s very likely that they will go out of business as a result of the merger as the combined group consolidates its overseas operations.
“I believe that for these types of business the merger could have catastrophic effects. When it comes to hotel negotiations too, hoteliers could now be faced with working with two rather than four companies meaning that it’s likely that room rates may be driven right down as the two new ‘super travel groups’ fight for supremacy.”
by Phil Davies
Phil Davies
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