More bad news for the travel industry: package holiday group Flight Options, more commonly known as Kiss Travel, ceased trading last night after finally running out of cash – much to the undoubted horror of the 13,000 customers that are currently on their hols courtesy of the firm (although they’ll all be covered for their return flights). The company said it had had a tough few months after the ash cloud saga, while the imminent austerity measures seem to be affecting the number of people booking holidays (‘I blame that George Osborne’, in other words). It’s not the first travel company to go out of business this summer – and with the October spending review set to tighten household belts even further, things are unlikely to improve any time soon…
This Kiss of death is expected to affect about 70,000 travellers, some of whom were due to travel to locations such as the Canary Islands, Greece and Egypt, and some of whom were already there. Thankfully, unlike with some of the recent holiday company collapses, the Civil Aviation Authority seems to be going to great lengths to ensure no one will get stuck abroad (and thus spend any longer than absolutely necessary in Magaluf), beavering away to arrange flights home for stranded holidaymakers. It also looks as though people whose outward flights are booked before 6pm today will be able to carry on as planned – while the majority of other future travellers are at least guaranteed refunds through the the Air Travel Organisers’ Assurance protection scheme. So while it’s undoubtedly an inconvenience for frustrated holidaymakers (particularly those who rebooked their flights with Kiss after the Goldtrail collapse), they shouldn’t be left out of pocket.
Kiss is the third travel company to collapse in a month – unprecedented for this time of year. But its demise comes as a slight surprise: its finances looked fairly healthy when it released its end-of-year results back in October, with operating profits of £500,000. Sadly, since then the travel industry has had to deal with an unfortunate combination of falling volcano ash and falling consumer confidence. It’s the latter that’s being blamed for Kiss’ cash flow issues: apparently, people just weren’t booking holidays for September and October.
The company’s unfortunately-named chief executive, Gary Ash, expressed his ‘devastation’ over the collapse. But Kiss is not the first small player in the British travel industry to suffer this fate, and the harsh reality is that it’s unlikely to be the last. With the forthcoming cuts likely to reduce consumer confidence and squeeze budgets even further, the chances are that bookings for the rest of this year will only be going in one direction – down.
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