By Karen Peattie

EUROPE’S biggest holiday company, Tui Group, revealed losses of €1.1 billion (£995 million) during the third quarter as the coronavirus pandemic halted holidays and cruises but insisted demand was “very high”, reporting 1.7 million new bookings across the business since travel activities resumed.

The Anglo-German group, which has secured an additional €1.2bn German government aid package, saw revenues slump by 98 per cent to €75 million (£68m) compared to £4.2bn in the same period last, reflecting its standstill for most of April, May and June with partial operations resumed from mid-May.

Bookings for summer 2020 are down 81% while capacity for winter 2020/21 has been reduced by 40%. Summer 2021 capacity has been “cautiously adjusted by 20%, with flexibility to adjust as we gain more visibility”.

Last month, the travel giant cancelled all summer flights out of Aberdeen, Edinburgh and Inverness airports after the Scottish Government did not include Spain, Scotland’s most popular overseas holiday destination, on its list of countries which did not require travellers to quarantine for 14 days on their return.

There was good news for Glasgow Airport, however, when the firm said it would restart flights to several sunshine hotspots this month, including Antalya, Corfu, Dalaman, Ibiza, Gran Canaria, Lanzarote, Palma, Tenerife and Zakynthos.

It said that Paphos and Tunisia would also be added to the programme throughout August.

Tui flights from Aberdeen to Tenerife are expected to resume from October along with some services from Edinburgh but Tui will not fly from Inverness again until next year.

Tui chief executive Fritz Joussen said: “Our integrated business model with aircraft, transfers, hotels and cruise ships is intact and has proved its worth in this difficult environment. During the crisis it has enabled us to be the first travel company to fly guests on holiday.”

Mr Joussen added that the company had introduced “massive cost reductions early and implemented them quickly and consistently”. The additional loan from the German government, he said, “will secure our liquidity in the event of further long-lasting travel restrictions and disruptions through Covid-19”.

“The securing of financial resources will allow us to focus on our operating business and at the same time drive forward the realignment of the group,” he said. “Even before the pandemic we had already initiated the next transformation of Tui – the transformation into a digital platform company. This is now being significantly accelerated.”

However, Mr Joussen confirmed that a comprehensive review of the company’s activities across the business worldwide to identify benefits and savings has been triggered.

“Tui after the crisis will be stronger, faster and more efficient than TUI before the crisis,” he stated. “Tui is very experienced in managing crises – we will also master them successfully, and Tui will emerge from them stronger and in the long term economically as successful as before the pandemic.”

The company also said it had agreed compensation with aircraft maker Boeing over the prolonged grounding of 737 Max planes, and will receive staggered compensation over the next two years, credits against future orders, and a deferral of 61 aircraft deliveries.

In May, Tui warned that it needed to cut 8,000 jobs and reduce overhead costs by 30%. Last month, it revealed plans to shut 166 high street stores in the UK and Ireland, affecting up to 900 jobs. The tour operator said it hoped to retain 630 people across a mix of sales and home-working roles, and in remaining stores.

It said it was responding to changes in customer behaviour, including a shift to customers booking online.