Thomas Cook Group plans to sell airline divisions

Photo: © Transport Pixels

British holiday company Thomas Cook has revealed plans to sell its airline divisions in Great Britain, Germany (under Condor brand), Scandinavia and Spain.

After a widened loss of over GBP60 million in the first Quarter of the 2018/2019 financial year, the Thomas Cook Group has now ordered an investigation over a potential sale of its airlines, which have consistently posted positive financial results.

The CEO of Thomas Cook’s airline business, Christoph Debus, says that the sale is a strategic decision made by the group in order to turn profitable again and to focus on hotels and digitization.

An indirect reason to sell the airline is the uncertainty around the Summer 2019 business as more and more people tend to book their holiday last minute, which makes it hard to plan ahead for the airlines. As a result, the carriers will reduce capacity slightly to ensure that they won’t be forced to operate mostly empty aircraft. Thomas Cook did not comment whether or not this sale is related to the UK’s plan to leave the European Union and therefore its single aviation market.

Debus also stressed that the sale is in a very early stage and it hasn’t been decided yet if the airlines will be sold as one entity or if they would be sold separately.

German newspaper Süddeutsche Zeitung has reported that Lufthansa is interested in taking over Condor’s long-haul business, which includes 16 Boeing 767-300ER aircraft and several routes from Frankfurt and Munich, Lufthansa’s main hubs. It is not clear if this potential takeover would comply with competition regulations in Germany.

Taking over Thomas Cook Airlines and all its sister companies would likely require a large investment, as many of the over 100 combined aircraft are at or near retirement age and will have to be replaced in the short to mid term.