Hundreds of thousands of vacationers were left stranded when one of the world’s oldest tour companies, Thomas Cook, abruptly announced on Monday, with some of its flights still in the air, that it was going out of business. Founded in 1841, it changed the face of British travel.
Thomas Cook was no ordinary travel company. Though the company’s brick-and-mortar business model was overtaken by time, some also saw in it's travails early signs of Brexit damage to come. They said a weakened pound and uncertainty among travellers had played a role in the collapse. If Thomas Cook’s customers were surprised, British officials had less reason to be. The government had refused to mount a financial rescue of the battered company; doing so, Mr. Johnson said that it would create a “moral hazard” by encouraging other troubled companies to take undue risks.
The 178-year-old travel company had been in poor financial health for some time. It announced its closing after negotiations to obtain £200 million pounds, or $250 million, in emergency financing fell apart over the weekend. Analysts said Thomas Cook, struggling with a debt pile approaching 2 billion pounds — nearly $2.5 billion — had failed to adjust to the changing times but the company also suffered from a number of factors beyond its control, particularly Brexit, the planned British withdrawal from the European Union, which has cut the value of the pound. That has discouraged travel and squeezed profits.