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All flights cancelled

Thousands of Brits left stranded as airline goes bust

12-September-2008, By Becca Talbot becca.talbot@consumerchoices.co.uk

Tens of thousands of British holidaymakers have been stranded by the collapse of tour operator XL Leisure, after it announced early this morning that the administrators had been called in following failed talks with financial backers.

The XL Leisure Group, based in Crawley, West Sussex, was forced to call in administrators this morning after the failure of last minute talks with its financial backers - Icelandic investment group Straumur and Barclays (www.barclays.co.uk).

With all of the company’s planes grounded, an estimated 85,000 people have been left stranded abroad, while a further 200,000 who have bookings with the company will lose out.

A spokesman for ATOL described the group’s collapse as “a huge failure” and pleaded with holidaymakers to be patient.

XL Lesiure, which employs 1,700 people worldwide, flies to more than 50 destinations across Europe and Africa, and sells through tour operator brands including The Really Great Holiday Company and Aspire Holidays.

Customers who have booked inclusive holidays with XL, or a charter flight through one of XL’s brands (The Really Great Holiday Company, Kosmar Villa Holidays, Freedom Flights or Aspire Holidays) will be covered by ATOL’s financial protection scheme.

ATOL is a financial protection scheme for UK tour operators, protecting more than 28 million consumers each year from holiday disasters.

The Civil Aviation Authority (CAA) is working with other airlines and tour operators to organise repatriation flights for all the package holiday travellers currently stranded abroad. However, anyone who has booked a flight directly with XL Airways (flight numbers beginning with XLA) will have to either buy a ticket on to one of the CAA’s specially organised flights, or arrange their own travel plans home.

Package holidaymakers who have booked with XL’s Medlife business are also not covered by ATOL, and anyone already abroad will not automatically be brought home.

Other airlines are already reporting a massive increase in demand for flights as XL customers try desperately to make alternative arrangements. The cost of a flight from Glasgow to Tenerife, for instance, has more than doubled to between £500 and £800. Prices for flights back to the UK this evening have risen as high as £1,800.

Meanwhile, websites for both ATOL and the CAA crashed this morning, due to the sheer weight of traffic, caused by worried XL customers. And helplines set-up by the CAA are permanently engaged. Anyone who has booked flights or a Medlife holiday with a credit card or Visa debit card will be able to reclaim their money from their card issuer.

Some passengers may also be covered by their travel insurance.

The company is the 26th travel firm to go bust in less than a year, forced under by the twin pressures of rising fuel costs and tough financial markets.

Earlier this week Seguro Travel, which offered package deals to Gran Canaria and Costa Brava from Glasgow Prestwick airport, ceased trading after the Spanish airline which operated 80% of its flights - Futura - launched insolvency proceedings in Palma on Monday. Budget airline Zoom also hit the headlines with its collapse last month.

The spokesman for ATOL said: “With XL Airways no longer operating we are having to bring in substitute aircraft to bring people home. We ask people to be patient while we organise that. Our priority is the stranded passengers abroad and getting them back to the UK.

“Clearly if people do incur some additional costs, if they are delayed in their return, then they can put a claim in to the CAA under the ATOL scheme.”

Chris Eagle, commercial manager at CreditChoices.co.uk said: “This is a worrying time for holidaymakers, with 26 holiday companies going bust this year already, it is good practice to book your holiday and flights with a credit card for added protection, then you should be able to reclaim the costs back from your card provider if the company goes into administration.”

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