London’s oldest travel firm, Thomas Cook collapsed on Monday, leaving thousands of tourists stranded aboard.
Thomas Cook started in 1841 and made its mark in all aspects of travel. The firm ran hotels, resorts, and airlines. The fall occurred after the firm failed to secure a government bailout. A $2.1 billion debt was accumulated due to faulty deals. The company had no choice but to shut down operations.
The fall was inevitable, and Britain’s Prime Minister Boris Johnson refused to have the government assist with salvaging the airline prior to the collapse. The avoidance of intervention was to deter a “moral hazard.” A government bail out could possibly set the precedent for other businesses.
The government provided assistance to stranded travelers by providing charter jets to get them back to Britain. The government also covered the accommodations for travelers who booked hotel reservations through Thomas Cook.
The fall of the firm extends far beyond Britain and the effects will be felt internationally.