Travel firms need to worry about more than just upsetting the Daily Mail

There has been so much debate about ATOLs over the last year or so, you’d be forgiven for switching off the minute you hear the word.

But don’t. There is little more important than what this one little word represents for an industry trying to survive today’s turmoil.

This week TUI Travel’s UK boss Dermot Blastland, writing exclusively for sister title Travel Weekly, didn’t mince his words.

If the industry doesn’t educate consumers about financial protection there could be an awful lot more ranting British tourists than there were during the XL Leisure Group debacle last September.

Blastland – who without doubt has a better vantage point on the state of the industry than the rest of us – fears a million Brits could be affected by a travel company collapse this year and 100,000 stranded.

Ouch. If you thought XL’s collapse was bad, think again.

It begs the question how many travel companies, particularly in the dynamic packaging sector, and airlines, now make it policy to tell clients about financial protection – whether it’s to advise them to take scheduled airline failure insurance or assure them they are covered by the company’s own ATOL or trust fund?

The dearth of advertising campaigns on the issue – a first for an industry previously too scared to raise the sore point – should make it easier to broach the subject if the consumer hasn’t already.

More importantly, Blastland warns of more tour operators de-packaging products and more holidaymakers travelling without proper protection if ATOL costs go up. This follows speculation of rises in ATOL protection contributions from £1 to nearer £5 this year.

My guess is consumers that book through the trade are savvier than the industry gives them credit for and even when financially stretched they will now consider a few extra pennies to ensure they are covered.

There’s nothing like stories of crying families “stranded” on holiday on the front pages of the Daily Mail to hammer home a point and regularly hearing tea-time TV and radio advertisements focusing on the issue.

Most reputable tour operators and travel agents are also now choosing to toe the line. Even Travel Republic – one of them most praised (for its rapid growth) and chastised (for the way it sells holidays) online travel agencies of recent years – has decided to offer financially protected holidays.

But Blastland is right to point out the severity of the situation because there is a huge chunk of the market – many of whom will not go near a travel agency and will book completely independently – that will travel without the proper protection this year.

This will be partly because of a lack of cover across sectors such as aviation, partly because of consumers own, often misplaced, confidence, and partly because some companies would rather sell cheap holidays or are more focused on their own survival than the need to foot a bill to ensure they sell protected holidays.

But the fact remains that the only party that can make a real difference doesn’t seem to have taken any notice – the government. Let’s face it: the industry did such a good job cleaning up the XL mess it could probably dig itself out again and ministers are too deep in the pockets of the airlines to see the other view point.

With other industries now in far more trouble than travel, ministers are unlikely to pay more than lip-service to the industry’s woes.

As companies, you can either get on your high-horse about it or you can make damn sure every one of your customers is in the know. It’s your choice.

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