Lowcostholidays in administration

[clinkham]

Reported by The Guardian this evening, here

https://www.theguardian.com/business/2016/jul/15/lowcostholidays-administration-warning-travellers

"In 2013, the Civil Aviation Authority had warned holidaymakers to avoid booking with Lowcostholidays after the company relocated to Spain, which meant that its holidays were no longer protected under the Atol scheme run by the CAA. This ensures that customers can return home and get their money back if a company goes bust. Lowcostholidays had dismissed these warnings, stating that holidaymakers had protection under a Spanish scheme."

"On its website, the company advises customers to claim for any extra payments that they are asked to make to their travel insurer, credit card company or the government of the Balearic Islands, which licensed Lowcostholidays."

The administrators "said a number of factors had contributed to the group’s demise, including the EU referendum, which led some customers to delay holiday decisions. “The group experienced significant market headwinds in the run-up to the EU referendum as holidaymakers delayed decisions,” he said. “This was compounded by the leave vote itself and the subsequent fall in value of the pound."

 

[Tommo]

Suppose the old adage of buyer beware Clinkham. Feel sorry for the people involved though.
We are very lucky on our holidays in PP , we actually deal directly with the owner and so far that has proved to be fine.

 

[Mark]

Such a shame

According to the articles online there are 110,000 people with bookings due to travel.

The peak school holiday season is starting right now which means many of these 110,000 people will have paid the full and final balance about two to three months ago.

So low cost holidays will have received tens of million pounds of holiday makers final balance money in the last few months and they go bust just before they have to pay the hotels and flight companies with the money the holiday makers trusted them with.

Tough times ahead I think until euro financial trouble settles and maybe more big collapses as most people are ultra cautious with spending at the moment.

Look how many sales there are in shops and online and also generous offers for Summer 2017 package holidays.

We also always do the DIY holiday, book direct with owner when we can or a small villa rentals company, flights ourselves on Easyjet or Monarch and pay with credit card and hope that if we have to claim on the credit card in the event of a collapse the bank is still in business

 

[Molt de Renou]

The real reason is because they were underfunded and using next years deposits to pay this years costs.

 

[Catwoman]

Exactly this happened to us a few years ago when Open Holidays went bust- the day before we travelled to PP. The air fares were paid but we had to pay accomodation again before we could fly. Fortunately we were able to -using credit cards- but thats not possible for many. It took MONTHS to get our money back. Now we book directly- flights and hotels.

 

[Sparky]

A report from the MDB :-

Government now says that hotels cannot charge Low Cost customers.

The chaos caused by the collapse of the Low Cost Travel Group continues, with explanations from the Balearic government adding to the confusion. While it has been said that holidaymakers will face the possibility of having to pay hoteliers if the hoteliers hadn't been paid by Low Cost, the director-general for consumer affairs, Francesc Dalmau, has contradicted this. He says that hotels cannot charge tourists a second time and that they (the hotels) have to pursue claims against the collapsed company.

Dalmau cited Balearic and national law on consumer protection in asserting that the hotels cannot claim from guests. He added that tourists can also count on the European Consumer Centres network "to which all claims go" but has not said anything about payments that have been demanded by hotels and indeed paid. That he made his announcement a week after Low Cost went bust is something to be added to the list of questions to be asked about the government's handling of the affair...................

The full story can be read here :- Government now says that hotels cannot charge Low Cost customers » Balearics » News » Majorca Daily Bulletin