Skift Take

Thomas Cook Group may have caved in, but in China and India, the companies that bear the name are profitable. Why?

The demise of UK-based Thomas Cook Group brings a wave of nostalgia to Asia and the reality that the traditional tour-operating model is incongruous in the internet age.

Another reality is that Chinese and now Indians are the new linchpins of Asia’s tourism growth, unlike before when the Western markets raring to explore “the exotic Far East” supported destinations.

It’s a sign of the times that the eponymous European name lives on in Asia through Thomas Cook India and Thomas Cook China. (At press time, the Nordics unit of Thomas Cook Group confirmed it will remain in business, but it’s still unclear if the continental European business will continue.)

Both Thomas Cook India and China aren’t running on the traditional tour-operating model. Both are also highly diversified. They have just scratched the potential of their huge markets. And neither have the legacy systems and structures that weighed down Thomas Cook UK.

Fosun Tourism Group, the majority owner of Thomas Cook China, is strengthening its Foliday (Fosun Holiday) concept and using technology to keep customers loyal to its growing ecosystem of travel businesses. Aside from Thomas Cook China, this includes Club Med, Atlantis Sanya, Cirque du Soleil, and Miniversity, an edutainment joint venture with Mattel.

Similarly, Thomas Cook India offers a broad spectrum of services including foreign exchange, corporate travel, meetings and incentives, leisure travel, insurance, visa and passport services, and e-businesses.

Asian millennials working in the travel industry may wonder why their elders are lamenting the death of a company that sits thousands of miles away.

What the older generation mourns is the end of an era. Many are likely reminiscing about their annual pilgrimage to Berlin where, in the halls of the trade show ITB Berlin, they huddled together with contract managers of the European tour operating companies to negotiate rates and room allotments. Among the biggest groups were Thomas Cook, TUI, Rewe, Kuoni, and Hotelplan. They were the Expedia and Booking of the day.

The new generation would find it all so strange. In the pre-internet era, tour operators produced thick brochures a year in advance for distribution to their network of retail stores, which then sold the tours to customers. Getting into those brochures was the way Asian hotels and inbound agencies reached the European market.

A deep symbiosis therefore existed between Asian sellers and European buyers. Many struck long-lasting relationships, as sellers and buyers conducted a lot of business face to face — and often over lavish dinners on the company expense account. It was hard work in the winter but also fun and memorable.

Then the party stopped.

— Raini Hamdi, Skift Asia Editor, [email protected], @RainiHamdi

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Asia Editor Raini Hamdi [[email protected]] curates the Skift Asia Weekly newsletter. Skift emails the newsletter every Wednesday.

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Tags: accor, climate change, expedia, fosun, marriott, oyo, skift asia weekly, sustainability, thomas cook

Photo credit: Chinese tourists take in the sights of the New York Stock Exchange and Federal Hall National Memorial. UK-based Thomas Group collapsed on Sunday, but the brand lives on in China and India. Mary Altaffer / The Associated Press