Thomas Cook Sets up New Airline in Spain amid Cost Drive

Thomas Cook is setting up a new airline in Spain, a move it hopes will lower costs at a time of tough conditions in the European short-haul market.

The new airline will be based in Palma de Majorca and plans to start its first flights in early 2018 with at least three Airbus A320 planes, which were previously flying for the group's Belgian airline.
The Majorca aircraft, which fly under a Spanish operating licence, will also be used for Thomas Cook's other airlines, according to seasonal demand, while some staff will be on seasonal contracts.


"The new airline and base will provide us with the right platform to better manage the seasonal demand in our business, giving us more control at lower cost as we continue to expand the choice of destinations we offer our customers," Christoph Debus, chief airline officer at Thomas Cook, said in a statement.

Holiday companies and airlines like Thomas Cook have the problem of how to use aircraft and crews efficiently during the off-peak season in winter, and typically make a loss during that period.

Thomas Cook announced earlier this month it would exchange several aircraft with Canada's Transat AT Inc. Under the deal, Thomas Cook will provide planes that fly short-haul routes in the summer to the Canadian company during the winter, while it will receive a long-haul plane to take Europeans seeking winter sun to further flung destinations.

EasyJet also has a seasonal base in Palma, with aircraft stationed there between March and October and crew working eight months of the year with four months off.
Rival tourism group TUI is also trying to find ways to bring costs down at its German TUIfly.

Thomas Cook Airlines have a combined 94 aircraft, flying 16.7 million passengers a year to holiday destinations, and have revenues of 2.8 billion euros (US$3.3 billion). (US$1 = EUR0.8508)
Victoria Bryan, Reuters