Europe‘s third-largest tour operator FTI Group filed for insolvency in the Munich regional court on Monday, the German company said in a statement, as bookings continued to fall even after a recent one-euro buyout proposal.
In addition to sinking orders, multiple suppliers insisted on advance payments, which FTI is no longer able to provide.
The group has opened a hotline and a website for customers, the statement added.
It will have to either cancel or complete only partially all trips from June 4, potentially affecting thousands of holidaymakers at the beginning of the travel-busy summer season.
The German Foreign Ministry said that the tourism industry and travel insurance fund would take care of repatriating and supporting the tourists affected but that it would provide consular support if necessary to ensure a safe return.
The German Economy Ministry called the insolvency “tragic” adding that it could not provide any additional assistance.
Germany outpaces France in hotel bookings despite Paris being the most searched destination from India. Contrary to the search data, Germany has outpaced France in actual hotel bookings, receiving 19 per cent of all bookings from India, compared to France’s 16 per cent. The efficiency of its visa process, affordability, and strategic location within Europe make Germany a preferred choice for many.
The government needs to examine in detail what effect the insolvency will have on the recovery aid funding it had granted FTI during the pandemic, a finance ministry spokesperson said. “It must be assumed that only small recoveries can be expected from the outstanding claims,” the spokesperson said.
The government had been awaiting approval for a sale of receivables as the most economical way to claw back the funds before the company filed for insolvency, the spokesperson said.
The return of the receivables is no longer possible after insolvency, the spokesperson added.
FTI employs 11,000 people worldwide and offers tours to more than 40 destinations around the world, including through its 10,000 partner agencies in Germany.
In the 2022/2023 financial year, it reported annual sales of around 4.1 billion euros (USD 4.44 billion). (USD 1 = 0.9234 euros)
