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Friday, 26 October, 2001, 16:50 GMT 17:50 UK
Thomas Cook cuts 2,600 jobs
Beach in Mauritius
Fewer people are escaping to the sun
Travel giant Thomas Cook is axing 2,600 jobs across Europe.

The company said it was grounding some charter flights and closing 100 travel agencies, after reporting a 12% fall in bookings.

It has not said how many of the jobs will go in the UK.

Voluntary redundancy schemes and cuts in working hours have already been announced in the aftermath of the 11 September terrorist attacks in the United States.

Thomas Cook operates 700 high street travel shops in the UK as well as the Thomas Cook and JMC tour operators.

The company employs about 30,000 people across Europe.

Its operations, distribution and internet business is based in Peterborough, Cambridgeshire, employing 1,600 people.

Kevin Booth, editor of the Peterborough Evening Telegraph, told BBC News Online: "Anything up to 200 jobs could be lost here in Peterborough. Thomas Cook is one of the city's major employers."

'Unfortunate'

Thomas Cook said in a statement from Germany that the number of jobs across the group would be cut by 10%.

Planned capital expenditure is to be reduced by 50%.

Alan Stewart, chief executive of Thomas Cook UK said: "It's very unfortunate that we are having to look at cost reduction measures across the group, but very necessary given the current trading conditions."

Thomas Cook is jointly owned by German airline Lufthansa and department store group KarstadtQuelle.

The company, which is Europe's second largest travel company, said it wants to keep annual profits at last year's level of 160 million euros (100m).

'Buoyant'

Mr Stewart said more people were travelling overseas than last year at the moment and the UK package holiday market was "buoyant".

But customers were not booking holidays for this winter and next summer.

Thomas Cook chairman Stefan Pichler said new bookings across the group for the winter season were down by 12% on last year.

"At present we have no indication that this situation will change in the short term and our responsibility to our company and our employees leads us to implement certain measures to safeguard our financial position and secure our continued success," he said.

 WATCH/LISTEN
 ON THIS STORY
The BBC's Russel Hayes
"They're taking this action to make sure next year they're not making substantial losses"
The BBC's Jenny Scott
"There are signs the economy is slowing"
Alexis Coles, Thomas Cook UK spokeswoman
explains how the cuts will affect employees in the UK
See also:

02 Oct 01 | Business
Nervous tourists cancel trips
27 Sep 01 | England
Jobs go at Thomas Cook
07 Dec 00 | Business
German firm buys Thomas Cook
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