Holidaymakers asked to pay twice for hotels following collapse of German travel firm

This week, a big German travel combine, FTI Touristik, collapsed. It was the third-largest tour operator in Europe.

The company is telling passengers: “All travel arrangements booked via FTI Touristik GmbH with a departure date up to and including Friday, 5 July 2024, unfortunately have to be cancelled.”

The number of UK holidaymakers directly affected – ie having packages booked with the defunct German travel giant – is vanishingly low. Furthermore, they are covered by the German Travel Security Fund.

But two subsidiaries of the FTI group are “business-to-business” middlemen that provide hotels, transfers and excursions to online travel agents (OTAs).

They are Youtravel.com and Meeting Point International. Both offshoots are in financial suspended animation while the FTI insolvency is sorted out.

For now, though, British travellers who had no idea part of their holiday was booked through a German firm are told: “Have you booked other touristic services as individual services with FTI, such as excursions, airport transfers, etc.?

“Unfortunately, individual services do not fall under the statutory insurance protection for package tours and are therefore not covered by the German Travel Security Fund.”

These are the key questions and answers.

I booked a Mediterranean holiday with a UK online travel agent. How come my trip could be in peril?

It all comes down to the way that online travel agents construct package holidays. Traditional tour operators – of which Jet2 Holidays and Tui are the largest – generally have direct relationships with Mediterranean hotels, bus companies and excursion providers.

In contrast, OTAs such as Love Holidays and On The Beach often source these elements through intermediaries that, in the realm of accommodation, are known as “bed banks”. One of the biggest bed banks is Youtravel.com, which calls itself “the trade’s favourite supplier”. The UK-based offshoot of FTI had immense buying power and was therefore able to offer hotel rooms at very favourable rates.

Millions of Brits have probably enjoyed holidays that have involved Youtravel.com and been blissfully unaware that a German-owned middleman was involved. But suddenly, the fate of the company is uncertain.

FTI says Youtravel.com is not insolvent and is “working actively” on its future. It aims to “secure our future without the…