XL Leisure Group enters into administration

The third largest tour operator in the UK has gone into administration.  As of September 12, 2009 all flights by XL Leisure Group are grounded. XL currently employs around 1,700 people at locations around the world.  It is estimated that nearly 90,000 customers of XL will be left stranded abroad.  The announcement by XL follows on the tails of holiday package provider Seguro who also just entered into administration.

A statement from XL said that “The Companies entered into Administration having suffered as a result of volatile fuel prices, the economic downturn, and were unable to obtain further funding.  The Joint Administrators cannot continue trading the business and therefore all flights operated by the Companies have been immediately cancelled and the aircraft grounded. Going forward, the Joint Administrators are unlikely to be able to trade the business or operate the aircraft.  All passengers who have yet to commence their travel should make alternative arrangements” which are listed on the company’s website.

The chief executive officer of XL, Philip Wyatt, said that “It’s difficult to absorb an $80 million increase on fuel.  Prices moved so rapidly.”  Wyatt also noted that “The CAA will have a huge challenge on their hands” helping stranded customers. “It’s going to be the most challenging airlift anyone has undertaken.”

Rivals of XL are Thomas Cook and Virgin Airlines and they are already helping any of XL’s stranded customers find flights home.  Very recently the airlines also helped out when budget airline Zoom went into administration as well.

www.xl.com