Package Tours Are No Picnic. That’s Not Stopping Germany’s TUI

For decades, tour operators such as TUI, Kuoni, and Thomas Cook thrived by offering package holidays to sun-starved Europeans put off by unfamiliar tongues, foreign currencies, and hotel reservations made from afar. But these days the euro has eased money concerns, discount airlines will fly northerners to warmer climes for as little as the cost of lunch, and beachfront accommodations are just a few mouse clicks away—no language skills needed. At the same time, terrorism, political turmoil, and hotter summers in the north have kept many would-be travelers at home.

The shift has squeezed profits at tour operators and forced long-standing players from the field. French stalwart Club Med went on the block in 2015 and ended up in the hands of Fosun Tourism Group from China. Switzerland’s Kuoni in 2015 sold its tour operations to a German supermarket chain after offloading its business travel and airline units. Thomas Cook—which invented the package holiday in the 1840s with train trips through the English Midlands for temperance activists—said in July it would sell its consumer tourism business to Fosun after its bonds fell to one-third of face value.