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2,600 job cuts at Thomson Holidays

15/12/2006

Thomson Holidays employees are facing widespread layoffs after the firm's German owner, TUI AG, announced 2,600 job cuts in the UK today.

Britain is the worst-hit European country following the decision by TUI, which specialises in the shipping and tourism sectors, to embark upon a €250 million (£167 million) cost-saving initiative.

In total the firm plans on cutting 2,600 jobs across Europe by 2008.

"Against the background of a constantly changing market and persistently strong competitive pressure, TUI has been forced to further reduce costs in the tourism division," the Hanover-based firm said in a statement.

"Without further growth and an adjustment of our cost structures, we would risk our market position," TUI's chief executive, Michael Frenzel, added.

The German company's decision to reject calls for a demerger of its operations and its entry into the cruise market reflect the largely upbeat nature of its statement, despite its strategic shift away from the difficult tourism market upon which Thomson Holidays' business is based.

"We are very disturbed that the UK seems to be bearing the brunt of these job cuts, when budget airlines have hit package holidays across Europe," Gerry Doherty, general secretary of the Transport Salaried Staffs Association, told the ITN news agency:

"We hope it is not the fact that the UK's weaker labour laws make it easier to get rid of workers than it is on the continent," he added.

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