TUI AG, the world’s biggest holiday company, plans to renew its jetliner fleet as rising oil prices begin to push weaker rivals to the wall.
TUI is likely to turn options for close to 50 Boeing Co. 737 Max aircraft into firm purchases, giving it a total of 120 orders for the upgraded model, and is switching to more of the largest variant to boost capacity, David Burling, who heads TUI’s airline operations, said in an interview. It’s also evaluating a new mid-range Boeing jet as a replacement for its larger 757 and 767 planes.
The collapse of Air Berlin Plc and Monarch Airlines in 2017 provided a boost for TUI, with the exit of German charter carrier Azur Air GmbH last month and Scandinavia-focused Primera Air on Oct. 1 suggesting higher fuel costs may be about to claim more victims.
Not only would a spate of failures boost fares by removing capacity, it could encourage more people to take package holidays since they come with a greater degree of consumer protection, Burling said.