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Travel Industry Crisis Leaves PR Agencies Out of Pocket

September 20, 2008

Matt Cartmell

‘Shell-shocked’ agency boss owed tens of thousands in fees after XL Leisure collapses.

Travel PR specialists are fearing the worst as the airline industry crisis escalates.

The recent collapse of Britain’s third-largest tour operator, XL Leisure, has already left at least two PRagencies owed thousands of pounds in fees.

Dublin-based McGovern PR is owed pounds 20,000 by XL, PRWeek can reveal. Agency MD Mary McGovern said: ‘I’mshell-shocked. My only saving grace is we weren’t lumbered with third-party costs.’

She added: ‘I think market conditions have changed dramatically and we are now entering a difficult time intravel PR.’

Meanwhile, Sussex-based KBC PR is owed a four-figure sum by the operator. Agency MD Kate Burgess-Craddy said:’If we’re lucky we’ll get a percentage.’

Freelance travel consultant Sue Lister is also believed to be owed fees by XL.

XL is the latest carrier to have failed this year. Others include Silverjet, Maxjet and Zoom. The latter’scollapse resulted in Media House International losing its account, but it is not know whether fees are owed.

More agencies could suffer after BA boss Willie Walsh this week said 30 airlines would go bust by the end of theyear.

Walsh told a business audience at the London Chamber of Commerce that the crisis facing the airline industry would be’deep and protracted’.

Bookmakers rank Air Berlin, SAS and bmi as next most likely to encounter difficulty. Air Berlin’s UK PR account is handled by Siren PR, which is also retained by Canvas Holidays, Travel2 and Advantage.

Siren MD Rachel O’Connor declined to comment directly on Air Berlin but did say: ‘I’m sure there are agreat many agencies that will be affected.’

However, O’Connor was publicly more optimistic than many rival agency chiefs have been in private.’I'm not going to say it’s all doom and gloom,’ she said. ‘It will sort the wheat from thechaff.’

AGENCIES EXPOSED

– Batphone Aviation Comms Portsmouth-based specialist consultancy. It has clients such as Swissport and BAA

– Aviareps German agency’s London office deals with Air Namibia and Caribbean Airlines

– Four Communications Airlines Etihad and bmi are on the books, as well as travel companies such as the Celtic Manor Resort

Siren PR Clients include Air Berlin and Canvas Holidays.

(c) 2008 PR Week. Provided by ProQuest LLC. All rights Reserved.




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