TUI plans to boost profitability and raise competitiveness with an additional cost-cutting programme targeting…
TUI plans to boost profitability and raise competitiveness with an additional cost-cutting programme targeting savings of around Euro 150 million in 2003.
Together with the measures introduced early in the year to save Euro 111 million, the cost saving measures in the TUI Group now amount to around Euro 260 million compared with 2002 financial year. An additional Euro 100 million in savings are planned during 2004 financial year.
Dr. Michael Frenzel, TUI AG executive board chairman said: These measures will further boost the profitability and lift the competitiveness of the TUI Group. We are also paving the way for TUI`s profitable growth in the future.
Approximately two thirds of these additional cost-cutting programmes are in operating costs. These include lowering telecommunications and IT costs, reducing rental costs, cutting sponsoring expenditure, and lowering costs by reorganising working processes throughout the Group.
Personnel costs are to be primarily saved by fully exploiting existing flexible instruments, such as part-time early retirement, unpaid leave, non-renewal of short-term contracts, and non-refilling of vacancies in order to avoid business-related dismissals as far as possible.
The package of measures for 2004 includes savings of around Euro 30 million to be effected by optimising functions in TUI Headquarters in Hanover and by streamlining the Group`s organisational structures. In this connection it is planned to cutback staff at TUI Headquarters by some 25 per cent, i.e. around 100.
This cutback in staff at TUI Headquarters is a resolute and unavoidable step, with which we are sending a signal to our operative units, said Dr. Frenzel.
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