Thousands stranded by XL collapse

The collapse of the UK’s third largest package holiday group has left tens of thousands of Britons stranded abroad.

The decision to place XL Leisure Group into administration has also left thousands of staff facing the axe.

Chairman Phil Wyatt said he was “totally devastated” by the failure which has grounded XL’s 21 planes. The company flies to about 50 destinations.

There are 67,000 stranded who booked directly with XL, and another 23,000 who booked via other companies.

The Civil Aviation Authority(CAA) also said the firm had 200,000 advance bookings.

‘Sad day’

CAA EMERGENCY HELPLINE Customers abroad: +44 (0) 2891 856547 Customers in the UK with advance bookings: 0870 5900927

“We’ve made every effort, myself and my fellow directors, to find new funding for the business – and it’s a very sad day for me personally. I am totally devastated,” XL chairman Phil Wyatt said.David Clover, a spokesman for the CAA, said it was making arrangements to help customers of the four tour companies within the XL group.

“In respect of people who are currently abroad we’re making arrangements and working very closely with the travel industry to organize repatriation flights.

“Clearly though, with XL Airways no longer operating, we’re having to bring in substitute aircraft to bring people home.”

He said package deals are covered by the CAA’s Air Travel Organizers’ Licensing (Atol) scheme and those customers will be offered repatriation flights or their money back if they have an advance booking.

Struggling

However, those who booked directly with the airline or XL.com – who are in the minority according to the CAA – will face a fee.

Anyone yet to take their flights should check their insurance policies, and with their banks or credit card companies about refunds, he added.

XL – which carried 2.3 million passengers last year – is the latest travel business to face financial difficulties, as the industry struggles with high fuel costs and an economic downturn.

But an agreement has been reached whereby Straumur investment bank has acquired XL’s German and French subsidiaries, which Straumur considers to be financially viable and sustainable businesses.

They will continue operations as separate commercial entities.

Share prices in holiday firms TUI Travel and Thomas Cook were up 6% and 7% following the collapse of their rival.

Economic downturn

“As the travel industry matures in Europe, there was always going to be pressure on those operating in the mid-market,” said Lastminute.com chief executive Ian McCaig.

A statement on the XL group’s website said: “The companies entered into administration having suffered as a result of volatile fuel prices, the economic downturn, and were unable to obtain further funding.”

XL COMPANIES XL Leisure Group XL Airways UK Excel Aviation Explorer House Aspire Holidays Freedom Flights Freedom Flights (Aviation) The Really Great Holiday Company Medlife Hotels Travel City Flights Kosmar Villa Holidays

BBC travel correspondent Tom Symonds added that the industry would be facing an “enormous challenge” as it deals with the fall out of XL’s collapse.

“XL wasn’t just an airline it was a fundamental link Britain’s package holiday industry,” he said.

“Getting these people to and from their holidays will be an enormous challenge not least because of the shortage of aircraft caused by so many airline collapses in recent weeks.

“XL can’t use its own airliners for among other reasons it has no insurance now.”

The CAA said it was working with the travel industry to bring stranded holidaymakers home, and denied it had been responsible for the grounding of XL’s planes.

Airlines BA, Easyjet, BMI, Flybe and Ryanair have offered to fly some of the stranded passengers home.

Easyjet chief executive Andy Harrison told that its fuel efficient planes had helped it cope with the high cost of aviation fuel although on Thursday it said it would cut up to 60 jobs to remain competitive.

Fuel pressures

Mr Wyatt added that spiralling oil prices had increased the firm’s costs “year-on-year by over $80m”.

“So where many people have been making hay with high oil prices, this is the repercussions of that hay – 1,700 people potentially out of work today in the UK,” he said.

Rival TUI warned that rising fuel costs meant that “airlines with less than robust business models” – such as XL and Futura – were now failing.

It added that the government should take steps to ensure all holiday companies must belong to the Atol scheme, which offers package holiday makers financial protection.

In the US, one flight from Orlando to Manchester managed to set off, while one bound for Gatwick was grounded. A source at the airport said accommodation was being found for the “distressed” passengers.

In the UK, air traffic control prevented three XL aircraft from taking off from Manchester Airport.

The XL group, which is based in Crawley, West Sussex, runs an airline and owns several travel companies, including Travel City Direct, Medlife Hotels Limited, The Really Great Holiday Company, Freedom Flights and Kosmar Holidays.

‘Going nowhere’

The company flies mainly from bases at Gatwick, Manchester and Glasgow airports.

Travel writer Simon Calder warned that many thousands of XL customers hoping to fly to the Caribbean, Mediterranean, North Africa and North America, from airports across the UK in coming weeks and days “simply won’t be going anywhere”.

Jim Duwaine, from Portsmouth, said he was given the news when he arrived at Gatwick where he had been due to catch an early morning flight to Menorca.

HELP OFFERED TO XL CUSTOMERS Flybe – offering flights for 90 euros (£71.50) BA– offering a one-way discount Easyjet– flights offered for £75 BMI – provided aircraft to CAA for transport people home Ryanair – has offered spare plane to CAA for transport

He said: “Absolutely devastated. Got up at midnight planning on going on holiday, but got let down, unfortunately. We’re here, just trying to get some other flights, but it’s not looking good. I think everyone else has got the same idea.”

Other holidaymakers have said they have been quoted vastly inflated prices for replacement flights.

Robert Spurgeon, of Norwich – an XL customer who had been due to fly to Tenerife from Gatwick – said: “We’ve not been told anything but my wife’s been quoted £2,000 for alternative flights.”

Also among those affected are a 130-strong choir on tour to Canada from Wales who were booked on Zoom and lost £50,000 when it folded last month, and then re-booked with XL.

XL is the current kit sponsor of West Ham United but football club said it would end the sponsorship deal and play on Saturday in an unbranded kit.

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Are you struggling to make your way home from your holiday destination? Have you paid for a holiday that you may not be able to take? If you were an employee of XL what are your views? Send us your comments

Arkansas party leader shot dead

Bill Gwatney was taken to hospital but died of his injuries

The chairman of the Arkansas Democratic Party has died after being shot by a gunman at the US state’s party HQ.

Bill Gwatney, 49, was shot several times by a man who barged his way into his office near the state capitol building in Little Rock, police said.

The attacker was shot and killed after a police chase, officials said.

Democratic Party chairman Howard Dean said Mr Gwatney’s killing was a “senseless tragedy”. Bill and Hillary Clinton said they had lost a friend.

“We are deeply saddened by the news that Bill Gwatney has passed away,” the Clintons said in a joint statement.

He was, they said, ” a cherished friend and confidante”.

The couple lived for years in the Arkansas capital of Little Rock while former President Bill Clinton was governor of the state.

Barack Obama, who competed with Hillary Clinton for the Democratic nomination to run for US president in November, also said he was “shocked and saddened” by news of the shooting.

Police have named the suspected gunman as 50-year-old Timothy Dale Johnson of Searcy, a town about 50 miles (80km) north-east of Little Rock, the Associated Press reported.

The motive for the shooting remains unclear.

A 17-year-old volunteer at the party headquarters building told AP that the suspect had pushed past staff to get into Mr Gwatney’s office.

“He said he was interested in volunteering but that was obviously a lie,” Sam Higginbotham said.

Mr Gwatney was taken to hospital in a critical condition and died of his injuries about four hours later.

He was a former state senator and was due to attend the Democratic Party’s national convention in Denver later this month as a super delegate.

He supported Mrs Clinton during the contest for the party’s presidential nomination.

Last December, a man who claimed to have a bomb strapped to his chest walked into Mrs Clinton’s campaign office in New Hampshire, prompting a hostage drama lasting several hours.

Top Italian car designer killed

Andrea’s firm has been hit recently by the economic downturn

Andrea Pininfarina, head of a world-famous Italian car designgroup, has been killed in a road accident.

Mr Pininfarina was riding a scooter which was hit by a car on the outskirts of Turin early on Thursday. He was 51.

He was chief executive officer of the family firm Pininfarina, which has designed sports cars for Ferrari, Maserati, Volvo and Fiat.

He was the grandson of Battista Pininfarina, who founded the firm in Turin in 1930.

Andrea’s father Sergio Pininfarina, 81, is the company’s honorary chairman.

The family currently controls 55% of Pininfarina’s shares, but under a restructuring plan it aims to cut its stake to about 30%.

The firm recorded a net loss of 114.9m euros (£91m; $178m) last year.

Israel mulls military option for Iran nukes

JERUSALEM – Israel is building up its strike capabilities amid growing anxiety over Iran‘s nuclear ambitions and appears confident that a military attack would cripple Tehran’s atomic program, even if it can’t destroy it.

Such talk could be more threat than reality. However, Iran’s refusal to accept Western conditions is worrying Israel as is the perception that Washington now prefers diplomacy over confrontation with Tehran.

The Jewish state has purchased 90 F-16I fighter planes that can carry enough fuel to reach Iran, and will receive 11 more by the end of next year. It has bought two new Dolphin submarines from Germany reportedly capable of firing nuclear-armed warheads — in addition to the three it already has.

And this summer it carried out air maneuvers in the Mediterranean that touched off an international debate over whether they were a “dress rehearsal” for an imminent attack, a stern warning to Iran or a just a way to get allies to step up the pressure on Tehran to stop building nukes.

According to foreign media reports, Israeli intelligence is active inside Iranian territory. Israel’s military censor, who can impose a range of legal sanctions against journalists operating in the country, does not permit publication of details of such information in news reports written from Israel.

The issue of Iran’s nuclear program took on new urgency this week after U.S. officials rejected Tehran’s response to an incentives package aimed at getting it to stop sensitive nuclear activity — setting the stage for a fourth round of international sanctions against the country.

Israel, itself an undeclared nuclear power, sees an atomic bomb in Iranian hands as a direct threat to its existence.

Israel believes Tehran will have enriched enough uranium for a nuclear bomb by next year or 2010 at the latest. The United States has trimmed its estimate that Iran is several years or as much as a decade away from being able to field a bomb, but has not been precise about a timetable. In general U.S. officials think Iran isn’t as close to a bomb as Israel claims, but are concerned that Iran is working faster than anticipated to add centrifuges, the workhorses of uranium enrichment.

“If Israeli, U.S., or European intelligence gets proof that Iran has succeeded in developing nuclear weapons technology, then Israel will respond in a manner reflecting the existential threat posed by such a weapon,” said Israeli Deputy Prime Minister Shaul Mofaz, speaking at a policy forum in Washington last week.

“Israel takes (Iranian President) Mahmoud Ahmadinejad’s statements regarding its destruction seriously. Israel cannot risk another Holocaust,” Mofaz said.

The Iranian leader has in the past called for Israel’s elimination, though his exact remarks have been disputed. Some translators say he called for Israel to be “wiped off the map,” while others say a better translation would be “vanish from the pages of time” — implying Israel would disappear on its own rather than be destroyed.

Iran insists its uranium enrichment is meant only for electricity generation, not a bomb — an assertion that most Western nations see as disingenuous.

Israeli policymakers and experts have been debating for quite some time whether it would even be possible for Israel to take out Iran’s nuclear program. The mission would be far more complicated than a 1981 Israeli raid that destroyed Iraq’s partially built Osirak nuclear reactor, or an Israeli raid last year on what U.S. intelligence officials said was another unfinished nuclear facility in Syria.

In Iran, multiple atomic installations are scattered throughout the country, some underground or bored into mountains — unlike the Iraqi and Syrian installations, which were single aboveground complexes.

Still, the Syria action seemed to indicate that Israel would also be willing to use force preemptively against Iran.

“For Israel this is not a target that cannot be achieved,” said Maj. Gen. Aharon Zeevi-Farkash, former head of Israel’s army intelligence.

However, it’s unlikely Israel would carry out an attack without approval from the United States.

Recent signs that Washington may be moving away from a military option — including a proposal to open a low-level U.S. diplomatic office in Tehran and a recent decision to allow a senior U.S. diplomat to participate alongside Iran in international talks in Geneva — are not sitting very well with Israel.

That may help explain recent visits to Jerusalem by Mike McConnell, the U.S. director of national intelligence, and Adm. Michael Mullen, chairman of the Joint Chiefs of Staff, each of whom delivered a message to Israel that it does not have a green light to attack Iran at this time.

Senior Israeli officials, speaking on condition of anonymity because they do not wish to appear at odds with their most important ally, said they were concerned about a possible softening of the U.S. stance toward Iran.

Apparently to allay Israeli concerns, Bush administration officials last week assured visiting Israeli Defense Minister Ehud Barak that the U.S. has not ruled out the possibility of a military strike on Iran. And the U.S., aware of Israel’s high anxiety over Iran’s nukes, is also hooking Israel up to an advanced missile detection system known as X-Band to guard against any future attack by Iran, said a senior U.S. defense official, who spoke on condition of anonymity because the discussions over the issue have not been made public.

With sanctions and diplomacy still the international community’s preferred method to get Iran to stop building the bomb, an Israeli strike does not appear imminent.

If it did attack, however, Israel would have to contend with upgraded Iranian defense capabilities, including 29 new Tor-M1 surface-to-air missile systems Iran purchased from Russia last year in a $700 million deal.

Russia has so far not gone through with a proposed sale to Iran of S-300 surface-to-air missiles, an even more powerful air defense system than the Tor-M1. An Israeli defense official said the deal is still on the table, however. This is a big source of consternation for Israel because the system could significantly complicate a pre-emptive Israeli assault on Iran.

Military experts say an Israeli strike would require manned aircraft to bombard multiple targets and heavy precision bombs that can blast through underground bunkers — something Israel failed to do in its 2006 war against Hezbollah. It’s widely assumed that Israel is seeking to obtain bunker buster bombs, if it hasn’t already done so.

Elite ground troops could also be necessary to penetrate the most difficult sites, though Israeli military planners say they see that option as perhaps too risky.

America’s ability to take out Iran’s nuclear facilities is far superior to Israel’s.

Unlike Israel, the United States has cruise missiles that can deliver high-explosive bombs to precise locations and B-2 bombers capable of dropping 85 500-pound bombs in a single run.

Yet the cost of an attack — by the U.S., Israel or both — is likely to be enormous.

Iran could halt oil production and shut down tanker traffic in the strategic Strait of Hormuz, which could send the price of crude skyrocketing and wreck Western economies.

It could stir up trouble for the U.S. in Iraq by revving up Shiite militias there just as Washington is showing some important gains in reining in Iraqi chaos.

It could activate its militant proxies in both Lebanon and the Gaza Strip, from where Israel could come under heavy rocket attack. And it could strike Israel with its arsenal of Shahab-3 long-range missiles — something Israel is hoping to guard against through its Arrow missile defense system.

Perhaps most importantly, any strike on Iran — especially if it’s done without having exhausted all diplomatic channels — could have the opposite of the desired effect, “actually increasing the nationalist fervor to build a nuclear weapon,” said Meir Javedanfar, an Iranian-born Israeli and expert on Iranian affairs.

Whether an attack on Iran would be worth its cost would depend on how long the nuclear program could be delayed, said Chuck Freilich, a former Israeli deputy national security adviser and now a senior fellow at the Harvard Kennedy School.

“A two, three-year delay is not worth it. For a five to 10-year delay I would say yes,” he said.

Yahoo board wins investor vote

Yahoo shareholders have voted to re-elect the firm’s board after it defended its handling of negotiations with Microsoft over a possible deal.

Chief executive Jerry Yang won the backing of 85% of investors at Yahoo’s annual meeting in California.

Some investors had criticised the firm’s failure to agree a deal with Microsoft, which had offered to buy the internet firm for $47.5bn (£24.1bn).

During the meeting, one called on chairman Roy Bostock to resign.

Shareholder Eric Jackson of Ironfire Capital – one of 150 investors at the meeting – said Mr Bostock “should do the honourable thing and step down from the board”.

He accused the Yahoo boss of overplaying his hand with Microsoft.