Ten of thousands of Thomas Cook holidaymakers were braced for two weeks of chaos as the firm teetered on the brink of collapse last night.
Government officials warned it could take a fortnight to repatriate the firm's 165,000 customers abroad – the largest such operation in peacetime.
Eleventh-hour talks to save the beleaguered 178-year-old company were going down to the wire last night, but without a breakthrough, the travel giant could be declared bankrupt this morning.
Yesterday, Thomas Cook executives were said to have begged lenders to slash demands for another £200 (NZ$398) million. Unless bosses can come up with the money, the prospects of a rescue deal look bleak.
Amid growing uncertainty, Foreign Secretary Dominic Raab poured cold water on the prospect of a Government bailout. But he signalled that officials were ready to give the green light to an unprecedented repatriation operation involving an emergency coalition of Europe's top airlines.
It came as:
• Britons on a Thomas Cook holiday in Tunisia said they were 'held hostage' by a hotel who feared it would not be paid by the firm;
• The company faced criticism for continuing to sell holiday packages,
and advertising more than 270 job vacancies;
• Customers warned of 'life-threatening' problems if trapped abroad without vital medication, while others despaired as their dream foreign weddings looked doomed;
• Company chief executive Peter Fankhauser – who has been paid £8.3 million since taking over the firm in 2014 – told staff he would not let the company 'fall over without a fight';
• Ministers faced demands from unions to step in and bail out the company.
About 165,000 Thomas Cook customers face being stranded abroad if the company goes under today, while thousands more who have upcoming holidays face huge uncertainty.
Whitehall sources warned last night that the repatriation plan would be far more 'bumpy' than rescuing the 84,000 customers stranded when Monarch Airlines went bust almost two years ago.
The Department for Transport and the Civil Aviation Authority (CAA) are in talks to lease aircraft under the plan – codenamed Operation Matterhorn – if Thomas Cook falls into the hands of administrators.
But these efforts are already being hampered by the lack of available planes due to the grounding of all Boeing 737 Max aircraft following a crash in Ethiopia in March.
Another problem is that Thomas Cook passengers are spread between 50 and 60 countries all over the world.
Manuel Cortes, general secretary of the TSSA union that represents the transport and travel sectors, said it "made no sense" for the Government not to bail out the company.
But Mr Raab said ministers did not step in to save flailing firms unless there was "a good strategic national interest". He did promise that the Government would step in to repatriate every customer, including those not covered by the official Atol protection scheme for package holidays.
Thomas Cook has said that if it did go bust, those who booked package holidays were fully protected by the industry's Atol scheme – both now and for future trips.
But about half of passengers currently abroad do not have this protection because they booked Thomas Cook flights only.
Yesterday, passengers at Gatwick and Manchester were seen rushing to board flights amid concerns that the company could fold before they left the country.
Despite the fears about the company's future, package holidays across the world remained on sale yesterday, while up to 270 staff vacancies were being advertised. The collapse of the company will put 22,000 jobs at risk, including 9,000 in the UK, and lead to the possible closure of its 563 high-street travel agents.
In an email to staff on Saturday night, Mr Fankhauser promised that he would not let the company "fall over without a fight".
He said the company had come under "relentless pressure" and begged staff to continue serving its customers as normal despite the possibility of collapse. He wrote: "I know how powerless all of us feel in the current situation. After months of relentless pressure, none of us can be in any doubt that we have reached an absolutely critical moment for the future of this business."
Questions will be raised about why executives at the company have been paid multi-million bonuses while leading the firm to near financial ruin.
Mr Fankhauser did not comment as he left the talks in London last night.