In the week that the UK had been due to leave the EU, a group of travel executives met to discuss the state of the market in a debate hosted by Hotelplan UK and Travel Weekly. Lucy Huxley reports
John Sullivan, head of commercial, Advantage: “There’s some Brexit fatigue. The mass market is the most-impacted. It’s running flat on last year. However, outside of that, cruising, long-haul and luxury are doing OK. Some members are saying it’s the best January and February ever. Others are having a harder time.”
Karen Wheeler, vice-president and country manager UK, Affinion International: “The higher end is still booking. We had a very flat March. But cruise and high-end bookings are doing OK and the average booking value is good.”
Nick Marks, joint managing director, Baldwins Travel: “January was seriously down. February was very good – almost a spike, and March has been static. We are struggling with bookings to Europe because people are worried. They are asking if we can guarantee that their flight is going to take off and come back.”
Gary Anslow, sales director, Cunard: “This year is much tougher than 2020 for the cruise industry. People are booking cruises, but 16-18 months out. I believe they are still going to book 2019, it’s just that every week their proposed booking date is moving back.”
Dean Harvey, marketing director, Kuoni: “Kuoni is in that sweet spot. We sell luxury beach and a bit of cruise. Peaks is becoming less peaky, and forward bookings are going through the roof. Much of luxury beach is around weddings and honeymoons, which Brexit isn’t going to impact.”
Richard Sinclair, managing director, Sno: “There is huge pent-up demand but people just aren’t pulling the trigger.”
Joe Ponte, managing director, Explore: “We’ve seen our strongest start to the year for four years, but Europe sales are down by double digits, while the rest of the world is massively up. This means our average booking value is also up.”
Maria Whiteman, managing director, Saga Holidays: “Customers are taking one long-haul trip instead of maybe three or four short-haul ones. So the overall effect is that spend is down.”
Phil Gardner, sales and e-commerce director, Thomas Cook: “If you look at Cook online, [our] conversion [rates] for Turkey, Egypt and Tunisia are two‑and-a-half times what it is for Spain and Portugal.”
Karen Wheeler: “We are seeing a lot of bookings to Egypt.”
Joe Ponte: “We are also seeing bookings back to the Middle East.”
Ski market
Paul Carter, chief executive, Hotelplan UK: “Inghams is very European-biased, and it’s very telling that Switzerland and Norway, which are both outside the EU, are up. They are bucking the trend. People have no concerns about whether they can get there and back.
“March 29 should have been one of the busiest weeks here, but this week and next have been really hard as they were the week before and after we were due to be leaving the EU.
“They have proved to be the toughest two weeks and that’s definitely the Brexit factor.
“Skiers are resilient and forward bookings are good. But Brexit has definitely impacted late demand this year, particularly late March.”
Richard Downs, chief executive, Iglu.com: “There is still demand but people are definitely changing the destination that they are looking for. We haven’t seen this before. It has to be Brexit. Nothing else can explain it. There’s a margin squeeze because we’re all paying more for marketing costs. There are a lot of tyre kickers who are waiting to book.”
Discounting
Nick Marks: “Everyone has just got to hold their nerve. Our message to suppliers is ‘please don’t panic and don’t discount’.”
Maria Whiteman: “That would be ideal [not discounting], but that just can’t happen. We operate river cruises, for example, that have to sail. If we have a commitment, then we have to shift it, so everyone is discounting.”
Phil Gardner: “Mentally I support that [not discounting], but it’s just not possible when you have committed stock.”
Joe Ponte: “We have launched our post-Brexit campaign today to give people a reason to book.”
Airline capacity
Alistair Wilson, managing director, Titan Airways: “The reality is, a no-deal Brexit would damage so many people and so many businesses. There will be redundancies. This winter has already been unprecedented with the demise of Primera, Small Planet and Germania.”
Adrian Keating, commercial director UK & Ireland, Air Transat: “We’ve diversified our distribution channel. We’ve flown to the UK for the last 30 years, but we have only opened up to the trade in the last six months. It just keeps growing. 60% of our revenue is from our website, which is an abnormal figure. We have a 3% share of the market [UK to Canada] so the opportunity is huge. We have Westjet coming in big and hard too.”
Colin Stewart, UK and Ireland director, Air Europa: “Too many airlines are operating in and out of Europe – there are about 30 – and capacity is squeezing the price down. Booking a flight has never been so affordable for a consumer.
“I’m noticing more than ever that consumers don’t care about airlines as long as it’s safe and financially sound. I think there will be both consolidation and failures. We tend to follow what happens in the US and they have consolidated into four groups. We’re in the process of talking to Air France-KLM about a joint venture.”
Richard Downs: “There will be more failures. If I was a well-funded airline with a strong balance sheet, I would have been upset that the government did so much to help Monarch. I would have been more upset if I was an Atol-bonded tour operator, after passengers not covered by Atol were still brought back home following the Monarch crash. It’s not right. The government came out with flying colours, but it does question Atol and what it delivers.”
Paul Carter: “The CAA is taking more time than ever before. We are hearing that the process of getting an Atol licence is much longer. They are getting stricter and doing more due diligence.”
