Holiday prices and value predicted to return to pre-pandemic levels

Holiday prices may rise in the next two to three years after a short-term drop, but will eventually return to pre-pandemic levels of value, according to the boss of Kuoni parent Der Touristik UK.

Derek Jones told a Travel Weekly webcast: “I think you have to look at this in time periods. There’s a short to medium period where coronavirus is still prevalent to some extent, where we’re moving back into the travel sphere whilst also coping with coronavirus and minimising the spread of it.

“Hopefully there’s a period beyond that, where that’s no longer the case; where coronavirus is controlled and we can sort of get back to some normality.”

Jones said that increased operating costs in the short-term were likely to be offset by the desire of hoteliers to want to fill their properties.

“Everyone’s going to be trying to get their market back and put good rates in place so I don’t think there’s going to be an escalation of price,” he said.

“If anything, I think you might see some really good offers in the marketplace right through to the middle of next year, at least.”

But he said the long-term outlook was a little more complicated, particularly in the scheduled arena.

“I think we will see capacity constrained over the next maybe two, three years, which inevitably is going to mean the prices will start to move as they yield off lower capacities,” he said.

“But my hope is that on the destination side, the properties will continue to want to make sure that they’re taking a slice of that. So you might find that the price mix will shift towards the means of getting there becoming more expensive, but the land prices once you’re there being slightly lower.”

Jones said he did not envisage pricing changes being permanent.

“I don’t see a fundamental shift in the position of holidays in terms of value, I think it will level back to something similar to the position we’re in today,” he added.

EasyJet Holidays commercial director Alex Loftus confirmed hoteliers were offering extremely good rates for 2021.

“At the moment hoteliers are offering us unprecedented offers for the next year, which is obviously a huge benefit to the consumer.

“We will look at what we need to do going forward, but from a holidays point of view, we’ve got access to a huge amounts of seats on our airline, easyJet, so I think there will still be a huge amount of choice and flexibility to the customer.”

He added: “We’ll wait to see what other guidelines need to come in place. But I think, like all of us, we’re keen to still offer great value holidays. That’s what easyJet and easyJet Holidays is all about, and we’ll work very hard to do that.”

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