AVRO
has slammed the Big Four for dumping seat-only capacity at prices as low as
£47.
The
UK’s biggest flight-only company said desperation by the likes of First Choice
and Thomson to shift unsold holidays was destroying yields.
Commercial
director John Fitz-Gerald said: “Seat-only prices are being driven very low by
the vertically integrated companies. There is lots of stock available, more
than they are admitting, so they are dumping seats at unprecedented prices.
“Our
sales are reasonably strong, but yields are down.”
Fitz-Gerald
said prices last Saturday with First Choice were down to £47 for Birmingham to
Malaga, and £59 from Gatwick. He admitted last Saturday and the coming weekend
were trough periods, with flights this Saturday from £145 with First Choice,
but prices were not picking up for peak periods from July 20. “Fares are around
£30 cheaper than usual, at prices below what it costs to run the flight,” said
Fitz-Gerald.
“There
are a lot of flights available in the peak periods. We would usually have half
what we have now.”
First
Choice managing director Neil Morris said: “As the market tightens prices will
go up. Prices were soft but are now heading in the right direction.”
Morris,
who looks after seat-only for First Choice, added the industry still had
pre-school holiday prices, but with more people buying packages, fares will
rise.
His
comments were echoed by Thomas Cook UK chief executive Alan Stewart.
He
said: “I am quite convinced there will be strong demand for the high season.
History shows prices stay firm in the peak period but the next few weeks are
key.”
There
are believed to be 2.5 million holidays left to sell for this summer, with
Thomas Cook and First Choice having just under one million between them to
shift.