TUI Travel has seen no downturn in demand amid growing economic concern and reported a 22% fall in group losses for the winter in half-year figures to the end of March.
Europe’s biggest travel group said there was also no evidence of downward pressure on prices or of consumers booking shorter holidays.
In its first half-year results since the merger of TUI and First Choice, the group reported mainstream sales in the UK up 8% on last year for this summer and 21% fewer holidays left to sell than in May 2007 following capacity reductions. This had led to “strong pricing” over the last six weeks, said the group.
But TUI will continue to slash capacity, flying six fewer aircraft in the UK this winter and ten fewer next summer.
The group reported a six-month operating profit of almost £5 million in its specialist division, compared with a £5 million loss in the same period last year, and a reduction of £65 million in losses in its larger mainstream holidays division, where half-year losses fell to £244 million.
TUI Travel chief executive Peter Long said: “We see no evidence of deteriorating consumer sentiment in our booking patterns, in the average holiday duration, average selling price or cancellation rates.”
Long acknowledged the industry faces “a more challenging economic environment”, but said TUI was “well positioned to deal with it”. “Demand for summer 2008 is strong, with less holidays left to sell,” he said.