Pricing remains strong in the 2008 lates market and is unlikely to be affected by a recent Thomson Holidays offer of accommodation at £2 a night.
Average selling prices are about 10% higher than this time last year – largely thanks to reduced capacity, positive early sales and the trade holding its nerve and not cutting prices.
Even the cut-price Thomson room-only deal offering stays at seven hotels in Greece and Turkey in October for as little as £2 a night has been dismissed as a marketing tool and not the start of a price war.
Cosmos head of product and development Ian Hailes said mainstream holiday prices are about 10% ahead of last year, while volumes are 7% up.
He dismissed the Thomson deal as a way of unloading unwanted stock, adding: “Customers are coming in [to agencies] expecting last year’s prices –and they’re not getting them.”
Even within the eurozone – where the pound is weaker than elsewhere – the market is strong, said Classic Collection managing director Nick Munday. The company’s turnover has increased by 50% and passenger numbers have risen by 40% despite the current economic climate.
However, he warned: “We’re anticipating a slowdown but it is difficult to know what the extent of that will be.”
Advantage commercial director Julia Lo Bue-Said said mainstream holidays are about £70 per person more than this time last year – although this includes supplements.
The consortium is already addressing concerns that next year might prove tougher. Last week saw the launch of its Spread the Cost of Your Holiday campaign, which allows clients to pay monthly instalments to ease the cost of their holidays.
Kinver Travel owner Sue Foxall agreed pricing had remained strong. She does not believe Thomson’s £2 offer will affect the lates market, adding: “The consumer is going to be wary of something so cheap.”
A Thomson spokesman described the offers as targeted marketing and no reflection of the market or its own sales.