A survey by the Confederation of British Industry suggests travel firms have had a difficult summer despite recent positive trading by TUI Travel and Thomas Cook.
The study found business volumes at travel companies falling at the fastest rate for five years and the value of businesses and their profitability down for the second quarter in succession.
The quarterly survey of service-sector profitability concludes: “Travel services firms have had a particularly difficult quarter. Their business volumes fell at the fastest rate for five years.” It warns: “Further steep falls are expected over the next three months.”
CBI chief economic advisor Ian McCafferty said: “Profitability in the service sector is clearly under pressure.”
The findings contrast strongly with recent quarterly results from the UK’s leading travel groups, TUI Travel and Thomas Cook, showing demand for this summer in line with capacity and prices up year on year.
The survey of 176 firms across consumer service and business and professional firms was conducted between July 23 and August 6.