TUI Travel has now cut its UK winter 2008/09 capacity by a total of 28% in order to maintain stronger average selling prices, a trading update has revealed.
The total drop in capacity, which comes as a result of another 9% cut since the group’s pre-close statement, has helped the operator maintain selling prices 10% up on the previous year with prices 12% ahead over the last eight weeks.
Following the cuts, the operator has now sold half its entire winter stock which leaves it at an equal pegging on sales with this time last year although it has 9% less stock to sell.
The winter capacity cuts offer some taste of plans for next summer, in the UK TUI has reduced capacity by 16% for summer 2009. The resulting cuts have meant average selling prices are up by 11%, even though the volume of sales is 17% lower.
TUI added summer 2008 closed in line with expectations with average selling prices closing 11% up despite a 4% reduction in customers but following a 6% capacity cut.