Uncertainty over government travel restrictions won’t have a lasting effect on the market despite the UK tailing other major source markets in Europe, says Tui boss Fritz Joussen.
But the cost of PCR tests is having an impact even as bookings rebound, according to the Tui chief executive.
Joussen dismissed a suggestion the UK market would suffer lasting harm, insisting: “August and September will be stronger.”
Speaking as Tui reported results for three months to June, Joussen noted capacity for the summer had been reduced from a previously forecast 75% to 60% “because we are missing bookings from the UK”.
He said: “We’ve not been adding bookings in the UK, we’ve been losing bookings.” By contrast, he said: “Germany has very strong bookings.”
Tui reported 280,000 bookings in Germany in July, double the UK figure, when Joussen said: “Usually the UK should be at least as big as Germany.”
But he insisted: “It will come. The last four weeks were much better. When we look at summer 2022 we are at an all-time high.”
Asked if UK restrictions could have a lasting impact, Joussen said: “No. The UK had a very good vaccination programme. The politics on international travel were different. Portugal was on the green list, then it was off. Customers didn’t know what to do.
“We had 1.5 million guests booked in the UK, but when it changes so often people cancel or move their bookings.
“Uncertainty is one driver. The other is the extra cost. Even if you’re vaccinated you need to take a test and PCR tests cost £60, times four when you are a family.
“We subsidise it [the cost of testing] in the UK, but it is adding cost. When a normal vacation costs £4,000 and suddenly it costs £4,500, the extra cost has an effect.”
Joussen acknowledged bookings in Germany had also been hit by uncertainty over restrictions on travellers returning from Spain, with bookings dipping substantially between mid-June and late July.
He said: “The big bookings in Germany came early in the season. It’s clear they go down. The dip is related to Spain and the uncertainty. People just waited.”
Yet he insisted bookings around the Mediterranean have rebounded, saying: “The programme increased so much from June to July. In Southern Europe, very often we have a scarcity of capacity.
“The trend is last-minute. In the last week we added 15%. People more or less wait until they depart.”
At the same time, he said: “Prices are higher than 2019 – people are generally booking longer and more five-star than four-star.”
The group reported summer 2021 average selling prices up 9% on summer 2019.
Joussen forecast “a stable programme for Q4 [July to September] and for next year” and said: “It’s hard to forecast but I expect a decent winter.”
Asked when holidays to the US might resume, he said: “Travel into the US is non-existent [and] there is no indication when that will change. But from the US to the Caribbean is enormous. Our Caribbean hotels are booked almost at the pre-crisis level.”