Tui chief executive Sebastian Ebel emphasised the group’s caution on capacity for this summer when presenting results for the three months to December on Tuesday.
Ebel described the group as “careful” on capacity for this year and “more looking at margin”, suggesting he was “comfortable” despite a “somewhat slow start” to peak-season bookings in January.
He said bookings “picked up considerably in the last days” but insisted: “We are comfortable because we have not increased capacity.”
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Ebel also stressed the contribution of independent retailers in the UK, saying the group had invested “significantly” in third-party retail.
He emphasised Tui had been “cautious on fixed capacity”, noting: “Bookings have been slower at the turn of year. It’s important we didn’t increase our capacity.”
Ebel argued: “We want to grow with dynamic packages. We’re careful with fixed capacity. We’re comfortable with the capacity we have. We have been less aggressive with capacity and with pricing. We want to grow with dynamic packaging which is risk free and good margin.”
He suggested: “The opportunities with dynamic packaging are more in the UK [than in Germany].”
The Tui chief noted: “We just brought Ryanair into the market [in the UK] in December.”
Tui reported 700,000 dynamic-package bookings in the three months to December, 18% up year and year and Ebel noted Tui’s partnership with Ryanair in the UK “only just started, so we will see stronger sales”.
Ryanair and Tui announced a distribution deal last February, but the technology integration was only completed late in the year.
Ebel also suggested Tui’s investment in sales through independent agents in the UK is paying off, noting: “We invested quite significantly in third-party retail [in the UK]. We’ll see the benefits in the second half [of the financial year].”
He argued: “Third-party retailers are very important. Our team in the UK is doing a lot of work with other retailers. We put a lot of effort into it. Why? Not altruistically, [but] for commercial reasons. This brings value to customers and for us – with higher end customers.”
Tui’s markets and airlines division, which includes its tour operations, saw a 6% rise in passenger numbers year on year in the three months to December, with the group carrying 3.7 million in total and reporting a 13% rise in revenue to €4.9 billion.
Ebel reported a 64% reduction in group loss for the quarter to €30 million.