Booking.com halves Atol capacity in two years but hails Connected Trips ‘milestone’

Booking.com cut its Atol capacity in the September licence renewals despite reporting growth in bookings of ‘connected trips’ – packages – in its most recent financial results.

 

The online accommodation giant reduced its Atol by 157,000 to just over 1,114,000, less than half the 2,387,509 protected customers Booking was licensed to carry from the UK two years ago.

 

However, Booking reported hitting “a milestone” in ‘Connected Trip transactions’, or dynamically packaged trips, in its most recent financial results for the three months to June.

 

Chief executive Glenn Fogel reported that these “grew over 30% year over year and now represent a low double-digit percentage of Booking.com’s total transactions”.

 

The company has previously provided few figures for ‘connected trip’ bookings or revenue in its results.

 

It breaks down its gross bookings by ‘agency’ and ‘merchant’, and its turnover by ‘agency revenue’ (commission), ‘merchant revenue’ (a price mark-up on net rates) and ‘advertising and other revenue’.

 

Fogel insisted “we’re pushing forward our Connected Trip vision” in July, noting: “Travellers who book a Connected Trip with us, more frequently choose to book directly again with us.”

 

Booking has talked of developing ‘Connected Trips’ since acquiring tour operator software firm FareHarbor in 2018 and confirmed its focus on these in 2021 when Fogel argued: “When planning a trip you need a flight, a hotel and ground transport, and when something goes wrong you want one place to call.”

 

In 2023, Booking told Travel Weekly: “The priority has been to scale up a robust flight platform which will allow us to cross-sell other services.”

 

But the European Commission blocked Booking’s proposed €1.63 billion takeover of flight platform eTraveli that year.

 

Travel Weekly revealed in October 2023 that Booking.com was not selling packages under its own Atol but under the licenses of partner online agencies such as lastminute.com, and that it was using its own Atol only to cover flight-only sales.

 

A Booking spokesperson explained at the time that the company’s Atol figures “are for flight-only bookings” with the protection of packages “arranged via the partner”.

 

The Civil Aviation Authority (CAA) only requires Atol cover for seat-only bookings in certain circumstances, such as when a customer pays a deposit for a flight but receives the ticket on paying the balance.

 

Lastminute.com, which trades under the Atol of parent Bravonext and provides consumer financial protection of package holidays – or Connected Trips – sold by Booking, also reduced its licence at the September Atol renewals, cutting its licence from 754,456 to 732,024.

 

Taken together, the Atol reductions by Booking and Lastminute appear at odds with Booking’s strategy and claims of selling more Connected Trips, at least in the UK, in a period when sales of Atol-protected packages have boomed.

 

The total Atol capacity for the next 12 months hit a new record of 34.8 million following the September renewals.

 

However, a Booking.com spokesperson said: “Booking.com’s current UK Atol licence figures and the connected trips numbers are not directly comparable.

 

"Specific Atol exemptions are recognised by the UK CAA where certain flight-only bookings do not require Atol protection.

 

"Due to such exemptions we experienced a reduction in authorised passengers under our Atol licence even though our total passenger numbers continue to grow.

 

"The changes in licence capacity have no bearing on performance, scale or consumer protection.”