‘Genuine partnerships key’ as trade anticipates tough year

The Travel Network Group chief executive Gary Lewis warned suppliers not to attempt to “cherry-pick” travel agents as a panel of industry experts predicted a tough 12 months for the trade.

Lewis stressed the need for agents and suppliers to support each other in consistent, long-term relationships through “good and bad” times and highlighted challenges this year, including a later-booking family market, a move to shorter durations and increased demand for value.

Speaking at a Travel Weekly Business Breakfast during Abta’s Travel Convention in Calvià, Majorca, he added: “When times get tough it is important to carry on supporting the [TTNG] members. I don’t want to hear [suppliers saying], ‘We are going to concentrate on our business and cherry-pick some really good members and concentrate on them for this tough time’.”

Lewis said September trading indicated the first signs of a slowdown after a number of record years, adding: “June was very good, July was OK and September was the first time we have seen red numbers like for like since 2021.”

He urged agents to show their value to suppliers by understanding exactly what customers want in the current market and focusing on the “controllables”.

Lewis’s comments came in response to Nicki Goldsmith, Virgin Atlantic director of global agency sales, who said the airline would be “tightening up” its distribution to focus on high-yield sectors, including cruise and touring specialist agents.

“We will focus on sectors that can deliver the best yields,” she said, but insisted: “We will continue to support the trade. The trade is extremely important to us.”

Goldsmith cited “some bright spots” in UK trading, adding: “We are not seeing a slowdown going into the US. However, coming back into the UK is more of a pressure point and going into some of our global city destinations, so that’s putting pressure on our ticket price.”

Andy Freeth, Travcorp Holdings chief executive, told the panel it was important suppliers acted “swiftly” to respond to challenging market conditions, citing a “flat September” and noting recent decisions by companies such as Jet2 and Ryanair to reduce capacity.

“It will be a tough 12 months for all of us. Consumer confidence is our biggest challenge: if that dips we are in a bit of a pickle,” he said.

Henry Wells, head of consumer M&A at Cavendish, said: “I am really positive about the next 24 months but there will be some serious bumps in the road. What we are seeing now is that travel is less interesting to financial institutions than it was.”

Speaking in a mainstage session, Jet2 chief executive Steve Heapy and Tui UK & Ireland managing director Neil Swanson also highlighted concerns about consumer confidence due to uncertainty ahead of the government’s Budget next month.

Heapy urged the government not to use the travel sector as a “cash cow”, adding: “We put an enormous amount of money into the UK Treasury [and] we employ a lot of people. I hope the government doesn’t forget that.”