Cost-conscious consumers appear to be driving increased demand for ‘value’ destinations such as Tunisia and Bulgaria this summer.
Leading tour operators continue to report strong bookings, with three of the top-five Atol holders issuing updates on trading in the past week, but with Jet2 warning “profit margins may come under some pressure”.
Tui chief executive Sebastian Ebel described trading in the past three weeks as “strong” and said: “We see Egypt, Tunisia and Bulgaria picking up bookings like we haven’t seen for a long time. Sales to Turkey are slightly more challenging because of costs.”
He reported Tui had been “careful with fixed capacity this year” and not followed Jet2 in increasing inhouse capacity, saying: “We want to grow on the dynamic packaging side.”
Ebel said: “I’m confident we’ll see growth, but how much I don’t know. It could be the market is later.”
In Europe, he said “the economy is not so well”, adding: “We want to grow. But we’re not growing for the sake of growing. This year we’re cautious. We focus on balancing risk. There will be growth when we see growth patterns.”
Jet2 reported the “closer to departure” booking trend of last summer continued through the winter, with its 14% increase in capacity year on year leading to “competitive” pricing and a small drop in average load factor.
The operator reported its capacity for this summer is up 8.5% year on year, with just under half the increase due to new bases at Bournemouth and Luton. Jet2 said bookings for April to June were up 7% and that pricing “remains keen”, but it made no mention of bookings for the July‑to-September peak quarter.
On the Beach reported “strong early bookings” for summer, with total transaction value up 10% year on year. It said the value of bookings for the current winter was up 18% and the value of departures in March to June up 17%. However, the figures include Irish bookings following the group’s “first targeted marketing campaign” in Ireland.
On the Beach also gave no breakdown of booking numbers or average price or detail for July-to-September bookings.
Agents confirmed interest in less-costly destinations among price‑sensitive consumers.
Caroline Thorne, head of travel for East of England Co-op Travel, noted: “People want value. Destinations such as Morocco, Tunisia, Bulgaria and Egypt are doing well for families this summer and, beyond that, for couples. Some customers are definitely more price-conscious and taking longer to decide.”
Arrive Relax Travel owner Angie Akister agreed consumers “are very price-focused and checking online prices against retail” while insisting trading is “still very busy”. She said Greece remained popular at the Norfolk-based agency, while Malta had risen in popularity.
Heidi Evans, director of Oasis Travel in Stoke-on-Trent, said: “We’ve had quite a few bookings for Tunisia; it’s good value for money, especially for families who don’t have £4,000 to go to Spain.”
Kelly Cookes, chief commercial officer at The Advantage Travel Partnership, confirmed: “Feedback from members is that it’s very competitive, with customers shopping around and lots of aggressive discounting.”