Travel firms report sales slowdown for first time this year

Travel firms have reported a slowdown in sales in the last week for the first time since the start of the year as fears grow about how long the Ukraine conflict will last.

Travel agents and tour operators are yet to see widespread cancellations for holidays outside the affected region but noted rising levels of nervousness among clients.

Firms admitted the length of the war could determine its impact on trading, particularly if it continues into next month when balances are due for peak summer holiday bookings.

The Holiday Village managing director Paula Nuttall said: “If the war carries on, would some people be prepared to lose a £60 deposit on a holiday? We normally take balances 12 weeks before departure so we’ll have a clearer picture next month.”

Nuttall reported a “slight slowdown” in summer 2022 bookings but increased sales for winter 2022, summer 2023, and in the last four days, UK staycations. “We’ve not seen that since the start of January,” she added.

Advantage Travel Partnership members’ sales dipped 4% last week compared with the previous week, with bookings to Turkey through the consortium’s managed service agents down 23% week on week.

Leisure director Kelly Cookes said: “Prior to this volumes were increasing each week or holding. The last two weeks they have decreased week on week.

We’re not really seeing a big impact [of the war] on volumes at this stage [but] members are reporting some customers are nervous and this is impacting where and when they choose to travel. We’ll start to see the scale of the nervousness the closer we get to Easter.”

The Travel Network Group said trading was “noticeably quieter” for some members compared with February. Clients who were happy to book prior to the invasion were now “very nervous” and needed reassuring, said a spokeswoman.

Hays Travel Northwest managing director Don Bircham said March trading was a “similar levels” to 2019 but noted a “high level of cancellations” early this week. He said: “I’ve yet to drill down into the reasons but it did concern me it could be a result of the war and the ‘cloud’ it creates as well as rising costs of domestic fuel and petrol.”

Independent Travel Experts managing director Gary Gillespie said “some customers have decided not to book just yet” because of the war, but stressed there was no “noticeable impact on sales as yet”.

Journeys a la Carte senior travel consultant Claire Bell, who has had one client delay booking a Florida holiday in May due to the war but no cancellations, said: “Everyone is desperate to go away.”

But she admitted: “We might notice it for the summer, it’s bad timing.”

Operators feared increased living costs would hit trading.

Sunvil managing director Chris Wright said: “I think the impact of the rise in cost of living is likely to have more of an impact than the war itself.”

He added Covid remained a bigger worry for clients than the Ukraine currently, but said the war was likely to cause some “nervousness” among clients.

Bharat Gadhoke, head of commercial at Aito, the Specialist Travel Association, said:  “I fear the gains we have made in travel opening by the lifting of Covid restrictions will be lost by a drop in consumer confidence as a result of the conflict. Add to this the increases in the cost of living and the impact on travel may be made more severe.”

He said Aito members had reported a slowdown in bookings since the start of the conflict, with one or two reporting a bounceback in the last few days. “Consumer confidence has been dented; when it will return is anybody’s guess as the war drags on,” he added.

Greenstar Travel managing director Martyn Fisher predicted bookings would be hit if the war were to spread outside Ukraine’s borders. “Then people will start to get worried and that would dent confidence in travel,” he said.

Barrhead Travel president Jacqueline Dobson urged the industry “to monitor the situation carefully” and “stay close to customer sentiment” as summer approaches.

Ramifications of the war have already been felt in the wider travel industry.

Two Russian members of the Tui Group supervisory board have stepped down following Russia’s invasion of Ukraine and the EU and UK’s impositions of sanctions on wealthy Russians connected to Putin’s regime. Alexei Mordashov, Tui’s largest shareholder, and Vladimir Lukin have both resigned.

Jet2holidays cancelled some departures to Poland and Bulgaria.

And the trade’s three major global distribution system suppliers have terminated the distribution of Russian flag carrier Aeroflot tickets. Sabre, Amadeus and Travelport all said they were removing Aeroflot content to stop further ticket sales through their systems.

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