Price reductions from almost all tour operators

The travel prices are falling with more and more providers. After the industry leaders TUI and Thomas Cook, the number three in the German travel market, Rewe Touristik, is also lowering the prices for the coming winter season with its package providers ITS, Jahn Reisen and Tjaereborg. Thanks to the elimination of kerosene surcharges and the improved purchasing conditions, the company will offer its trips an average of five percent cheaper, announced the head of Rewe Touristik GmbH, Rembert Euling. According to his words, Thailand vacationers can save 14 percent.

The market leader made the start

The industry leader TUI started with the big tour operators. Trips in the winter catalog would be five percent cheaper on average, the company announced at the end of June. TUI also justified the move with more favorable terms for purchasing hotel rooms and lower kerosene prices. The price reductions on long-haul flights to Asia are particularly high. However, vacationers also benefit from significantly better conditions on connections within Europe and to North Africa.

Thomas Cook followed the TUI example with the same reason: across all destinations, prices at Neckermann Reisen would be reduced by an average of five percent and Thomas Cook Reisen would be reduced by an average of three percent. Alltours announced a minus of six percent, Turkey specialist oger Tours is lowering prices by seven percent.

Price pressure also in the summer season

Even in the current summer season, tour operators can hardly ignore the price pressure. "People will still book their vacation, but they’ll do it later," Thomas Cook had predicted at the beginning of the year when bookings fell by 15 percent and more shook the industry. According to a GfK survey, despite the economic uncertainty, hardly fewer people want to travel this summer than in 2008. However, the fact that so many have delayed their decision so far has put pressure on prices.

The German Travel Association (DRV) sees it similarly. After the reluctance at the beginning of the year, the booking engine has now started, the DRV announced. The tourism sales in the travel agencies in June were only slightly below the previous year. "It will be booked later this year than usual and we will pay attention to a good price-performance ratio", said the president of the association, Klaus Laepple.

Falling prices yes – discount war no

The number of vacation trips is therefore likely to decline only slightly overall – but only because falling prices will keep demand high. But that works, explains NordLB analyst Martina Nob, because purchasing has become cheaper due to the increased market power of the corporations. "The hotels have to accept lower prices."

As a result, tour operators have better prospects than they did seven years ago, when demand was low because of the terrorist attacks in New York. At that time the tourism companies fought a real discount battle at the expense of their profits. This time too, the corporations have to prepare for declines in sales and earnings. But analysts estimate that it will not be as violent as it was in 2001. In anticipation of worse business, most providers ordered significantly fewer airports and hotel beds when creating their catalogs last autumn. Customers can therefore not hope for a drop in prices like after September 11, 2001: "The discounts will probably be three to four percent in the end – but that is little compared to the double-digit minus after 2001," says BHF Bank analyst Nils Make flour.

Leave a Reply

Your email address will not be published. Required fields are marked *