Cash-strapped consumers are still prioritising spending on holidays but are choosing more affordable destinations including Egypt, Bulgaria and Tunisia for their annual break, according to Europe’s biggest package trip operator.
Quoted by The Guardian, Tui said new customers with smaller budgets who are not able to find a package holiday in more traditional locations such as Spain are looking elsewhere.
Inflationary pressures have eased, the travel company said, and the average selling price of its holidays have levelled out, although the cost of a trip remains at a “significantly higher level” compared with 2019.
Prices are “at a level where we think it will remain”, said Sebastian Ebel, the group’s chief executive.
“We also see quite often new customers who have less income but still want to travel, and they have a budget of €1,000/£800 per vacation, and if they don’t see it in Spain, then they look for alternatives, and they find alternatives,” Ebel said.
The widespread return of travelers to Tunisia and Egypt marks a turnaround for the countries as holiday destinations after a series of terror attacks around 2015 led to a plunge in visitor numbers.
Meanwhile, Tui reported an annual pre-tax profit of €1.3bn (£1bn) in the 12 months to the end of September, a 35% increase compared with a year earlier.
The company said the strong performance of package holidays and in its cruise division contributed to the rise in operating profit, helping the business to strengthen its finance and bring down its debt levels.
