Market Update - 16.10.24
CURRENT MAJOR TOPICS WITHIN THE TOURISM INDUSTRY IN THE DACH REGION
- Young people are optimistic about the future despite fear of crises: According to the Shell Youth Study, many have a positive relationship with the state and society and see great personal opportunities for the future. Around 75% of those surveyed are satisfied with democracy and interest in political involvement has increased. Despite a significant group of disappointed young people who are susceptible to populism, trust in state institutions remains stable. Men in particular are more likely to position themselves on the right, while there has been a slight decline in satisfaction with democracy in eastern Germany. Young people are concerned about issues such as war and economic uncertainty, but fear of unemployment is at an all-time low. Opinions on current conflicts such as the war in Ukraine and the war in Gaza are divided, with educational backgrounds having a strong influence on views. Overall, the authors of the study reveal a resilient generation that, despite many crises, cannot be described as a “crisis generation”.
https://www.zeit.de/gesellschaft/2024-10/shell-jugendstudie-kriegsangst-optimismus-demokratie
- Germany had more tourists in August than ever before: Germany recorded a historic high in tourist overnight stays in August 2024. With 59 million overnight stays by domestic and foreign guests, the tourism industry achieved its strongest month ever and surpassed the previous record from July 2019. Campsites in particular contributed to the increase, with 9.7 million overnight stays - also a new record. A notable increase came from foreign tourists, whose overnight stays rose by 5.7% year-on-year to 10.1 million. Overall, the number of overnight stays in Germany grew by 3.3% compared to August 2023.
- Travel agency sales in September just below previous year: In September 2024, travel agency sales were 1.3% below the previous year's figure according to the Tats travel agency survey, but the cumulative annual figure shows an increase of 1.7%. At minus 0.8%, incoming orders were almost at the previous year's level. Cruises proved to be the sales driver with growth of 5.1% compared to September 2023 and a cumulative increase of 7.5%. Tourism sales, including cruises, were down 3% year-on-year in September, while the flight sector recorded a decline of 3.1%. Cumulatively, the flight sector was up just under 2% on the previous year. The order backlog for tourism bookings rose by 4.6%, while cruises increased by 13%.
https://www.reisevor9.de/inside/reisebueroumsaetze-im-september-knapp-unter-vorjahr
- DRV Congress: Early bookers return: The DRV Congress in Berlin shows a successful tourism year 2023/2024, despite ongoing challenges. According to DRV President Norbert Fiebig, tour operator sales increased by twelve percent compared to the previous year, while eight percent more guests traveled. Particularly noteworthy is the return of early bookers, especially families, who planned their summer vacation as early as autumn 2023. Popular destinations in summer were Turkey, Spain, Greece, Egypt and Italy, with the Eastern Mediterranean region recording an eleven percent increase in sales. Cruises experienced the greatest growth with an increase of 14 percent. The outlook for the fall and winter seasons is also promising. In October, bookings rose by 18% compared to the previous year, with classic winter destinations such as the Canary Islands, Egypt and long-haul trips to Thailand and the USA particularly in demand. The cruise segment continues to boom, with a 28% increase in sales in the winter business.
- DRV Congress: President Fiebig warns against “naivety”: At the DRV Congress in Berlin, President Norbert Fiebig warned against overconfidence in the tourism industry, despite a successful year. Fiebig referred to global crises such as the wars in Ukraine and the Middle East, Germany's weak economic situation and rising personnel costs, which could also have a long-term impact on the tourism sector. While turnover in tourism is twelve percent higher than the previous year and 21 percent above the pre-corona level, Fiebig warns not to underestimate the challenges facing the industry, particularly due to economic uncertainties. The congress in Berlin will address important topics such as the future of tourism, sustainability, the amendment of the Package Travel Directive and the shortage of skilled workers. Fiebig criticized the planned changes to the Package Travel Directive, which could place a burden on travel agencies and tour operators in particular, and regretted TUI's withdrawal from the DRV. Despite positive developments in the industry, such as the increasing importance of package tours and the successful handling of FTI's insolvency by the German Travel Guarantee Fund, the shortage of skilled workers remains one of the biggest challenges. Young professionals in particular expressed their desire for personal development and active involvement, especially in the areas of sustainability and responsible travel.
- Strong bookings for fall vacations and winter: The 2023/24 tourism year is seeing strong bookings for fall vacations and winter, with significant sales growth. According to DRV President Norbert Fiebig, tour operator sales are 12 percent up on the previous year and 21 percent above pre-corona levels. Guest numbers are approaching pre-pandemic levels, with families in particular contributing to the increase in demand. All-inclusive trips and package tours are particularly popular, with the proportion of organized trips back at 48%. Turkey is the most popular destination, followed by Spain, Greece, Egypt and Italy. Cruises recorded the strongest growth in the summer with an increase of 14%. Things are also looking good for the fall: Sales for trips in October have risen by 18 percent, with destinations such as Antalya, Mallorca and Crete being particularly popular. The early booking trend is continuing for the 2024/25 winter season, with an increase of 17%. The Canary Islands, Egypt, Thailand and the USA are particularly popular. Long-haul destinations such as the Maldives, the Dominican Republic and Mexico are also very popular. Cruises remain a fast-growing segment, with sales up 28% for the coming winter. Demand is also already high for the 2025 Easter vacations.
- Mood in sales deteriorates slightly: In October 2024, the sales climate in the travel industry deteriorated slightly, but remains optimistic overall. According to Dr. Fried & Partner's Sales Climate Index, 51.7% of travel agencies surveyed (stationary and online) rate the current situation as good, less than in the previous month (58.2%). 40.8% rate the situation as “satisfactory” (previous month: 35.8%) and 7.5% as “poor” (previous month: 6.1%). Despite this slight deterioration, 30.7% of respondents expect demand to increase in the next six months, while 56.3% expect demand to remain the same and only 13.1% fear that demand will fall. Particularly positive impetus is coming from strong bookings for the autumn vacations, winter season and Easter vacations in 2025. 32.4% of travel agencies see an improvement in earnings expectations (previous month: 30.8%), while 15.3% expect a deterioration (previous month: 17.2%). The sales climate index fell slightly from 110.5 in the previous month to 109.3 in October.
CURRENT TOPICS WITHIN THE TRANSPORTATION INDUSTRY IN GERMANY & EU
- Ryanair reduces flight offer in Germany: Following the previously announced partial withdrawal from the capital's BER airport, the low-cost airline Ryanair is now canceling further flight connections at German airports, including Hamburg Airport. Dortmund, Dresden and Leipzig airports will be completely removed from the route network. The reason given by Ryanair is the high cost of air transportation in Germany. The decision will reduce the airline's German flight offering by a further twelve percent. Eurowings CEO Jens Bischof also announced that it would be reducing its services in Hamburg.
- Germany loses important flight connections: Germany is facing a decline in important flight connections as aviation is only slowly recovering after the coronavirus pandemic. Compared to other European countries, Germany is well behind the level of 2019. Lufthansa CEO Carsten Spohr warns of further cancellations, especially for domestic German and European short-haul flights, due to increased taxes and fees. These increases, together with the obligation to use e-fuels, could cause ticket prices to rise further. The industry association BDL is calling for the revenue from the aviation tax to be invested in the promotion of alternative fuels. Additional factors such as the Ukraine conflict and difficulties at aircraft manufacturers are exacerbating the situation. The decline in business travel is adding to the uncertainty, as companies are increasingly relying on virtual conferences.
DESTINATION NEWS
- BERLIN: Berlin relies on a successful tourism concept to prevent overtourism. A central element is the promotion of lesser-known districts such as Reinickendorf and Lichtenberg in order to distribute visitor flows. The concept was developed in 2018 in response to the strong influx of tourists after 2012. Visit Berlin works closely with the districts and actively involves the population in the tourism strategy. Locals express their opinions through neighborhood workshops, surveys and a citizens' advisory council. Measures such as the ban on misappropriation have helped to reduce the number of Airbnb apartments. Overall, Berlin shows that tourism and the well-being of its residents can be reconciled. https://www.fvw.de/touristik/destination/tourismus-marketing-overtourism--das-macht-berlin-besser-246776
- MALLORCA: Palma de Mallorca has increased the budget for the city's tourism foundation by almost 300,000 euros to a total of 1.6 million euros. The aim is to promote tourism in the low season and to develop the US market more strongly. The funds are to be used for advertising campaigns, the tourism trade fair in Madrid and a study on cruise tourism. Criticism came from the opposition, which described the increase as unrealistic. They called for the money to be used for social housing instead. The city government defended the decision, arguing that the advertising was aimed at “desired tourists” in order to better manage tourism.
https://www.mallorcamagazin.com/nachrichten/lokales/2024/10/14/128183/mallorca-metropole-palma-erhohlt-budget-fur-tourismuswerbung.htmlMallorca is planning a new railroad line that will connect the airport with Palma de Mallorca and Llucmajor from 2032. The journey time between the airport and Palma will be just eleven minutes. Construction is due to start in four years and the project will cost around 690 million euros. Along the way, the train will stop at El Arenal, the new exhibition center, Son Llàtzer hospital and several other stops. The aim is to improve local public transport on the island and coordinate the route with buses.https://www.fvw.de/touristik/destination/vom-airport-nach-palma-mallorca-plant-bahnstrecke-zum-flughafen-246950
- BALEARIC AND CANARY ISLANDS: Despite discussions about overtourism, demand for the Balearic and Canary Islands remains high. In July and August 2024, over 600,000 Germans traveled to Mallorca, which is roughly equivalent to the population of a large city like Dortmund. TUI and other tour operators report a successful summer, with Mallorca remaining the most popular destination for TUI guests, closely followed by Antalya. The extended season in Majorca is having an effect, as hotels and restaurants are staying open longer. Dertour and other tour operators are reporting an increase compared to the previous year, and many hotels remain open well into November. Demand also remains high in winter, with Riu and Iberostar, for example, keeping some of their hotels open. Coral Travel/Ferien Touristik has expanded its portfolio for the winter and expects increased demand, also due to events such as the Starway Tourism Awards in Cala Ratjada at the end of October.
- CANADA: Canada wants to attract more travelers with four new tourism corridors. Destination Canada is planning cross-provincial routes such as the Cycle Ontario and Quebec corridor, which connects existing trails and promotes cycling tourism through services such as rental stations and accommodation. The Northern Sky corridor from Alberta to the Northwest Territories highlights Indigenous culture and nature experiences to meet the demand for northern Canadian travel. The Field to Fork Corridor in Saskatchewan and Manitoba promotes agritourism, while the cross-border Juan de Fuca Corridor connects British Columbia to Washington State. All corridors aim to promote sustainable tourism and local economic development.
https://www.reisevor9.de/destinations/kanada-entwickelt-neue-tourismus-korridore
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