Market Update – July 28, 2022

Market Update – July 28, 2022

Market Update – July 28, 2022 820 312 fame creative lab

Please note: the following information has been compiled from the most important German-speaking Trade Media.

Current major topics within the tourism industry in the DACH region

  • Consumers save on food, but not yet on travel: According to the Deutsche Presse-Agentur, based on information from GfK, articles for daily consumption recorded a sharp decline from January to May. For example, 8.2 percent less meat and sausage products, 8.5 percent less fresh fruit or vegetables and seven percent less baked goods were purchased.Not only is less being bought, but people are also turning more frequently to special offers or manufacturers‘ own brands, according to GfK. The share of private labels in total sales grew by 35 percent in the first quarter. For more than a third of people, price is currently the most important criterion when making a purchase decision.The travel industry, on the other hand, has so far developed in a completely different way. After more than two years of the Corona pandemic, consumers have a lot of catching up to do. The booking figures for private vacation trips in the current summer season are comparable to the last pre-pandemic year 2019, in some cases even exceeding it. Read more.


  • Gebeco-Rising demand for special groups: The Corona pandemic has changed the travel behavior of Germans. According to study tour operator Gebeco, this can be seen, among other things, in the sharp rise in demand for closed-group travel.“The need to travel in a group of familiar people who come from the same region and with whom you can now finally spend time together again has risen sharply,“ explains Melanie Unger, Team Leader Gebeco Sales. But also the desire for more individuality had become larger. The trend is now also benefiting travel agencies. Because Gebeco special groups count as reported to the TUI stars and bring thus up to two per cent commission on top. TUI Stars are dynamic travel packages. They are marked accordingly in Iris Plus depending on occupancy, risk and margin. But according to Unger, this is not the only reason why selling special group tours is worthwhile. They are the „ideal way“ to win new regular customers and to intensify and maintain existing customer relationships, says the sales expert. Gebeco offers in the current special group catalog and on the Website more than 170 worked out best-seller journeys for closed groups, for which a fast conversion is guaranteed according to Unger. The trips can also be individually adapted to the participants. Read more.


  • This is how the DER Touristik customers think in 2022: A clear trend among DER Touristik’s customers: this summer, vacationers are spending 51 percent more on their hotel than before Corona. One form of catering is also increasing rapidly, booking data from the Group’s tour operators show. This summer, the higher star categories are particularly popular with DER customers: more than half (2019: 47 percent) book four-star accommodation, and one in five (13 percent) choose five stars. The proportion of customers opting for three stars fell from 40 percent before the pandemic to 28 percent currently. This is according to booking data from the Dertour, Jahn Reisen, ITS, Meiers Weltreisen and Travelix brands. According to Ingo Burmester, CEO DER Touristik Central Europe, the „Dertour Travel Barometer Summer 2022“ also shows that „incoming bookings in recent months have been far above the level before the pandemic. Sales in summer 2022 at our tour operators are also above those of summer 2019.“  Read more.


  • „The era of the cheap vacation is over!“: For the 2023 summer season, vacationers in Southern Europe will have to prepare themselves for noticeably higher prices. Tough negotiations are likely to take place soon between tour operators and the hotel industry. In the southern European tourism industry, 400,000 vacancies need to be filled. Hotel owners on Portugal’s Algarve coast told the Financial Times that a shortage of staff had forced them to turn down wedding and christening parties, suspend beach shuttles and spa massages for guests, and shorten the opening hours of bars and restaurants.Cristina Siza Vieiram, vice president of the Associação da Hotelaria de Portugal (AHP), looking to the future, stated, „The era of the fast, frequent and cheap vacation is over!“ Inmaculada Benito, tourism director of the Spanish Confederation of Business Organizations (CEOE), is optimistic, at least for the current summer season. 

“The desire to travel is high and tourists are not too worried about prices. This helps reduce the impact of staffing shortages on sales. But service cuts usually lead to lower prices,“ Benito explains. The dilemma facing southern Europe can be illustrated by the example of Greece. George Valsamis, managing director of Secret Hotels on Santorini literally said, „What we are experiencing [in relation to staff shortages] is a consequence of overtourism. The Greek islands are not able to cater to so many people,“ he said. More than 50,000 of the 250,000 positions needed to staff the country’s hotels remain unfilled, according to the Greek Tourism Federation. Read more.


  • Positive Half-Year Results of Statistics for Austria: In the first half of 2022, overnight stays totaled 62.5 million, only 18.1 percent below the pre-pandemic level. This year, lodging establishments recorded around 19.2 million overnight stays from May to June, according to preliminary data released by Statistics Austria today, Wednesday. According to the data, this was only 4.5% less than in the same period of 2019 (20.1 million) and was only slightly below the level of 2018 (19.3 million). „Thus, this year’s summer pre-season has already almost reached again the overnight stays records of May/June 2019 and 2018“,confirmed Statistics Austria Director General Tobias Thomas. This year, the first third of the summer half-year was the third strongest since records began. The number of overnight stays by guests from within Austria increased by 6.5% to 7.2 million compared to the pre-Corona level of 2019, representing a 37.6% share of total bookings. Bookings from abroad decreased by 10.1% to 11.95 million over the two-year period, with the month of June alone accounting for the bulk of bookings at 12 million overnight stays. This was 60.6% more than in June 2021 and already almost as many as in June 2019, i.e. before Corona, with 12.6 million overnight stays.In all provinces except Lower Austria, there were increases in overnight stays by domestic guests at the start of the season this year compared to 2019. At the same time, bookings by foreign holidaymakers declined everywhere except in Vorarlberg. Between January and June 2019, around 76.4 million nights had been booked, while the first half of 2021 recorded the lowest number of overnight stays since records began, at 14.1 million. Read more.


  • Majority of travel professionals fly on summer vacation: This year, it is finally possible to travel again practically without Corona restrictions. Now the summer vacations are coming up and the travel boom is causing one or the other problem. Airlines have too few staff and cancel various flights. There is chaos at various European airports and delays and long waiting times have to be expected. However, this does not seem to be keeping customers from traveling during the summer vacations. The tour operators of Switzerland rave about numbers partly over pre-Corona. As it turns out, however, the majority of travel professionals want to go on vacation this summer. 41% are traveling to a short- or medium-haul destination, 19% to a neighboring country and 10% are even going further afield. 13% are vacationing in Switzerland and only 17% will not be traveling this summer.The majority of travel professionals will travel by plane this summer, despite the flight chaos. 59% will take the plane, 28% the car, 12% the train and 1% the bus or car. Read more.


Current topics within the transportation industry in Germany and Europe

  • The Verdi Union launches warning strike at Lufthansa: The Verdi trade union has largely paralyzed Lufthansa’s flight operations with a warning strike by ground staff. The strike began early Wednesday morning, as strike leader Marvin Reschinsky told dpa. Lufthansa has canceled more than 1,000 flights at its Frankfurt and Munich hubs as a precaution and fears repercussions until Friday, the last day of school before the summer vacations in Bavaria. 134,000 passengers had to change their travel plans or cancel them altogether. At least 47 connections had already been canceled on Tuesday. Lufthansa advised affected air travelers not to come to the airports because most of the counters there were not manned anyway. Already in previous labor disputes, the terminals had remained largely empty on the day of the strike itself. According to Verdi, various Lufthansa companies at the hubs in Frankfurt and Munich, as well as in Berlin, Bremen, Düsseldorf, Hamburg, Hanover, Cologne and Stuttgart are on strike since 3:45 a.m. on Wednesday. Very different groups of employees are called up, such as counter staff, aircraft technicians and the drivers of the giant tugs that move aircraft to the right positions at the airport. The walkout is expected to last until 6 a.m. Thursday. Verdi has called for rallies at Frankfurt, Hamburg and Munich airports. Read more.


  • Aviation needs 2.1 million new employees: Despite rising jet fuel prices, Boeing expects to expand its global commercial fleet. China, Europe and North America are expected to need a particularly large number of new pilots by 2041. A detailed overview. According to aircraft manufacturer Boeing’s latest Pilot and Technician Outlook (PTO), there will be a need for 2.1 million aviation workers by 2041 to support the recovery of commercial aviation and meet rising long-term growth. Specifically, 602,000 pilots, 610,000 maintenance technicians and 899,000 cabin crew members will be needed to support commercial aviation over the next two decades. According to Boeing’s recently released Commercial Market Outlook (CMO), the global fleet is expected to nearly double by 2041, growing to 47,080 aircraft. Read more.


  • Strike brings Britain’s rail traffic to a standstill: With a major strike on British railroads, thousands of employees are demanding higher wages and more job security. As a result, there will be major disruptions across the country in the UK today, Wednesday. Only about one train in five will be able to run, and in some areas all services will be cancelled. Transport Minister Grant Shapps refused to act as a mediator and sided with the employers. The strike is also likely to affect visitors to the Commonwealth Games, scheduled to begin Thursday in Birmingham, as well as spectators at Wednesday night’s match between Germany and France in the semifinals of the European Women’s Soccer Championship. Read more.


  • Giant revenue loss in Russia: The Russian aviation industry will lose 19 million passengers this year alone due to the flight bans imposed by Moscow in southern Russia in the wake of the Ukraine war. This is about one-fifth of the planned total transport figures, reported the business newspaper „Vedomosti“, citing the Ministry of Transport. Read more.


  • Spanish Ryanair staff extend regular strikes until January: The flight attendants of the low-cost airline Ryanair in Spain intend to continue their strikes, which began at the end of June, until January. Since Ryanair „has not made the slightest attempt“ to approach the unions, there will be regular 24-hour work stoppages until January 7, the unions USO and SITCPLA announced Wednesday. Accordingly, the next such action is planned for August 8. The workers are demanding better working conditions for the 1900 cabin crew employees in Spain.  Read more.


Destination news

  • Canada: The major North American travel destination has announced that as of yesterday, July 19, 2022, mandatory random testing for persons entering Canada by air, which was first suspended on June 11, 2022, will be reinstated. These tests, he said, are an important part of Canada’s surveillance program to track the importation of Covid19 virus into Canada and identify new variants of concern. Specifically, then, travelers arriving at Canada’s four major airports – Vancouver, Calgary, Montreal and Toronto – will be randomly tested. Read more.


  • Austria: In Germany, this is still under discussion, but Austria is already implementing it: Those who are infected with corona no longer have to isolate themselves. Infections will have to be accepted in the future, they say. Read more.


  • Greece: The Greek shipping company Anek Lines has launched new routes to the Cyclades and Dodecanese islands. The 142.50 meter long ferry „Prevelis“ connects Piraeus on the mainland with the ports of Milos, Santorini, Anafi, Kasos, Karpathos, Heraklion, Sitia, Rhodes and Halki. Read more.


  • Brazil: International tourist arrivals are picking up, with the first five months of 2022 breaking through the one million visitor mark – the first time since 2020. The number of flight connections is also on the rise again: Brazil’s international air network also grew significantly in May 2022, now equivalent to 74.36 percent of 2019 capacity, and according to the National Civil Aviation Agency, capacity actually increased by 312.9% compared to the same month in 2021. Embratur has invested in promotional initiatives for Brazil in strategic markets worldwide.These include international press trips, participation in trade fairs, the organization of roadshows, and famtrips for travel agents and tourist associations and partners. Plus, at least five advertising campaigns have been planned for 2022.  Read more.


  • Philippines: The Philippines have experienced one of the worst earthquakes in years. Many buildings and bridges are damaged, some areas without electricity. The earth tremors were felt even in Manila, hundreds of kilometers away. Read more.


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