Market Update – October 05, 2023

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 

• POPULAR DESTINATIONS REMAIN AFFORDABLE: Amidst a resurgence in travel post-pandemic, German holidaymakers are facing an average of 30% price increase compared to 2019, yet popular destinations remain reasonably affordable this fall, according to Holidaycheck. The analysis of package deals from 65 tour operators during September 1 to November 15, 2023, shows booking figures returning to pre-pandemic levels for October and November, despite the price hikes. While prices at popular destinations have remained relatively stable, families are experiencing an average 28% increase in costs. Some locales have surged about a third in price relative to 2019, though hopeful signs point towards falling prices in Mallorca, particularly in the off-peak season. Read more

 

• SUMMER 2023 EXCEEDS PRE-CORONA LEVEL: Despite rising Corona numbers, a positive trend is evident in the vacation business. By the end of August, there was a 15% increase in sales over last year. There is an increasing popularity of Eastern Mediterranean countries as destinations. Long-distance travel and cruises are approaching their previous levels. Sales growth is impacted by higher prices and vacation spending. Data from TDA shows that winter bookings are up 6% over the 2018/19 season, with the Canary Islands and Egypt dominating as main destinations and Turkey gaining in popularity. Read more

 

• DEMAND REMAINS HIGH – THE TRAVEL BUDGET ALSO: The majority of Swiss people plan to go on vacation or fly this fall without cutting their travel budget compared to last year, according to a survey by Kuoni. Popular destinations are cities, mountains and beaches. Last-minute deals in October are enticing, but for more flexibility and lower prices, travel in November is recommended. 42% of the Swiss population have already planned an autumn trip, 28% decide spontaneously, and only 31% definitely stay at home. Half of the travelers plan to spend roughly the same budget as last year, while a quarter each plan to spend more or less. Interestingly, city breaks are the most popular type of vacation, followed by mountains and beaches. Kuoni’s booking statistics show an increase in sales of about 15% over 2019 this fall season. There is still some availability for last-minute bookers, especially for cities such as Paris, Hamburg and Rome, as well as beaches in Egypt, Mauritius, Cyprus and the Maldives. Read more

 

• TREND RESEARCHER CALLS FOR STRONGER SPECIALIZATION ON BEST AGERS: Mathias Haas, a trend researcher, highlights the importance of the tourism industry catering to the diverse vacation preferences of individuals aged 50 and above, often referred to as „best agers.“ Rather than treating this demographic as a uniform group, Haas suggests that tour operators and travel agencies should recognize the significant variations in their needs. Tailored offerings that align with specific interests and life circumstances, such as sports, health, or wellness, could be advantageous. Furthermore, prioritizing comfort for older travelers is recommended. Haas also proposes that travel agencies establish distinct niches, possibly focusing on particular age groups. The utilization of digitization and AI can enhance the precision of customer profiling and enable more personalized travel offerings. Read more

 

• THESE DESTINATIONS ARE THE GERMANS MOST FAVORITE TO BOOK: According to an analysis by Check 24, a clear trend for package tours to Turkey and Spain is emerging in this year’s fall season. The Turkish regions of Side and Alanya are particularly popular with Germans, with the average cost of flights and hotels at 90 euros per day. Mallorca, often referred to as the Germans‘ „favorite island,“ follows in second place, albeit at a higher cost of 110 euros per day on average. Compared to the previous year, package tour prices to Majorca have risen by 18 percent, while Monastir in Tunisia has seen a smaller price increase of only three percent. Martin Zier, managing director of package tours at Check 24, stresses the importance of comparing prices and points out that destinations that offer summer temperatures in the fall are particularly in demand. Tunisia deserves a special mention, which has seen a significant increase in demand. In particular, Monastir has established itself in the top 15 package holiday destinations this year, whereas last year it was not even in the top 20. Other Tunisian destinations such as Hammamet and the island of Djerba are also in demand, with the latter even seven percent cheaper than last year. Read more

 

• TRAVEL THAT SWISS PEOPLE DESPERATELY WANT TO EXPERIENCE: A recent survey by Kuoni showed that the Aurora Borealis in the far north is at the top of the travel list for 72% of Swiss people. City breaks to metropolises such as New York and Paris and baths in Iceland’s hot springs follow close behind. While women are particularly attracted to nature, culture and luxury trips such as the Seychelles, men prefer road trips in the USA and Australia. Young people between 14 and 19 are particularly interested in metropolises, while older people over 50 prefer the Northern Lights. It is clear that travel preferences in Switzerland vary according to gender, age and region. Read more

 

• WORLD TOURISM DAY – SUSTAINABLE INVESTMENT IN FOCUS: The theme of sustainable investment to ensure the growth and transformation of the tourism sector took center stage at World Tourism Day in Riyadh on September 27. More than 50 tourism ministers and many delegates from the global tourism sector were hosted by the Kingdom of Saudi Arabia. UNWTO and the Saudi Tourism Minister emphasized the need for investments that benefit the people and the planet. The focus was on building resilience and sustainability in tourism, with investment playing a key role. On the occasion of the day, DRV highlighted the travel industry’s commitment to improving its environmental footprint and ensuring CO2-neutral mobility. It was also emphasized that sustainability does not only include the ecological aspect, but also social and economic aspects. Read more

 

CURRENT TOPICS WITHIN THE TRANSPORTATION INDUSTRY IN GERMANY & EUROPE

• WIZZ AIR’S STRATEGY TO DOMINATE EUROPE: Wizz Air, a significant player in Europe’s airline industry with 45 million passengers and an average of 900 flights daily, is set to expand its operations, particularly in Italy. The airline already boasts five operational bases in Italy and transported over 12 million passengers last year. Their strategy includes deploying the new Airbus A321 XI-Rs, with 47 of these 239-seater aircraft ordered for domestic and intra-European routes. While the airline has no plans to prioritize transatlantic journeys, they see growth potential in routes towards the Middle East, Asia, India, and Africa. The main objective remains strengthening its European operations, aiming to rival Ryanair, with growth centered on fleet expansion and workforce augmentation. Read more

 

• LÜBECK AIRPORT STOPS LINE FLIGHTS IN WINTER: The virtual airline Lübeck Air has decided to stop its flights this winter in order to have time for restructuring and business considerations. As a result, no passenger flights are likely to take off from Lübeck Airport this winter, as other airlines such as Sundair and Smartwings, which normally fly from there, could also be affected. One of the main reasons for the suspension of flight operations is the construction of a new tower at the airport, which is scheduled for completion next year. With this new tower and a so-called remote tower, the airport hopes to monitor flight operations over Lübeck and other northern German airports. However, Lübeck Airport will remain open and continue to handle private and business flights. Read more

 

• AIR FRANCE-KLM AND INVESTORS TAKE OVER SAS: A consortium consisting of Air France-KLM, investment firms Castlelake and Lind Invest, and the Danish state has successfully raised €1.1 billion to rescue insolvent airline SAS. Following this investment, Castlelake will own 32% of SAS, Lind 8.6%, the Danish state 25.8% and Air France-KLM 19.9%, with the remainder going to smaller investors. Air France-KLM’s entry signals an imminent move by SAS from the Star Alliance, of which it was one of the founding members, to the Sky Team, which is led by Air France-KLM. SAS, founded in 1946 by the merger of airlines from Denmark, Norway and Sweden, currently operates a fleet of about 100 aircraft. Read more

 

• AIRPORTS MUNICH AND FRANKFURT FALL BACK: Frankfurt and Munich international airports have dropped in position in a comparison of global hubs. According to the Official Airline Guide (OAG), Frankfurt fell from second place in 2019, before the Corona pandemic, to sixth, and Munich from fifth to 23rd. The German Air Transport Association (BDL) attributes this drop to high taxes, better working conditions at competing airports such as Istanbul and Dubai, and EU climate policies. Despite these changes, London-Heathrow was able to maintain its leading position worldwide. Other airports such as JFK in New York, Amsterdam, Kuala Lumpur and Tokyo-Haneda overtook Frankfurt. Julia Fohmann-Gerber, a spokeswoman for the BDL, pointed out that rising costs caused by Germany’s location, as well as the highest aviation tax in the EU, are affecting competitiveness. Competitors in Turkey and the Gulf states benefit from lower personnel costs and lack high CO2 taxes and regulations for renewable fuels. Read more

 

DESTINATION NEWS 

• AUSTRIA: The Austrian tourism sector saw slight growth in the summer, with overnight stays rising 3.6% year-on-year between May and August, Statistics Austria reported. In total, nearly 60 million overnight stays were recorded, 1.6% more than before the 2019 pandemic. Despite this upswing, August, a main travel month, recorded a 1.8% year-on-year decline. This was attributed to inflation, labor shortages and, in particular, severe weather and flooding. Carinthia, in particular, which was heavily affected by flooding, experienced a 7.9% decline. Bookings by German guests also fell by 5.9% in August, while demand from Switzerland and the Netherlands also declined.
• CARIBBEAN: The long-haul tourism industry to the Caribbean and Latin America is currently experiencing a strong comeback, with a particular focus on the luxury segment and the Lesser Antilles. Travelers are trending toward individual, authentic and luxurious experiences, with smaller accommodations and sustainability gaining in importance. In Latin America, Costa Rica and Ecuador are high on the list, whereas South America lags behind due to a lack of direct flights. However, Nicaragua is increasingly becoming an insider’s tip. Despite these positive trends, the lack of direct flights and significant increases in airfares are major obstacles for the industry. Although sales in some areas of the Caribbean exceed 2019 levels, the number of departures remains below. Increased costs are also affecting travel patterns: Many travelers are opting for shorter but higher-quality trips.
• COSTA RICA: More than 386,000 migrants have passed through Costa Rica since January, with many heading to the United States. Because of the massive influx, President Rodrigo Chaves plans to declare a state of emergency and release additional financial resources. In September, 60,000 migrants arrived in Paso Canoas alone. To facilitate passage, the government has established a transportation service to the Nicaraguan border. Migrants who cannot afford the $30 cost will be assisted by the emergency funds. Chaves also warned that disrespectful behavior could lead to deportations.
• CROATIA: In Croatia, prices for tourists have risen following the introduction of the euro, leading to complaints about expensive accommodation and restaurant prices. To address the problems of mass tourism, such as congested infrastructures and environmental pollution, the Croatian government plans to introduce a tourist tax. This tax will be levied especially in the most affected regions, such as the coasts and islands, and will finance environmental protection. The exact design and calculation of the tax is still pending, with its introduction not expected before 2025.
• CURACAO: In the 2023/24 winter season, Curaçao will expand its flight offerings with three airlines: Corendon, KLM and TUI. Corendon will start on November 3 with five flights weekly from Amsterdam. Despite the pandemic, the number of tourists in Curaçao is approaching a record of half a million. In addition, several hotels will open this winter, including the Marriott Courtyard in Willemstad and The Rif – Mangrove Beach. The Zoetry Spazio Cabins Resort is expanding its suite offerings.
• ESTONIA: In 2024, Tartu, an impressive city in Estonia, will be celebrated as the European Capital of Culture. The official opening will take place on January 26. Much of the main program is already available, and on October 19, more exciting events will be announced for visitors to experience in Tartu and South Estonia next year.
• HAWAII: West Maui’s iconic hotels are reopening despite concerns from locals displaced by August fires. While tourism is vital for Maui’s economy, leading to a $2.6 million campaign supporting local businesses, some residents fear it might hinder their return to homes. The Hawaii Tourism Authority ensures disaster survivors in hotels will not be affected. Hotels like the Four Seasons Resort Maui at Wailea are now open, with the Ritz-Carlton Kapalua reopening on October 8. Local businesses emphasize that tourism aids recovery, and several establishments have set up support initiatives for affected residents.
• MALTA: The European Union has refused further support payments for the loss-making airline Air Malta. As a result, the Maltese government has decided to dissolve Air Malta and replace it with a new company: KM Malta Airlines p.l.c. This airline, whose sole shareholder is the Maltese government, plans to begin operations on March 31, 2024, subject to approval by the Malta Aviation Directorate. The new airline will build on Air Malta’s strengths, with a particular focus on financial sustainability. 
• PERU: The Peruvian tourism authority, Promperú, clarifies that contrary to previous reports, no official announcement has yet been made regarding the closure of any part of the Inca citadel of Machu Picchu. If protective measures are taken, they will be temporary and taken in coordination with local and national stakeholders to preserve the cultural and natural heritage. Machu Picchu remains a safe and impressive place for visitors. The Peruvian government, in collaboration with the tourism sector, is constantly working to ensure the preservation and sustainable access to this wonder of the world.
• PORTUGAL: The Algarve in Portugal, a coastal region of about 200 kilometers, has won the World Travel Award as „Europe’s Best Beach Destination“. This is the tenth time that the Algarve has received this prestigious award, with this year’s ceremony taking place in Batumi, Georgia. Despite strong competition from destinations such as Mallorca, Marbella, Sardinia and Corfu, the Algarve came out on top.
• SAUDI-ARABIA: Saudia, Saudi Arabia’s national airline, has unveiled a comprehensive brand redesign in Jeddah that includes its new brand identity, livery and digital initiatives. The rebranding process, which features colors such as green, blue and sand, aims to enhance the customer experience through digital innovations and cultural appreciation. The new image also includes new uniforms, a custom scent, sound identity and locally inspired food. In addition, a generative AI called ‚Saudia‘ will be introduced to facilitate transactions for guests. Saudia Group’s director general highlighted the airline’s rapid development and Saudi Arabia’s ambitions to become a leader in the global aviation industry. The goal is to bring around 330 million visitors to the country by 2030.
• SOUTH AFRICA: South Africa’s tourism is booming, mainly due to a weaker rand. Markus Kohli of Knecht Reisen notes this trend, which is reinforced by the rand’s nearly 15 percent drop in value against the Swiss franc. This makes travel more affordable for Swiss. Other travel providers such as Dreamtime Travel and Private Safaris confirm the increasing demand, especially for safaris and road trips. Dominic Eckert of Dreamtime emphasizes that the destination and not only the exchange rate is decisive. Besides South Africa, other African destinations such as Tanzania and Botswana are also popular with Swiss travelers. Less in demand at present are Zimbabwe, Madagascar and Mozambique.
• SPAIN: Spain’s tourism industry has seen an increase in revenue despite a decrease in visitor numbers. There were 8.9 percent fewer German guests in 2023 compared to 2019, but spending increased by 5.5 percent. The focus is on quality over quantity. Turespaña director Alvaro Blanco stresses the importance of Spanish tourism infrastructure and lifestyle. Valencia, as an example, is trying to position itself as the „Copenhagen of the South“ and has seen an increase in German tourists in recent years. Discussions at a congress emphasized the importance of cultural tourism and the growing appeal of mainland Spain. Despite higher prices – the average price per person per night increased from 96 euros in 2019 to 122 euros in 2023 – experts advise against lowering prices. Spain’s focus should be on quality and low season, with the country seeing revenue growth of nine percent this year. 2023 is expected to be one of the best years in Spain’s tourism history, although Germany remains behind the UK as the main source market.
• TAIWAN: Tropical cyclone „Koinu“ hit Taiwan hard, knocking out power to 200,000 households. The storm brought heavy rains and winds that affected the entire country of more than 23 million people. It is the second typhoon to make landfall in Taiwan this year, with the south and offshore Lanyu Island hardest hit. Record-breaking wind speeds of 340 km/h were recorded on Lanyu. Over 1700 accidents were reported and more than 220 flights were cancelled. The typhoon, which originated in the Pacific Ocean, is now moving more slowly toward southern China, although Taiwan continues to expect impacts.

 

WHAT ELSE IS BREWING? 

Dive into this month’s exhilarating roundup of the best of European cycling, captivating road trips, and the world’s most extraordinary places to rest your head. 

The results are in, and it’s official: if you’re an avid cyclist, you might want to consider packing your bags for Copenhagen! Topping the charts in a recent study by ‚Casino.ch‘ as Europe’s most bike-friendly city, it seems the Danes really have got the cycling thing down. And if you’re looking for alternatives, Bern and Rome are pedaling hard to keep up. A word of caution for our friends in Graz and Munich, though – perhaps take a helmet (or two).

It seems not all souvenirs are created equal. One Belgian couple’s rock collection turned a bit more historic than expected, landing them in a tight spot with Turkish customs. A reminder to all of us that sometimes, memories are the best keepsakes.

Considering a road trip? ‚Finn‘ has you covered with their comprehensive European guide. Croatia is the new darling for road warriors, while Slovenia might be the best-kept secret of the lot. However, electric car enthusiasts might need to do a bit more homework when heading to Portugal, Spain, or France. Remember, it’s the journey, not the destination (but good roads and e-charging stations sure do help).

Experience a journey beyond the ordinary with global overnight wonders that redefine the art of lodging! Dive 419 meters beneath the earth’s surface in Wales‘ Deep Sleep Hotel, soar amidst Peruvian peaks in the Skylodge Adventure Suites, and drift surrounded by marine serenity at the Maldives‘ Conrad Resort. Marvel under the shimmering dance of Finland’s northern lights at Kakslauttanen Arctic Resort, bask in desert decadence at Abu Dhabi’s Qasr Al Sarab, or indulge in the minimalist charm of Germany’s Trafo Haus. Walk into the quirky realm of Pennsylvania’s Haines Shoe House and finally, encapsulate the essence of high-flying dreams, grounded at Sweden’s Jumbostay Hotel. Every stop is an invitation to redefine the art of lodging!

Stay adventurous, stay curious, and most importantly, keep exploring!

 

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