Market Update – 12.10.23

CURRENT MAJOR TOPICS WITHIN THE TOURISM INDUSTRY IN THE DACH REGION

• GLOBAL HOSPITALITY INDUSTRY GROWS TWICE: Global hotel occupancy through the end of August 2023 was 10% above 2022 levels, with fourth-quarter reservations 11% higher than a year earlier. Average revenue per available room is up 17% globally in 2023, with France leading the way with 123% growth. Europe takes the lead in the hotel sector, overtaking the U.S. in occupancy for the first time in 2023. Major events, such as Beyoncé’s tour and the Rugby World Cup in France, are having a significant impact on hotel occupancy. Amadeus data shows that alternative accommodations are booked an average of 31 days before travel, which helps hoteliers adjust their strategies accordingly. Read more‍

• CRUISE FLOWS TRAVEL AGENCY SALES: In September 2023, the German travel agency market is showing positive recovery trends compared to the pre-Corona figures of 2019. According to Tats-Reisebüro-Spiegel, total sales increased by 15.0 percent compared to September 2019. While tourist sales grew 9 percent, cruises saw a 15.7 percent increase and air travel 17.7 percent. Other services such as rail travel, car rentals and events increased 18.5 percent, although overall ticket sales declined 8.2 percent. Year-to-date 2023 cumulative sales are 13.4 percent above 2019, and September backlogs for future travel are 9.9 percent above 2019 levels, indicating growing confidence in travel. Cruises are showing a particularly strong rebound, up 68.9 percent from 2019. Read more

• HOTEL RATES CONTINUE TO RISE IN 2024: In 2024, hotel prices worldwide, including Germany and Switzerland, will increase, according to a forecast by the consulting arm of American Global Business Travel (Amex GBT). This trend already follows significant price increases in 2022 and 2023, driven by pent-up demand for vacation and leisure travel. In Germany, Berlin is expected to see the largest increase, up 9.4%, followed by Munich, Düsseldorf, Frankfurt and Hamburg. In Switzerland, Amex GBT forecasts increases of 5% and 4% for Geneva and Zurich, respectively. Price increases are also expected in cities such as London, Paris and New York. Nevertheless, Amex GBT believes that due to declining growth in leisure travel, companies could negotiate better hotel deals to partially offset the price increases. Read more

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CURRENT TOPICS WITHIN THE TRANSPORTATION INDUSTRY IN GERMANY & EUROPE

• AIR TRAFFIC RECOVERY IN GERMANY TAKES TIME: Air traffic in Germany has reached only 77% of pre-Corona levels by August, according to figures from the airports association ADV. Although passenger numbers for European flights and intercontinental traffic are close to pre-crisis levels, the rate for domestic German flights is only 48%. Declining domestic German flight numbers are mainly attributed to environmental debates and the reluctance of business travelers. A return to the old level seems unlikely. Read more
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• ABOUT ONE-THIRD OF FLIGHTS IN EUROPE UNPUNCTUAL: In the summer months of June to August, 66% of flights in Europe were on time. Extreme weather in July was the main reason for delays, with two and a half times more weather-related delays in that month than the previous year. After the Corona pandemic, high demand for flights had pushed airports to their limits, and there were staff shortages as many employees moved to other industries. Despite this, on-time departures at Germany’s ten busiest airports in the summer of 2023 increased by 8% year-on-year. Delays can be caused by weather, technical problems, baggage regulations or strikes. Airlines plan their flight schedules well in advance and take potential causes of delays into account. Buffer times and additional staff have been deployed to improve punctuality. Read more

• AIRPORTS PROGNOSE MORE PASSENGERS FOR 2024: European airports are forecasting higher passenger numbers next year than before the corona pandemic. Despite an 11.6% increase in passenger numbers in August, industry body ACI has raised its forecast for next year, with expectations of 1.4% above 2019 levels. However, there are differences between airports; only about half have already reached pre-crisis levels. Istanbul surpassed pre-crisis levels in August, with a 12.6% increase, partly due to Turkish Airlines‘ expansion. In contrast, Frankfurt is far behind pre-crisis levels with a 15.3% decline, the largest difference among Europe’s top 5 airports. Some smaller airports experienced significant expansion by direct carriers, while Germany saw reductions. Read more

• TRAVEL BUS INDUSTRY STILL IN THE „CORONA CRISIS“: In 2022, the travel bus sector in Germany recorded a significant decrease in passenger numbers compared to 2019, with a decrease of 52%. Despite this decline, there was an increase of 104% compared to 2021. The number of companies in the coach sector also decreased. Christiane Leonard of the German Bus Operators Association stressed the need for political support and called for a reduction in VAT for coach travel. The bus utilization rate in 2022 was close to the 2019 level, while total bus mileage was more than halved. Read more

• TURKISH AIRLINES WITH JUST UNDER 8 MIO. PAX IN SEPTEMBER: In September 2023, Turkish Airlines carried 7.9 million passengers, an increase of 9.2% year-on-year. The ‚load factor‘ was 84.6% for international flights and 87.3% for domestic flights. The number of international passengers increased to 2.7 million, and available seat kilometers increased by 8.9%. In the first three quarters of 2023, a total of 63.9 million passengers were carried, with international passenger traffic increasing by 31.2% to 22.4 million. At the end of September 2023, Turkish Airlines‘ fleet size was 429 aircraft. Read more

• FURTHER FALLING PRICES AND INCREASING BOOKINGS: In September 2023, the cost per car rental booking reached its lowest level of the year at an average of EUR 383, a drop of more than EUR 100 compared with June 2023. In parallel, car rental operator Sunny Cars continued its market success, posting a record September. As many reservations were made as last in the spring. Spain remains the top destination for rental car vacations, followed by Portugal, which proved much more popular in early fall and took second place. Italy, Greece and the USA rounded out the list of top destinations. Sunny Cars‘ Managing Director Thorsten Lehmann emphasized the strength of September and was pleased with the company’s success in the car rental market. Read more
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• FAVORABLE LUFTHANSA FARES NO LONGER SUBMITTABLE: Starting October 10, 2023, Lufthansa will eliminate the rebooking option for the low-cost Economy Light and Business Saver fares, making these fares completely inflexible. This move is intended to create a clearer distinction between these and other fare options. Those who want more flexibility in rebooking in the future will have to switch to other fares. For bookings already made on these rates, rebooking will remain possible for a fee. However, for rebookings made after October 10, the new rate conditions will apply. Read more

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DESTINATION NEWS

• AUSTRIA: Skiing vacations in Austria will become significantly more expensive in the next winter season. According to a report by APA, lift ticket prices will rise by an average of 7-10%. Especially in Tyrol and Salzburg price increases are to be expected. At the Arlberg in Tyrol, for example, the price of a day ticket will rise by 12% to 75 euros. The reasons given for the price increases are inflation, higher energy prices and interest rates, and increased standard wages for cable car employees.
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• DENVER: Denver International Airport is planning a significant expansion to accommodate growing passenger numbers. In 2022, the airport served 69 million travelers, making it temporarily the third busiest airport in the world. This year, the number is expected to increase to 78 million passengers, and by 2045, the airport forecasts 120 million travelers. To accommodate this growth, the airport announced the construction of four new gates with a total of 100 additional gates, all of which will be directly connected to the central Jeppesen Terminal and within walking distance. Although no exact construction schedule is available, the expansion will be phased in, and existing facilities will be upgraded in parallel. Flights to Denver are currently operated by Lufthansa and United from Germany and Edelweiss from Switzerland.
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• DOMINICAN REPUBLIC: The Dominican Republic is ramping up its efforts to position itself as a leading sustainable luxury travel destination in the Caribbean. This follows the trend toward luxury travel with a focus on sustainability. Of the German tourists who visited the country in 2022, about 30% chose premium sustainable offerings. In response, the country is focusing on building sustainable luxury resorts in the Samana, Pedernales and Miches regions. A key project is a new resort in Bahia de las Aguilas, which is being developed in a public-private partnership with an investment of up to US$800 million in the first phase. In Miches, another luxury project is under construction with an investment of US$735 million. The municipality of Samana is a pioneer in sustainability, with the recently opened Cayo Levantado Resort standing out with various sustainable initiatives.
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• ISRAEL: Following the Hamas rocket attack on Israel, in which Tel Aviv was targeted, the German Foreign Office has issued an urgent warning against travel to Israel and the Palestinian territories. Lufthansa and other airlines have suspended or canceled their flights to Tel Aviv, and tour operators such as Studiosus have also canceled trips to the region. The attacks have resulted in numerous deaths on both sides, and there are fears of an escalation of the situation. The German Foreign Office advises Germans staying in Israel to register.
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• JORDAN: Dr. Abed al Razzaq Arabiyat, Managing Director of the Jordan Tourism Board, stressed in a statement in light of recent developments in the Gaza Strip that Jordan remains a safe and hospitable destination. The country is proud of its reputation and is committed to ensuring that visitors can safely explore its culture, landscapes and cities. Despite global tensions, Arabiyat believes in the unifying power of travel and invites tourists to discover the beauty and tradition of Jordan. The Jordan Tourist Board stands ready to assist tourists and ensure that their stay in Jordan is both enriching and safe.
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• MEXICO: Yucatán, a state in Mexico known for its historical and cultural heritage, wants to attract more overnight visitors instead of just day visitors. Currently, most tourists move to tourist centers such as Cancún or Tulum for overnight stays. Yucatán plans to change that by focusing on culture and cuisine. At a roadshow in Europe, including Berlin and Frankfurt, Tourism Minister Michelle Fridman highlighted Yucatán’s advantages, from historic Mayan sites to beautiful beaches. New hotels are also being built, especially in the capital city of Merida. The goal is for visitors to stay longer in Yucatán.
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• TENERIFFA: Forest fires have broken out again in Tenerife, reigniting the large fire that was contained in August. The hot weather and weak winds may have contributed. Although the current fires are less devastating than those in August, which destroyed 15,000 hectares, they are still of concern and have already affected 30 hectares of forest. 152 emergency personnel, including firefighters and personnel from neighboring islands, have been deployed, supported by local police officers and volunteers. Initially, 2,600 people were evacuated, but there have been no further evacuations and residents are beginning to return home. Normal life continues in unaffected areas.
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• RUANDA: With five new entries, the African continent now has a total of 100 World Heritage Sites on the UNESCO list. One of these new heritage sites is Nyungwe Rainforest National Park in Rwanda, which is not only Rwanda’s first natural World Heritage Site, but also an important ecosystem for the region. Despite growth, African World Heritage sites represent only 9% of the global list. Therefore, UNESCO has adopted a strategy to increase the number of African World Heritage Sites, contributing to both conservation and economic development through tourism. Nyungwe National Park, declared a protected area in 1933, covers 100,000 hectares and is home to a variety of animal and plant species, many of which are endemic.
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• UKRAINE: In Ukraine, which has been experiencing war since February, about two million people traveled in 2022. This number is composed not only of journalists and aid workers, but also tourists. Despite the war, travel to Ukraine is possible without restrictions. The country’s government had even envisaged a war tourism program, but it was not implemented due to criticism. Despite the controversial opinions on war tourism, the Ukrainian tourism industry hopes for a prosperous future after the war, as about 14 million tourists visited the country annually before the pandemic. A post-war memorandum has already been signed between Airbnb and the Ukrainian Tourism Agency.
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• USA: New York has a new attraction: Manhattan’s first beach on the Gansevoort Peninsula in Hudson River Park. Despite its proximity to highlights such as the Whitney Museum and High Line Park, the beach has one major drawback: swimming in the Hudson River is prohibited for safety reasons. While locals and tourists can enjoy the 1,200 tons of sand, lounge chairs and umbrellas, officials make sure no one goes in the water. Although the opening was delayed until the end of the summer due to construction delays, the beach was well attended on opening day, October 3.

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WHAT ELSE IS BREWING?

Greetings, Jetsetters! Dive into this week’s dose of travel delights, from cruise aficionados to global shopping sprees. Buckle up; we’re taking you around the world in a few minutes!

Marty and Jess Ansen from Australia are giving a new meaning to „sea legs“! They’ve been onboard the Coral Princess for a whopping 450 days and have already charted 51 cruises consecutively. Why? It’s swankier (and apparently cheaper!) than a retirement home. More fabulous dinners, shows, and dances on the horizon, as they plan to hop over to the Crown Princess in 8 months!

The „100/200 Kitchen“, a starred restaurant in Hamburg, is making waves with its 35 euro „coperto“-style cover charge. A nod to the Italian custom, this ensures you have a plate (and bread to munch on). Planning on a feast? Their special menus range between 150 and 230 euros. Tips? Well, that’s still a bit murky!

The World Travel & Tourism Council reveals shopping tourism is seeing a global surge. Germany’s got the bling, attracting luxury shoppers, but those Sunday closed signs? They’re a bit of a buzzkill. Here’s hoping for more open Sundays!

Over-tourism is real, folks! Recent rankings point to packed places, with Thai destinations like Krabi, Pattaya, and Phuket topping the charts. Seeking less crowded European spots? Maybe skip Muğla, Hurghada, and even Venice. But if you’re in Germany, Frankfurt, Munich, and Berlin are bustling. And Rio? Well, it’s the spot for space, with just 0.2 tourists per resident. A breather!

Singapore’s Changi Airport nabs the crown for the twelfth year, boasting that iconic indoor waterfall. Hot on its heels are Doha’s modern Hamad International Airport and Tokyo’s pristine Haneda Airport. Whether it’s the relaxation spots in Seoul’s Incheon Airport or the exceptional service in Munich, these international terminals are not just transit points – they’re experiences in themselves!

That’s a wrap for this week! Whether you’re planning your next big adventure or just daydreaming at your desk, remember: every corner of the world has a story. Stay curious, and see you in the next edition! Safe travels and dreamy destinations.