“Static” is the word that best describes the character of the German outbound travel market—based on the revelations contained in the new dossier report of the German travel trade publication FVW. There have been some changes of note in the Nov. 1, 2014-to-Oct. 31, 2015 business year that show change, but little from the perspective of the Inbound Report that would give encouragement to U.S. travel suppliers hoping for more significant growth in the market. (It should be noted that the last long-term forecast for inbound travel to the USA issued by the U.S. National Travel and Tourism Office projected that visitor traffic to the United States from Germany would increase by a modest 2 percent.)
For instance, the 56 operators who participated in this year’s FVW dossier increased revenues by 4.2 percent to €21.2 billion ($23 billion) while their customer volumes rose by 2.2 percent to 32.7 million. The 56 companies are estimated to cover about 80 percent of the total German market.
Is the U.S. a Luxury Destination and, if so, Immune from Currency Fluctuations? Many in the industry had been anxious to see the results of the FVW dossier to see just what impact the decline of the euro vs. the U.S. dollar has had on business. Clearly, it could have been worse. In the one-year period used to measure the industry, the euro went from a high of $1.25 to $1.10. This is within the much larger slide from the high and low points of the euro vs. the dollar in 2014-2015: from a high near $1.40 to a low of $1.06—a decline of 24 percent. The euro, it seems, has stabilized—albeit at a lower level.
The dossier data seem to lend credence to the contention of Peter van Berkel, president of Travalco, a Miami-based receptive tour operator familiar with the German market, who told delegates at the NAJ Group’s recent NAJ RTO Summit in Orlando that receptives should recognize that the U.S. is not a budget or economy product for German consumers most affected by the weaker euro, but is a luxury product. Indeed, FVW reported that for long-haul holidays, there was a 6.9 percent increase in sales. “This higher growth for more expensive holidays,” it said, “(and) explains why tour operator revenues grew by two percentage points more than customer numbers.”
Plus ça change, plus c’est la même chose: Meanwhile, the ranking of the market leaders among German tour operators—though some share figures changed by percentage fractions from the last dossier ranking—remains the same as it was in the previous dossier report. The top four companies (TUI Germany, Thomas Cook Germany, DER Touristik and FTI) have half the market.
Top German Operators
|Operator & Rank||Share of Total Market|
|1. TUI Germany||16.5%|
|2. Thomas Cook Germany||12.9%|
|3. DER Touristik||11.4%|
|6. Aida Cruises||5%|
| TUI Cruises/Hapag-Lloyd Cruises have an another 3.3% of overall share.|
|Source: FVW dossier|