So bad were the numbers from the monthly report on January booking activity at German travel agencies that the trade publication, FVW, screamed “Summer bookings turn deep-red” and said that “January was a catastrophe” for holiday bookings on the German market.
While expressing the hope that summer season can be saved, the article pointed out that in January—it is normally the strongest month for summer holiday bookings—there was a 12 percent, year-on-year decline in sales, according to the monthly Travel Insights survey conducted by the Nuremburg-based research company, GfK, which analyzes approximately 340,000 bookings made at 1,200 German travel agencies.
The decline in activity, said FVW, represents €260 million ($289 million) less in revenues for tour operators and travel agents than in January 2015. The fall-off follows an 8 percent drop in December and confirmed accounts received by FVW, and the Inbound Report, from tour operators and travel agents in recent weeks about the decline in demand following terror attacks in major travel destinations (in particular, the Jan. 12 suicide bombing in Istanbul’s historic Sultanahmet Square that killed 10 German tourists), causing travelers to put off bookings due to fears about safety and security.
Sales for the upcoming Summer 2016 travel season are now 8.6 percent behind last year on a cumulative basis and all months are showing negative trends, the GfK survey showed. This includes a 22 percent drop in August compared to the same time last year. January demand for winter holidays was also weak; there as a 12 percent drop in sales vs. January 2014, resulting in cumulative growth of just 1.7 percent for the winter 2015/16 season.
GfK did report, however, on some positive signs: Last month travel agencies reached 40 percent of the previous year’s total summer season revenues, just three percentage points lower than the figure achieved in January 2015. And current summer season sales volumes are still higher than at the same time two years ago, the market researchers pointed out.
If “German holidaymakers abandon their current caution with bookings … the losses can still be compensated or at least reduced,” said the GfK report. Also:
—German travel agents remain cautious about sales prospects for the coming months.
—Many agents, as many as 40 percent, had lower revenues in the last 2-3 months
—Only 27 percent reported increased sales, according to the latest monthly FVW “sales climate index.”
—One third of agencies described the current sales situation as “good,” nearly half as “satisfactory” and the rest as “bad.”
—Looking ahead, an optimistic 22 percent of agents surveyed expect sales to improve in the coming months while 53 percent expect stable demand.
Following up on last week’s Inbound Report article that asked the question, “Will Germans Switch, Visit USA, Instead of Turkey this Summer?” FTI said that it has launched a new its first “USA apartments and holiday homes” brochure, mostly with properties in Florida. But the program was already established prior to the terrorist attack in Turkey. (See https://www.inboundreport.com/wp-admin/post.php?post=5393&action=edit)