● Mood is Upbeat, even if most of the activity is in the retail channel. The point is: Germans want to travel—now! The setting, the attitude and the outlook is best summed up in an item from FVW / TravelTalk by its editor-in-chief, Holger Jacobs: “The upturn continues: After months of doom and gloom, the easing of travel restrictions and proceeding vaccinations have significantly lifted the mood in German travel agencies in June. The sales situation has improved considerably while future expectations even reached a record high.”
● The Numbers Reflect an Upswing: According to the consulting agency Dr. Fried & Partner, travel agent expectations (“Erwartung”) for the next six months reached an index level of 134 in June. This increase passed 100 in May and reached its highest level since the index was launched in 2005.
—The percentage of respondents who expect demand for travel services to increase in the next six months had already more than doubled from 21.4 percent in April to 45.9 percent in May, rose to 78.9 percent this month.
—The upswing is also reflected in the improved assessment of future earnings –
Although the change in the anticipated amount of earnings is not great, more than half of all agents (54.2 percent vs. 31.5 in May) expect an improvement within the next six months.
—Travel industry market researchers Travel Data + Analysis tells us that bookings started rising week by week during May, and even exceeded the pre-corona levels of May 2019 in the third week of the month. This indicates a real boom in the last few weeks. As of end-April, bookings for summer 2021 had been 11 percent below the level of last year and a massive 82 percent behind April 2019.
● Thumbs up at TUI: Summer business is picking up significantly at TUI, Germany’s largest tour operator. The trade publication Touristik Aktuell says that “the easing of travel in Europe and the cancellation of the general travel warning for corona risk areas with incidence values below 200 worldwide, announced for July 1st, are causing an extreme catch-up effect.”
“The race to catch up for the summer vacation is in full swing, and the consumer mood for travel seems to be increasing every day,” said Marek Andryszak, CEO of TUI Germany during a media call last week. “We have had strong booking weeks, which since May have even topped the level of the comparative weeks of 2019.” The most popular holiday destinations were even up by a double-digit percentage
Mallorca leads TUI’s top ten for the summer: While hardly a long-haul destination, Mallorca, off the eastern coast of Spain, ranks Number 1 in a ranking of top destinations for TUI customers. The top ten looks like this: #1 Mallorca; #2: Crete; #3 Antalya; #4 Rhodes; #5 Kos; #6 Fuerteventura; #7 Gran Canaria; #8 Tenerife; #9 Mecklenburg-Western Pomerania; #10 Ibiza.
TUI officials said that its revitalized package tour holiday form currently accounts for 70 percent of total demand at TUI, noting that this trend is favored by the strong customer demand for security and flexibility. According to Hubert Kluske, head of sales, said that more than half of TUI customers now opt for the Flex tariff, which the tour operator introduced as a novelty for global package tours during the COVID-19 crisis. This allows a customer to rebook and cancel free of charge up to 14 days before arrival.
Customers want help: The need for advice—from customers and travel agencies—is currently “extremely high” at TUI. This leads to poor availability, it was explained and, therefore, too much resentment among sales partners. Kluske said that he was aware that their expectations of TUI’s service quality. are different from what TUI is currently able to provide. To improve the situation, TUI wants to set up a callback function for travel agencies in the next few weeks. At the headquarters in Hanover, Kluske told the media gathering TUI was working together to process requests for departure dates.
● Up Nearly 300 Percent! Agency sales rebound, far outstripping totals for last year. There was a year-on-year increase of almost 300 percent. The total invoiced turnover of the travel agencies recorded in the “ta.ts* travel agency mirror” in May 2021 was plus 294.4 percent compared to the same month last year.
The over-the-top increase vs. May 2020 is due in part to the fact that industry business had hit rock bottom in May of last year. As such, the record increases in turnover show that travel and tourism are bouncing back (to normality, one hopes) to pre pandemic levels. Other data points in the travel agency mirror” include the following:
—The billed tourism turnover shows an increase of 247.2 percent in May.
—Air traffic revenue was up 196.0 percent for May.
—“Other sales” were up 109.4 percent and the number of tickets is plus 185.4 percent.
—The turnover from the tourism sub-division cruises was an increase of 134.4 percent in May.
—Viewed cumulatively (Remember, the first several months of 2020 were healthy in terms of sales; as such, the year-on-year cumulative will be lower levels of sales overall.)
—The total invoiced travel agency turnover in the months from January to May is minus 69.5 percent.
—Tourism recorded a minus of 79.7 percent.
—Air traffic recorded a decline of 71.1 percent.
—”Other sales” showed a drop-off of 39.7 percent.
—The number of tickets scored a decrease of 74.7 percent.
—The cruises segment recorded a minus of 77.2 percent.
Meanwhile, incoming orders for tourism were up 177.8 percent on a monthly basis.
The tourism order backlog by travel date up to October 2021 is minus 69.2 percent. In the sub-division cruises, incoming orders are plus 199.8 percent in a month-on-month comparison, the order backlog according to the travel date up to October 2021 is minus 58.0 percent.
● FTI has new brand. The tour operator has created a new look for its main brands. One of Germany’s top operators, Munich-based FYI, is using the current atmosphere of change in the tourism industry as an opportunity to relaunch its brand. The new logo has less orange and appears to be more airy and high-value.
“The logos for the FTI Group, FTI Touristik, Drive FTI and the FTI Ticketshop have been given a facelift in all our source markets and will replace our previous representation with immediate effect,” explains Ralph Schiller, FTI group managing director. “We are focusing on a uniform, open, fresh and contemporary design.”
At the same time, added Schiller, FTTI Group is concentrating its color scheme on the contrast between gray and orange – which should look more elegant. Schiller explained the new concept should make FTI Group independent of backgrounds for the integration of the logos on travel documents, sales information, advertising material or in moving images, and therefore particularly flexible.
“As cautiously as we currently still have to deal with such tendencies, it currently looks as if the Corona pandemic can be brought under control and the tourism industry can get back to full speed,” Ralph Schiller summed up. “We are pleased to be able to literally send out a signal for the dawn of a new world of travel with our new logo.”
● International capacity slowly, slowly expanding. The last time we checked, airlines have taken steps to make sure they are market ready once border issues and other travel restrictions are removed. In the meantime, the activity of some of the legacy carriers shows some movement. For instance,
—Lufthansa is bringing back its flights to the U.S. On Wednesday, June 2nd, the airline brought back service to Orlando International Airport and Hartsfield-Jackson Atlanta International Airport. There are also flights to Detroit.
—Delta Airlines has flights to the U.S. from Frankfurt, Berlin, Munich, Hamburg and Dresden
—American has flights to the U.S. from Frankfurt, Dusseldorf and Munich.
—United has flights to the U.S. Frankfurt, Dusseldorf, Munich.
Almost all of the above connections have at least one stop between destinations. And while they don’t seem to be major revenue generators, the legacy carriers seem to believe that, by having flights during this period of near-zero activity, they will build share that they will keep once there is a back-to-normal level of activity.