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Tui, Europe’s biggest holiday company, says it is back to “business as usual”, with cruise sales surging.
The Euro 2024 football tournament in Germany and the Olympics in Paris dented sales for the holiday giant in June and July. But Tui says demand has bounced back, with strong sales for August, September and October.
“We are now back to really strong late bookings,” said Tui Group chief executive Sebastian Ebel.
He was speaking as Tui announced a rise in group revenue by 9 per cent to a record €5.8bn (£5bn) euros for the three months between April and June 2024.
Average selling prices are 3 per cent higher than the previous year, with UK bookings up 5 per cent. Tui predicts revenue for the full financial year to the end of September 2024 will rise by “at least 10 per cent” with profits up by a quarter from last year’s €977m (£878m).
Demand for cruises is soaring, with average fares up 7 per cent and occupancy up 3 per cent to 98 per cent. Profits from the cruise business during the quarter rose 42 per cent to €91m (£78m).
The cruise performance was despite the “major cost impact” of re-routing voyages that were intended to go through the Suez Canal because of the conflict in the Middle East. Ships instead sailed around Africa, greatly adding to costs.
Mr Ebel told The Independent that the closure of Russian airspace to Western aircraft following Vladimir Putin’s invasion of Ukraine had also had “a significant cost impact”.
Airlines have complained about delays due to air-traffic control disruption in Europe, and Mr Ebel criticised the current arrangements, where every country controls its own skies.
“Being in Europe and not having one European [air-traffic] control is not really understandable,” he told The Independent.
Like other travel giants, including Ryanair, Tui has been hit by the slowdown in deliveries of the Boeing 737 Max due to safety concerns at the manufacturer.
Mr Ebel called it “a real nightmare”. The company has chartered in extra capacity and cancellation has been minimal – apart from the CrowdStrike IT collapse, which hit Tui’s UK operations hard.
The Tui CEO also tackled the issue of overtourism, with a swipe at Airbnb – saying: “Our customers don’t take away houses from anyone.”
Mr Ebel said: “We bring our guests by bus into hotels. We more and more buy food locally.”
He added that he respected the choices of destinations such as Venice to introduce a charge for day visitors, but that most locations welcome more tourists.
“Turkey, Egypt and Cape Verde – they’re happy about every customer we bring,” he said.
“We have new destinations like Zanzibar, like Senegal and the Dom Rep [Dominican Republic] is coming back for us.”
But the Tui chief executive told The Independent: “Countries like Lebanon, Jordan or Israel are not really existing anymore for major tourism.”
