Travel trade bookings plunge

Holiday hiatus: Small operators face collapse while giants prepare to slash capacity

The British travel industry yesterday disclosed that it has suffered a further slump in bookings that could force holiday companies to drastically reduce capacity next year and drive smaller operators and travel agents out of business.

The potential crisis follows industry figures which show that 1996 bookings are down by more than 30 per cent on this year.

Cumulative figures to September show bookings at Thomson, Britain's largest tour operator, are down 40 per cent. Bookings at Airtours, the second- largest group are down 50 per cent, while those at First Choice show a 6 per cent drop.

Shares in both Airtours and First Choice fell yesterday although the latter denied that the bookings slump might jeopardise its pounds 44m rights issue.

Although autumn is traditionally a quiet time for holiday bookings, the industry is looking nervously to the key January period, when many summer holidays are traditionally booked.

If bookings for summer 1996 do not pick up then, holiday companies will be forced to reduce capacity further. This follows a nightmare summer for holiday companies when travel groups overestimated demand and were left with a million unsold holidays. These were then heavily discounted.

Larger operators such as Airtours and First Choice have already said they will reduce capacity for 1996 by 10 per cent and increase brochure prices by around 8 per cent.

But for smaller travel companies, many of which have already experienced poor trading this summer because of the heatwave, it could be the final straw. "Some of the smaller companies might find it difficult," a spokesman for the Association of British Travel Agents said. ABTA said many smaller companies were already feeling the squeeze as suppliers' bills were arriving, while bookings were weak.

The figures on low 1996 bookings confirm the trend towards the late booking of holidays, which destabilises the industry. Holiday companies prefer customers to book holidays early as they can earn interest on the cash. Early bookings also tend to be made at the full brochure price, while last-minute deals are usually sold at a discount.

Tour operators were saying yesterday that the slump in bookings appears worse than it really is because the 1996 brochures were launched in September this year rather than in August. This means travel groups have had less time to sell the holidays. Other factors include uncertainty ahead of next month's Budget. "There is no panic," one said. "No one will really do anything before they see what January is like."

Tour operators say holidays in Spain - nearly half the market - are selling poorly. Cyprus is another poor performer. Winter sun holidays have been selling poorly.

The crisis follows the hot summer that has ravaged the travel trade's profits, with many British people choosing to bask in the sun at home rather than book overseas holidays.

Start your day with The Independent, sign up for daily news emails
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Assistant / Buyer

£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

Day In a Page

Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

Is this the future of flying?

Battery-powered planes made of plastic, and without flight decks
Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

Isis are barbarians

but the Caliphate is an ancient Muslim ideal
The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

Curse of Brink's Mat strikes again

Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

'The ministers talk to us about miracles'

Why Greeks are cynical ahead of the bailout referendum
Call of the wild: How science is learning to decode the way animals communicate

Call of the wild

How science is learning to decode the way animals communicate
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'
10 best statement lightbulbs

10 best statement lightbulbs

Dare to bare with some out-of-the-ordinary illumination
Wimbledon 2015: Heather Watson - 'I had Serena's poster on my wall – now I'm playing her'

Heather Watson: 'I had Serena's poster on my wall – now I'm playing her'

Briton pumped up for dream meeting with world No 1
Wimbledon 2015: Nick Bollettieri - It's time for big John Isner to produce the goods to go with his thumping serve

Nick Bollettieri's Wimbledon Files

It's time for big John Isner to produce the goods to go with his thumping serve
Dustin Brown: Who is the tennis player who knocked Rafael Nadal out of Wimbeldon 2015?

Dustin Brown

Who is the German player that knocked Nadal out of Wimbeldon 2015?
Ashes 2015: Damien Martyn - 'England are fired up again, just like in 2005...'

Damien Martyn: 'England are fired up again, just like in 2005...'

Australian veteran of that Ashes series, believes the hosts' may become unstoppable if they win the first Test