Package holiday bargains sell out

Cheap deals: Last-minute giveaways scarce as tour companies vow not to repeat last summer's suicidal discounts

Anyone looking to match 1995's last-minute package holiday giveaways could be left kicking their heels at home, according to two of Britain's largest tour operators.

Airtours and Thomson believe that a combination of discounts for early bookers and a sharp fall in the number of holidays on offer has foiled the bargain hunters.

Harry Coe, the finance director at Airtours, said that lower capacity had led to fewer bookings - down 16 per cent on last year - but that it had also put an end to the suicidal discounts that had stung the industry last summer.

"If you walked down the high street last weekend and looked at the prices being demanded for departures in August, you'd have seen prices were pounds 60 higher than was the case at the same time last year.''

A typical example was a fortnight on the Costa Brava, on offer in high- street travel agents for more than pounds 300, compared with an original brochure price of pounds 350. Last year the same booking might have been as little as pounds 225, said Mr Coe.

Thomson claimed to have given only half as many discounts this year as in 1995, with much smaller price reductions.

In recent years the holiday market has been dogged by job insecurity, hot summers at home and an increasing weariness with tacky, over-developed holiday destinations. Now more upmarket holidays, including long-haul trips and cruises, are the most buoyant area of the market.

Tour operators are still licking their wounds from a disastrous 1995, when 10 million holidays failed to find enough buyers.

By August last year the likes of Airtours, First Choice and Thomson were giving away breaks at prices that barely covered aircraft charter and hotel block- booking.

Profits at leading companies plunged and they vowed last autumn not to make the same mistake again. This summer, capacity has been cut to 8.5 million holidays. Mr Coe said it means customers have found it increasingly difficult to buy the holiday they want.

As a result of smaller discounts, many are plumping to pay full price for a named hotel they can see pictures of rather than take a chance on an unnamed venue for a saving of maybe only pounds 40.

The tone was set for this summer when Thomson introduced "fluid pricing" last autumn. It rewarded early bookings with discounts and promised higher prices as summer approached. The threat to holidaymakers was that hanging on would increase the cost rather than throw up the bargains they had come to expect.

A spokesman at Thomson said: "It was such an obvious idea, it is amazing really that no one had thought of it before."

Airtours added a new twist to the cut-throat battle for a share of the package market this season when it launched its summer 1997 brochures at the beginning of July, before many holidaymakers had left for this year's trip. The move caused a furore in the travel business, with agents complaining they were being forced to sell holidays for three seasons at the same time.

Yesterday, however, Airtours claimed the tactic had been an overwhelming success, giving it 50 per cent of the holidays so far sold for next year.

The spokeswoman for Thomson said the claim was meaningless, as it had only launched its own 1997 holidays last week. She said Thomson had sold more holidays in three days than Airtours managed in the whole of July.

Mr Coe said it was too early to suggest a return of the feel-good factor to the holiday market. But he said more costly holidays, including trips and cruises to faraway destinations, were the most expansive area of the market.

Analysts said the holiday companies appeared to have made a better fist of matching supply and demand this year but they questioned whether the industry had really cured itself of its volatility.

Rising profits, they said, would inevitably lead to more capacity, increasing competition and the return of the last-minute bargain.

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
ebooksA celebration of British elections
Ed Miliband and David Cameron are neck and neck in the polls
election 2015Armando Iannucci: on how British politics is broken
Arts and Entertainment
Billie Piper as Brona in Penny Dreadful
tvReview: It’s business as usual in Victorian London. Let’s hope that changes as we get further into the new series spoiler alert
Life and Style
A nurse tends to a recovering patient on a general ward at The Queen Elizabeth Hospital in Birmingham
Arts and Entertainment
No Offence
tvReview: No Offence has characters who are larger than life and yet somehow completely true to life at the same time spoiler alert
Chuck Norris pictured in 1996
Arts and Entertainment
Sarah Lucas, I SCREAM DADDIO, Installation View, British Pavilion 2015
artWhy Sarah Lucas is the perfect choice to represent British art at the Venice Biennale
A voter placing a ballot paper in the box at a polling station
Arts and Entertainment
The Queen (Kristin Scott Thomas) in The Audience
theatreReview: Stephen Daldry's direction is crisp in perfectly-timed revival
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

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

iJobs Job Widget
iJobs General

SThree: Trainee Recruitment Consultant - Birmingham

£18000 - £23000 per annum + Uncapped OTE: SThree: SThree Trainee Recruitment C...

SThree: Trainee Recruitment Consultant - Dublin

£13676.46 - £16411.61 per annum + OTE: SThree: SThree Trainee Recruitment Cons...

Ashdown Group: Marketing or Business Graduate Opportunity - Norwich - £22,000

£18000 - £22000 per annum + training: Ashdown Group: Business and Marketing Gr...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + Commission: SThree: Are you great at building rela...

Day In a Page

General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'
Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

Flesh in Venice

Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
11 best anti-ageing day creams

11 best anti-ageing day creams

Slow down the ageing process with one of these high-performance, hardworking anti-agers
Juventus 2 Real Madrid 1: Five things we learnt, including Iker Casillas is past it and Carlos Tevez remains effective

Juventus vs Real Madrid

Five things we learnt from the Italian's Champions League first leg win over the Spanish giants
Ashes 2015: Test series looks a lost cause for England... whoever takes over as ECB director of cricket

Ashes series looks a lost cause for England...

Whoever takes over as ECB director of cricket, says Stephen Brenkley
Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power