The demand for British tourism to the south of Gran Canaria is in good health, for the moment, and operators are crossing their fingers that no spark will fly at the headquarters of the European Central Bank that will destroy prices. The UK's three largest package holiday operators, which have much of their winter market in southern Gran Canaria, say they are confident of having "the right number of holidays" on sale by 2024, in response to growing trade fears. on excess capacity. Fears have been growing in the sector that overcapacity next year will lead to a price war in the mass market.
All this that affects the south of Gran Canaria began in Greece at the end of November. Travel Trade Consultancy director Martin Alcock expressed concern that this could affect the entire industry. Speaking at the Aito Overseas Conference in Greece, he said: “I don't see there is enough demand for all of them. My biggest fear is that some of these big operators will break up. “If bookings don’t come in, it means potential challenges and there will be a knock-on effect for the rest of the market.” His concerns were echoed by smaller operators, who fear the additional influence exerted by larger players.
The bullish outlook came as TUI praised double-digit growth in sales through independent agents following its commitment to work more closely with third-party retailers. Bosses at TUI, EasyJet Holidays and Jet2holidays said they had based their capacity decisions on current demand, but admitted discounts were possible in recent times if market conditions changed.
Between October 2022 and October 2023, the three companies added 3,3 million vacation spots to the market for travel in the next 12 months. Jet2holidays chief executive Steve Heapy said he was fairly confident he could cover that capacity. He admitted there could be a discount risk, adding to media in London: "capacity is adequate. But if there is an escalation of war in the Middle East or Ukraine or a major financial crisis, then there will be an imbalance between supply and demand. demand and prices will go down.
TUI UK managing director Andrew Flintham agreed: "We'll keep our fingers crossed for January, but things are looking good." Neil Swanson, TUI's marketing director, said "this is the most competitive turn of the year I can remember" but admitted: "We need to see if it is strong enough for all of us." Responding to discounting fears, he added: "I don't expect to see that at the end of the year, but when we get to the end we'll see what people have left and what needs to happen to eliminate the volume." .”
EasyJet CEO Johan Lundgren was also optimistic about next summer. "People will gravitate towards value; that benefits companies [like us] as a low-cost airline," he said. Lundgren said he expected easyJet Holidays passenger numbers to grow more than 35%, increasing its market share from 5% to 7% in its financial year to September 2024. Early UK bookings for next year were already “very strong” but, in terms of supply and demand, he said: “It remains to be seen how well balanced will be".
