Industry & Business

Summer bookings for Turkey slump 40%

Summer bookings for Turkey slump 40%

February 09
12:54 2016

TUI_tourLondon-based TUI Group, the world’s largest tour operator, said bookings to Turkey this summer were down around 40% due to security concerns, as it reported a narrower first-quarter loss.

Terror attacks in Egypt, Turkey, Tunisia and Paris over recent months have made tourists more wary of those previously popular destinations.

The Zika outbreak in the Americas is also dampening global travel sentiment.

The caution comes at a crucial time of year for holiday firms, because their customers often book their summer holidays in January, February and March.

The tour operator kept a forecast for underlying earnings to rise by at least 10% on a constant currency basis, despite the drop in demand for Turkey.

It said that around 14% of its customers had travelled to Turkey last summer, with the destination being especially popular with Germans.

But after a suicide bomb killed 10 German tourists in Istanbul in January, demand had slumped.

In response, TUI has shifted capacity to Spain and Greece and said its own hotels in Spain, especially the Canary Islands, were benefiting from increased demand for those destinations.

German daily Bild on Sunday cited a survey showing sales at German travel agents were down 13% in January.

Turkey meanwhile has offered jet fuel subsidies in a bid to stimulate tourism demand after the January attack.

TUI reported a narrower first quarter underlying loss before interest, tax and amortisation (EBITA) of €101.7m compared to a loss of €104.8m a year earlier. Travel companies typically report a loss in the first quarter.

It also took a €42m hit from a writedown of its stake in shipper Hapag-Lloyd, reflecting a weaker share price for the company.

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