TUI customers paid 18% more for summer holidays

A Boeing 787 of the travel company TUI taxis near the north runway at Gatwick Airport

TUI said the Canaries, Balearic Islands, Greece and Turkey all remain popular holiday destinations. Photo: Reuters/Peter Nicholls

TUI (TUI.L) has announced that its customers have paid 18% more for their summer holidays compared to 2019, adding further pressure on households facing the worst cost of living crisis in a century.

The tour operator stood by its guidance of returning to profitability this year despite third-quarter losses as travelers flocked to Europe and the Caribbean.

The Canaries, Balearic Islands, Greece and Turkey remain popular holiday destinations, the German group said.

Meanwhile, winter bookings have also picked up, reaching 78% of pre-COVID levels.

Bookings for November and December are currently 81% of 2018-2019 levels and the group expects last-minute booking trends to continue into the winter.

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“The Canary Islands, Mexico, Egypt and Cape Verde are expected to form an important part of our holiday offer in the coming winter,” said TUI.

It added that average holiday sale prices are 26% higher during the winter season.

Fritz Joussen, outgoing CEO, said in a joint statement with his successor Sebastian Ebel: “The trend is towards higher quality or longer vacations with a higher total vacation budget.

“This is encouraging and shows the current importance of holidays and travel experiences in the post-corona period.

“Thanks to the efficiency programs successfully implemented during the pandemic, we have also significantly and sustainably reduced our cost structure. We are leaner, more digital and more efficient.”

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It came as TUI said last month widespread airport disruptions, including flight cancellations and delays, had cost it 75 million euros (£66million) in the three months to the end of June.

Customers were impacted by around 200 canceled flights in May and June, largely due to staffing shortages at Manchester Airport.

TUI announced that it would seek compensation from the airports for the disruption and costs.

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“Although 2022 should be the year of a comeback for travel stocks after the industry was hit by the pandemic, TUI and others have had a rough time this year,” said Victoria Scholar, head of investment at Interactive Investor.

“TUI’s shares are down nearly 50% year-to-date as the broader market sell-off, rising cost inflation, labor shortages and general chaos for international travelers have unleashed a perfect storm for the company.

“Over the long term, investors in TUI have had a tough time, with shares down 75% over the past five years after the stock peaked in 2018.”

Stocks in London were down 2% at the time of writing, despite initially opening higher.

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