Holiday firm Tui has announced it will not be offering last-minute, low-price deals this summer due to a recovery in customer demand, its chief executive has said. Fritz Joussen said the company will hold its current pricing, unlike in previous years.
He told reporters: "There will be practically no last-minute deals for this summer... Over the past six weeks, we’ve seen demand beyond 2019. We want to keep that momentum but aren’t going to suddenly shift to discounting.”
Tui said pricing for this summer has increased by 20 per cent, but bosses stressed that this was driven by longer holidays and more expensive trips, including five-star hotels, as many people travel again for the first time since the coronavirus pandemic. It comes as the company more than halved its losses for the past six months as the rebound in customer numbers accelerated and bookings jumped.
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The company reported an earnings loss of 614.5 million euros (£525 million) for the half-year to March 31, following a 1.3 billion euros (£1.11 billion) loss for the same period a year earlier.
Tui told shareholders it could return to profit by the end of the year as a result, and said it expects a “strong” summer and has already achieved 85 percent of the booking levels seen in summer 2019 - before it felt the impact of the pandemic.
The latest quarter was “significantly improved”, the holiday giant added, as the easing of Covid-19 restrictions helped boost bookings, with its UK operation “continuing to lead the way” for summer bookings - which currently show an 11 per cent increase against the levels seen in summer 2019. The travel group said overall it expects bookings for the summer to “almost reach” levels from 2019, adding that it has been buoyed by holidaymakers booking “more at short notice” and also spending more money on each trip.
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Meanwhile, revenues for the past half-year increased more than five-fold to 4.5 billion euros (£3.8 billion) against the same period a year earlier, when the firm was still struggling with coronavirus restrictions.
Mr Joussen said: “The high demand for travel and the very good business performance confirm our forecasts. 2022 will be a good financial year. Capacity almost reaches pre-corona level of 2019. After two years of crisis, we expect Tui to become profitable again in the current financial year with a significantly positive underlying EBIT (earnings before interest and tax). This is the basis for new growth.”
