Travel agents in Germany generated solid growth of 4.6% in 2017 but are losing market share to fast-growing OTAs and tour operator websites, fvw’s latest dossier shows.
Travel agents increased their combined sales by 4.6% to €26.4 billion last year, according to the annual fvw ‘German travel sales’ dossier based on company figures and calculations by the German Travel Industry Association (DRV). This compensated for a 2.4% decline in 2016 and took revenues above 2015 levels.
Tourism sales increased by 5% to €14.8 billion, which did not fully compensate for a 5.6% slump in 2016. Flight sales grew by 4.1% to €8.4 billion, building on a 2% increase in 2016, while rail ticket sales declined slightly to under €600 million. Other revenues increased by 5.3% to over €2.5 billion. The number of full-time and part-time travel agencies dropped by 306 to 11,116, according to the dossier.
Although the 4.6% sales growth appears good, two factors need to be taken into account. The German tour operator market, which accounts for a large proportion of travel agency sales, grew by a higher 8% to €33.7 billion last year. Moreover, online travel agencies (OTAs) and tour operator websites increased revenues by as much as 14%, according to the dossier. Traditional travel agencies are thus continuing to lose market share in a growing market.
There were few changes in the top five ranking, with the top four retaining their positions. DER Touristik remained Germany’s largest travel agency chain, increasing sales by 3.5% to €4.62 billion. The RT Group and TUI Germany both generated solid growth of 2.1% and 2.7% respectively. The TSS cooperation network grew strongly with an 8.6% increase in revenues.
The new number five is the Schmetterling cooperation group which overtook Lufthansa City Center (which changed its calculation basis). The remaining organisations in the top ten ranking are business travel specialist BCD, LCC, Thomas Cook Partner Group, and cooperation groupings AER and Best-Reisen.
Looser cooperation networks grew more strongly than centrally-managed chains and franchise organisations last year, the fvw dossier found. The cooperation groups increased sales revenues by 5.1% to €12.1 billion while chains and franchises grew by 3.5% to €12.5 billion. These organisations accounted for a combined 93% of total travel agency sales.