Travel agents in Germany are hoping that a surge in late bookings for summer 2019 will reverse a serious sales slump and enable them to generate stable revenues this year.
The booking conditions could not be better, according to experts. The German economy is stable, private consumption remains strong and there are no major sporting events this summer to keep people at home. Only the weather remains a factor for uncertainty, with record temperatures this spring reviving memories of last year’s summer heatwave.
Yet demand is well below last year. Summer sales dropped by 12% in April, leaving cumulative sales to date with a 2% drop, according to monthly figures from market researchers GfK. Although sales figures in early 2019 had to compare with strong early bookings last year, sales growth already tailed off last spring, meaning there is now a lower comparison level.
“We don’t have any explanation. 2018 was a dream year in terms of trips,” admitted DER Touristik’s Werner Sülberg, who is chairman of the DRV market research committee. Both tour operators and travel agents are behind last year’s levels as of late May, he observed.
Given that attractive early booking discounts did not generate any boom in bookings despite low prices, tour operators and travel agents are now urgently hoping that consumers will book last-minute for this summer.
But there are few signs so far of any surge for June or July. According to data analysis firm Trevo Trend, booking enquiries in May were down for June (-4%) and July (-3%), even though these two months were already weaker last year.
The question now is whether travel firms will start to lose their nerves and cut prices dramatically to try to win business. There are already plenty of special offers on the market from tour operators and cruise firms. “I’ve never seen such a flood of discounts and voucher actions,” declared one top agency chain boss.
But cheap holidays do not necessarily mean higher sales revenues, especially as demand is already high for lower-priced destinations such as Turkey and Egypt while Spain has a high double-digit decline and bookings are also down for Greece by a slight double-digit level.
Market researcher Sülberg put it like this: “If things go well, we might achieve zero growth. But without knowing why.”