Martin Alcock, director of the Travel Trade Consultancy (TTC), warned Aito conference delegates that large tour operators might have to start pulling levers if they don’t achieve the growth they’re anticipating next year.
This, Alcock told the conference in Thessaloniki, could lead to potential price reductions, impacting the rest of the market – including specialists.
"I personally cannot see there’s enough demand for all of them to achieve [such a growth],” he said on Friday (24 November). “The big fear therefore is that they will become like Icarus, flying too close to the sun.”
The UK’s three largest operators – Jet2holidays, Tui UK and easyJet holidays – have all grown their Atols for the 12 months to the end of September 2024, with several of the biggest OTAs operating in the UK market also adding millions of extra seats between them.
Alcock said that following a record summer this year in terms of both capacity and revenue, large operators now feel buoyed about their prospects for 2024, despite socio-economic and political challenges – something acknowledged by Jet2.com and Jet2holidays in its half-year results announcement on Thursday (23 November).
Alcok said the UK’s largest Atol holders are set to grow, on average, by 23% next year, with the rest of the market expecting “marginally lower” growth, especially in the second part of the year.
This, he said, would stem from inflation – which currently remains at almost 5% – and higher interest rates, which are not expected to go down from a current 5.25% at least until June 2024, Alcock told delegates citing Bank of England predictions.
Britain’s economic situation could nevertheless change depending on a variety of factors, Alcock continues. These include upcoming elections in the UK and the US, the rise of far-right governments in central Europe and around the world, and the ongoing conflicts in the Middle East and Ukraine.
“It’s a crazy world we’re living in,” Alcock said. “All of these things have an impact.”
