Last week’s general election result should drive a strong peaks market as consumers begin to take advantage of the rising pound.
Boris Johnson’s considerable Conservative victory was met by an immediate bounce in the pound which broke the $1.35 mark, a peak last seen in May, on the Friday before settling at $1.33.
Closer to home, the pound closed at €1.20 the day following the election after global markets reacted to the result that should break the recent stalemate over Brexit, resulting in the UK’s departure from the EU on 31 January.
Travelzoo general manager UK James Clarke argues this will kick-start the forthcoming peaks period following a poor first quarter in 2019 when Brexit uncertainty impacted holiday bookings.
He said: “The peaks market will go back, if not to 2018 levels, then beyond it as there’s a lot of pent-up demand.”
Clarke added the resorts should also see more money from holidaymakers as they turn their backs on all-inclusive properties to stay in hotels with various board options or self-catering accommodation as their money goes further.
He also argued the UK domestic market should receive a boost as Brits spend more generally on trips while he believed many Europeans stayed away from the country due to the endless Brexit arguments.
Furthermore, Clarke said the Thomas Cook collapse has led to less capacity, even with rivals including Tui, Jet2.com and easyJet filling some of the holes as well as returning to destinations like Tunisia and Sharm el Sheikh as they reopen to the UK.
He added: “EasyJet must be very confident it will get the numbers back, it wouldn’t go back into Tunisia if they weren’t sure the numbers are there.”
Clarke said the additional capacity could also drive discounting in countries like Spain and Portugal, which have capitalised on the recent reduced Mediterranean capacity.
“If someone’s putting in a load more capacity into Sharm and you have all-inclusive five-star at £399, the others will have to come back.”