The ongoing war in Iran continues to favor the trend of last-minute bookings, emphasized the world leader in tourism TUI on Wednesday, confirming its revised annual forecasts in April.
“Our results as well as the entire market show a trend towards increasingly last-minute bookings, especially in favor of destinations in the western Mediterranean,” the group said during the release of its quarterly results.
Nearly half of consumers planning to travel this summer have not yet booked, according to TUI.
Demand is shifting towards Spain, including the Balearic Islands and the Canaries, as well as Greece, considered to be the most popular destinations this summer.
However, “it is still difficult to get people to travel to the Maldives, the Seychelles, Thailand, etc., even with our own flights, as customers hesitate to transit through Dubai, Doha, or Abu Dhabi,” located in the Middle East, a region shaken by war, said Sebastian Ebel, CEO of TUI, during a conference call.
The Hanover-based group is generally expecting an increase in average prices emerging in the hotels and cruise ships of the group, which should partially offset the rise in costs.
From January to March, the group’s revenue, which offers a range of trips, hotels, charter flights, and cruises worldwide, increased by 1.7% at constant exchange rates, reaching 3.74 billion euros.
The operating loss, at 188 million euros, is approximately 9% lower than the previous year, despite the negative impact of the war in Iran, estimated at 40 million euros: two ships blocked in the Emirates could not be operated for about ten weeks and customers had to be repatriated from the Middle East and the Far East.
Regarding fuel availability for its planes and boats, there will be no shortages in the short term and “we are confident that there will be no shortage this summer,” Mr. Ebel assured.
On the other hand, regarding the emergence of the hantavirus, which has been at the center of international health authorities’ attention since a cluster was detected on the MV Hondius cruise ship, TUI does not feel “any impact” on cruise reservations to date, which “are very strong,” according to Mr. Ebel.
TUI decided in April not to disclose an annual revenue forecast and is still not willing to do so in an unstable environment.
The adjusted operational profit from exceptional items (adjusted EBIT) is expected to remain between 1.1 and 1.4 billion euros, equivalent to the previous year, which stood at 1.4 billion euros.
