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The European Leisure Travel Industry - September 2015

INTRODUCTION
KEY FINDINGS
DATA SOURCES
ABBREVIATIONS
ISSUES IN THE MARKET
POLITICAL STRIFE AND TERRORISM
SHARING-ECONOMY IMPACT
CLIENT DISRUPTION AND LAWSUITS
EU REGULATION AND SUBSIDIES
GLOBAL SUMMARY
Key points
DEMOGRAPHIC TRENDS
Figure 1: Worldwide population distribution by age cohort, in millions, 2013 & 2050
SENIORS NOT ‘MILLENNIALS’ ARE THE GROWTH MARKET
ECONOMY
Figure 2: World Economic Outlook projections, year-on-year % change unless otherwise noted, July 2015
EXCHANGE RATES
Figure 3: Currency rate forecast, 23 June 2015
TOURISM FLOWS
Figure 4: Tourist arrivals* in the principal European countries, in millions, 2008-18
Figure 5: Tourist arrivals* in the principal European countries, in millions, 2008-18 (continued)
TOURISM ARRIVALS ACROSS EUROPE
Figure 6: Arrivals in tourist accommodation establishments in European countries, 2009-13
DEPARTURE RATE BY COUNTRY
Figure 7: Percentage of population taking a trip for personal purposes of 4 nights or more during the year,
by European country, 2009-13
SPENDING ON TRAVEL AND TOURISM
Figure 8: Spending on travel & tourism in Europe, in US$ millions, 2014 & 2025
POLITICAL STRIFE AND TERRORISM
Key points
GREXIT ON THE HORIZON?
Booking.com figures show the trend
Figure 9: Room nights reserved & cancelled in Greek accommodation establishments, 1 June-19 July 2015 . 30
TUNISIA IN HEADLINES AGAIN
Terrorist attack at beach resort hotel
Tunisia losing tourists
German tourists stay but bookings drop
Winter schedules not altered yet
Tour-operator margins hit
TUI UK offers special concessions
Thomas Cook
SHARING-ECONOMY IMPACT
Key points
PEER-TO-PEER ACCOMMODATION RENTAL WEBSITES
Airbnb’s host cancellation policy
Ibiza in mid-July?
Figure 10: Holiday rentals offered by HomeAway for the week of 15-22 July 2015 as of 20 June 2015
Evidence of disruption
Apartment rental listings’ top hotel rooms in Spain
Less job creation and lost tax revenue
CAR-SHARING PLATFORMS
BlaBlaCar is consolidating the sector
Financing
Expansion strategy
Eastern Europe a fertile field for car-sharing expansion
US not on radar screen
Challenge for growth
CLIENT DISRUPTION AND LAWSUITS
Key points
DISRUPTIVE AIR PASSENGERS ON THE RISE
14 passengers offloaded
Ryanair has banned booze on Scotland to Ibiza flights
Ryanair passengers on rampage again
Calls to get tough with unruly passengers
A national database of disruptive passengers
MISHAPS AND DISASTERS LEAD TO LAWSUITS
Suing for a broken ankle
Food poisoning
Furious cruise passengers sue
Man speared through eye by hotel parasol
The case of Bobby and Christi Shepherd
Media campaign against Thomas Cook
Conclusion
EU REGULATION AND SUBSIDIES
Key points
EUROPEAN PACKAGE TRAVEL DIRECTIVE
‘Linked travel arrangements’ to be covered
ABTA reaction
Strengthening consumer protection
EU regulation catching up with the technology
A more level playing field
Business to leak outside EU?
EU AIRLINES CREATE LOBBY GROUP
EU SUBSIDIES FOR TOURISM
The European Regional Development Fund
Type and level of funding
The Cohesion Fund
Type and level of funding
The European Social Fund
Type and level of funding
Maltese training programme
The ‘European Agriculture Fund for Rural Development’
Type and level of funding
The European Maritime and Fisheries Fund
Type of tourism-related actions eligible for funding
Type and level of funding
LIFE
Type of tourism-related actions eligible for funding
Type and level of funding
Tourism for conservation in the Burren and Cliffs of Moher geopark (Ireland)
Horizon 2020
Type and level of funding
COSME
Type and level of funding
Creative Europe
Type and level of funding
Erasmus
Type and level of funding
Employment and Social Innovation
Type and level of funding
HOLIDAY HOTEL MARKETS
Key points
BUDGET HOLIDAY HOTELS
Egypt
Figure 11: Top 10 holiday hotel groups* in Egypt, 2013
Germany
Figure 12: Top 10 holiday hotel groups* in Germany, 2013
Greece
Figure 13: Top 10 holiday hotel groups* in Greece, 2013
Portugal
Figure 14: Top 10 holiday hotel groups* in Portugal, 2013
Spain
Figure 15: Top 10 holiday hotel groups* in Spain, 2013
Tunisia
Figure 16: Top 10 holiday hotel groups* in Tunisia, 2013
Turkey
Figure 17: Top 10 holiday hotel groups* in Turkey, 2013
DISTRIBUTION
Key points
Figure 18: Total European gross bookings, 2006-16
CHANNEL BREAKDOWN BY TRAVEL SUPPLIER SEGMENT
Figure 19: Distribution channel breakdown, by travel supplier category, 2013
OTA MARKET SHARES
Figure 20: OTA share of total European market & shares of OTA market, 2012-16
OTA market shares for hotel bookings by country
Booking’s dominance
Figure 21: Market shares of the three major European OTAs, by selected countries, 2014
Major country markets
Figure 21: Forecasted OTA bookings by the three major European country markets in 2016
Mobile bookings
Figure 22: Mobile share of gross travel bookings, 2011-16
OTA REGULATION
Price parity broken down
The ‘Macron Law’ voted
ETTSA attacks the hotel industry
Italy to take legal action
CRUISING
Key points
LOW PENETRATION RATE
EUROPE CONTINUES TO DOMINATE SHIP BUILDING
SLOWING GROWTH TREND
Figure 23: European passenger statistics, 2010-14
TREND IN EUROPEAN CRUISE MARKET BY MAJOR MARKET
Figure 24: Trend in key European cruise markets, 2012-14
UK cruise-passenger numbers fall for the first time
European cruise ports
Figure 25: Revenue passengers, by major cruise port, 2014
Home ports
Figure 26: Trend in revenue passengers, by major cruise home port, 2012-14
Ports of call
Mediterranean
Figure 27: Trend in major Mediterranean ports of call, 2012-14
Figure 28: Cruise lines offering itineraries & schedules to La Spezia, 2015
Atlantic and Northern Europe
Figure 29: Trend in major Atlantic & Northern European ports of call, 2012-14
THE EUROPEAN CRUISE FLEET
The Mediterranean
Northern Europe – Baltic
CRUISE-SHIP PIPELINE AND INVESTMENT 2015-18
Figure 30: Cruise-ship pipeline, 2015-18
MAJOR PLAYERS
Carnival Cruise Lines
UK brands
Continental Europe
Royal Caribbean Cruises
Royal Caribbean International
Celebrity Cruises
Azamara Club Cruises
Pullmantur
CDF Croisières de France
TUI Cruises
TUI’s cruises
Hapag-Lloyd Kreuzfahrten
Hapag-Lloyd Cruises Club
TUI Cruises
Cruise performance
Figure 31: Financial performance of TUI’s cruise activities (Hapag-Lloyd & TUI Cruises), FY 2009-14
MAJOR PLAYERS
Key points
Figure 32: Top 10 European travel companies, FYs 2013 & 2014
TUI GROUP
SWOT ANALYSIS
Figure 33: TUI Group’s share price since listing on 17 December 2014, 3 July 2015
TUI AG HAS ACQUIRED TUI TRAVEL PLC
Well received in the market initially
Synergies to be had
TOUR OPERATING
ONLINE ACCOMMODATION
TUI exiting B2C accommodation distribution
TUI closes AsiaRooms
LateRooms.com up for sale
BRAND CONSOLIDATION
BRAND MIGRATION
BRAND VALUE SOARS
Interbrand’s methodology
Financial analysis
Role of brand
Brand strength
A NEW DISTRIBUTION INITIATIVE
THOMSON UPGRADES DREAMLINER FLEET
TUI HOTELS & RESORTS
Figure 34: TUI Hotels & Resorts hotel portfolio, 2014
Figure 35: TUI Hotels & Resorts hotel portfolio, 2014 (continued)
Robinson to expand in three regions
TUI exits Greece before Grexit
TUI PULLING OUT OF AUSTRALIAN ADVENTURE
KEY PERFORMANCE INDICATORS
Figure 36: TUI’s tour operation KPIs with recent results, FY 2012-FY 2014
RESULTS FY 2010-FY 2014
Figure 37: TUI Group results, FY 2009-FY 2014
OUTLOOK
Regional and sectorial half-year results
Outlook for FY 2014/15
Figure 38: Outlook for TUI Group revenues & profits for FY 2014/15
Long-haul, hotels and cruises
THOMAS COOK
SWOT ANALYSIS
SHEDDING ASSETS
Figure 39: Thomas Cook’s share price for the 5-year period ending 3 July 2015
ASSET SALES DURING MARCH 2013-SEPTEMBER 2014
Thomas Cook Egypt and Thomas Cook Lebanon
Thomas Cook CFX Limited
Neilson Active Holidays Limited
Essential Travel Limited
Elegant Resorts Limited
Gold Medal Limited
NATS Holding Limited
Corporate Business Travel
Intourist Egypt
Thomas Cook Canada Inc. and Thomas Cook USA Holdings Inc.
THOMAS COOK PROMOTES BRAND THROUGH SOCIAL MEDIA
ABRUPT DEPARTURE AT THE TOP
A SHOT IN THE ARM FROM FOSUN
Cook strengthens ties with Club Med
THOMAS COOK HOTELS & RESORTS
Figure 40: Thomas Cook Hotels & Resorts’ hotel portfolio, 2014
REVENUES DOWN ON DISPOSALS, CURRENCY AND EGYPT
Figure 41: Summary of results (in £m unless otherwise stated), for FY 2013 & 2014
IMPROVED GROSS MARGIN
OUTLOOK
Figure 42: Half-year results (£m unless otherwise stated) for the six months ended 31 March 2015
Figure 43: Revenues*, by business unit (£m unless otherwise stated), ended 31 March 2015
Figure 44: Gross margin, by business, H1 FY 2013-H1 FY 2015
Figure 45: EBIT LTM*, by business unit, ended 31 March 2015
Current trading summer 2015
Figure 46: German consumer confidence, 2012-1 July 2015
Figure 47: Current trading, summer 2015
More exclusive offers
KUONI
SWOT ANALYSIS
A MAJOR SHIFT IN STRATEGY
Figure 48: Kuoni’s share price for the 5-year period ending 3 July 2015
Shift reflects changing business environment for travel
Tour-operating business sold to DER Touristik
What is included in the sale
Advantages for DER Touristik
Impact on Kuoni results and cash position
Future strategic business focus
Global Travel Distribution (GTD, formerly FIT)
Global Travel Services (GTS)
VFS Global
Strategic initiatives
FY 2014 RESULTS RECAP
Figure 49: Kuoni’s turnover, by activity, 2013-14
Figure 50: FIT (now GTD) turnover breakdown, by source markets & destinations (%), 2014
Figure 51: Group Travel turnover breakdown, by source markets & destinations (%), 2014
Figure 52: Destination Management Specialists’ turnover breakdown, by source markets & destinations
(%), 2014
Figure 53: VFS global turnover breakdown, by source markets & destinations (%), 2014
OUTLOOK
DER TOURISTIK
SWOT ANALYSIS
DER TOURISTIK TO EXPAND WITH KUONI DEAL
Present in all major outbound markets
Internationalisation and cross-border synergy
DER Touristik brands
Dertour
Meier’s Weltreisen
ADAC Reisen
ITS
Jahn Reisen
Clevertours.com
Travelix
Travel agency network
Figure 54: DER Touristik’s travel agency network, by structure, 2014
DER.COM combines technology with high-touch service
LEADING DESTINATIONS
Figure 55: DER Touristik’s top-selling destinations, by type, 2014
HOTELS
Figure 56: DER Touristik’s hotels & investments hotel portfolio, 2014
Club Calimera
PrimaSol Hotels
lti hotels
DESTINATION AGENCIES
OUTLOOK
Post-merger integration of Kuoni assets
Expected turnaround at Apollo
Switzerland to become the group’s second market
FTI TOURISTIK
SWOT ANALYSIS
FTI BUSINESS UNITS
FTI Touristik
5vorFlug
BigXtra
DriveFTI
erf46
fly.de
FTI eCom GmbH
FTI Cruises
FTI Ticketshop
FTI Voyages
Gold by FTI
LAL
Meeting Point International
Meeting Point Rent-A-Car
reise.de
travianet
TVG
Youtravel
Sonnenklar
OUTLOOK
A successful summer season
Winter season 2015/16
Shuttle to El Gouna on the Red Sea
Arab Gulf destinations added
Long haul
ALLTOURS
SWOT ANALYSIS
GREECE AND LONG-HAUL DESTINATIONS ACHIEVED DOUBLE-DIGIT GROWTH IN FY 2014
ALLTOURS HOTELS
Figure 57: alltours’ hotel portfolio, 2014
OUTLOOK
CLUB MED
SWOT ANALYSIS
A MAJOR PROFITABILITY PROBLEM
Figure 58: Club Med results FY 2011-FY 2014
DEMAND FLAT
Figure 59: Club Med performance indicators, 2012-14
SOURCE MARKETS
Figure 60: Source markets, by region (000 of hotel days sold), 2012-14
DESTINATION MARKETS
Figure 61: Destination markets, by region (000 of hotel days sold), 2012-14
CAPACITY DOWN
PRICES UP
FOSUN HAS ACQUIRED CLUB MED
Fosun counting on China to drive growth
Weekend resorts to be developed
A third Chinese?
Figure 62: Trend in clients’ source markets, 2009-14
Figure 63: Club Med customers by source country/regional market, FY 2010-FY 2014
CORE BUSINESS
CONTROLLED DISTRIBUTION
Programmes to boost direct distribution
‘Le Ballet’
‘Shop-in-shop’ outlets
Indirect sales
HOLIDAY VILLAGE OPERATIONS
Figure 64: Club Med’s village portfolio by structure & region, 31 October 2014
Figure 65: Occupancy by village grade, 2012-14
OUTLOOK
Figure 66: Revenue by region for Q1 2015, 1 November 2014-31 January 2015
HOTELPLAN
SWOT ANALYSIS
Figure 67: Hotelplan results, 2013-14
Figure 68: Hotelplan results by strategic business unit for FY 2014, ended 31 October 2014
INTERHOME GROUP
Top countries
Figure 69: Top countries & regions for Interhome holiday rentals, 2015
DENNER REISEN ELIMINATED FROM HOTELPLAN’S BRAND PORTFOLIO
OUTLOOK
ALPITOUR
SWOT ANALYSIS
TOUR OPERATING
Alpitour
Francorosso
Villages Bravo
Viaggidea
Karambola
AIRLINE
INCOMING
HOTEL MANAGEMENT
DISTRIBUTION
OUTLOOK
OAD REIZEN
SWOT ANALYSIS
OUTLOOK
TOP TEN OUTBOUND TRAVEL MARKETS
CHINA NUMBER ONE?
China still not very important for Europe
Figure 70: Top 10 countries for spending on outbound travel, 2013-14
MIXED PROSPECTS FOR OTHER OVERSEAS MARKETS
LEADING EUROPEAN OUTBOUND MARKETS
GERMANY
Strong summer holiday sales
Destination trend
Figure 71: Destinations of German holiday trips*, 2014
Figure 72: Top 10 domestic & foreign destinations for German holiday trips*, 2014
Current destination trends
Slump in Canary Islands bookings
Slowing growth at Hurghada
Majorca and Antalya up
Greece still demanded
Spending, transport and length of stay
Figure 73: Spending, transport & length of stay on long holiday trips*, 2014
German coach firms expand international routes
Type of holiday
Distribution trends
Low growth in a saturated market
Figure 74: Travel organisation & booking channel for long holiday trips*, 2005 & 2014
Use of mobile on holiday
Figure 75: Mobile Internet access during holiday trips*, 2014
High-end travel on the rise
Figure 76: High-end holiday trips*, 2004 & 2014
UK
Departure rate
Figure 77: Departure for Britons taking a holiday, 2011-14
Regional trends
Destination trends
Travel groupings
Issues impacting tourism
Outbound trend by region
Figure 78: Trips abroad by UK residents, by region, 2004-13
Figure 79: Nights spent abroad by UK residents, 2004-13
Figure 80: UK residents expenditure (£m) on outbound trips at current prices, 2004-13
Holiday trips and package tours by destination region
Figure 81: Number of visits abroad by UK residents, by area & purpose of visit, 2010-14*
Figure 82: Nights spent abroad by UK residents, by area & purpose of visit, 2010-14*
Figure 83: Spending abroad by UK residents, by area & purpose of visit, 2010-14*
Average expenditure per trip and per day
Figure 84: Average spending abroad by UK residents per visit, 2010-14, & per day, by area & purpose of
visit, 2012-14
Distribution
Figure 85: Holiday booking channel* mix, 2014
Package holidays making a comeback
Types of holidays
Figure 86: Top 10 types* of holiday taken in past 12 months, 2014
Ski tourism stagnating
Figure 87: Trend in outbound ski trips from the UK, 2007/08-2013/14
Tour operators gaining share
Figure 88: UK outbound ski trips, by segment, 2009/10-2013/14
France leads the way
Figure 89: Country mix for UK outbound ski trips, 2012/13 versus 2013/14
Outlook
RUSSIA
Figure 90: Trend in holiday packages purchased by Russian residents, 2004-13
Growth has gone into reverse
Tour-operator bankruptcies
Figure 91: Trend in the number of Russian tour operators, by market served, 2010-14
Outbound travel to Turkey down sharply in 2015
All-inclusive and free Wi-Fi
Outlook
Inflation is sapping purchasing power
A quiet New Year holiday
More people can only afford necessities
Shorter trips to save money
But domestic tourism is booming…
Destination trends
Crimea could lose tourists
FRANCE
Figure 92: Departure rate (at least one night spent away from home), 2013
Figure 93: Personal trips by French residents, 14 years of age & older, 2013
Booking channels
Figure 94: Booking channels used in France, 2013
Figure 95: Trips, overnights of French outbound travel by main destination, 2013
ITALY
Sharp drop in tourist trips
Figure 96: Total trips by Italian residents, % change with 2008, 2008-13
Figure 97: Trend in Italian holiday trips & overnights, by length of stay, 2011-13
Spain and France the leading country destinations
Figure 98: Destinations of Italian holiday trips, by length of stay, 2013
Accommodation and transport
WHAT NEXT?
MACRO FACTORS FAVOUR TOURISM IN EUROPE
Stronger economic growth in Europe to boost leisure travel
Weak Euro good for incoming but could impede extra-regional outbound travel
SHARING ECONOMY TO INCREASE IN IMPORTANCE
THE CHINA FACTOR
Figure 99: Chinese arrivals in European countries during the first 10 months of 2014
Chinese investment
INDEX TO TRAVEL & TOURISM ANALYST
Index grouped by geographic area
INDEX TO TTI DESTINATION REPORTS
Country reports
SPECIAL REPORTS INDEX
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015

The European Leisure Travel Industry - September 2015

“The impact of the so-called ‘sharing economy’ on Europe’s tourism industry is only in its beginning stages. One near certainty for the future of Europe’s leisure tourism sector is that China will play an increasing role – both as a source market, and as a source of investment capital.”

This report looks at the following areas:

What is the outlook for spending on leisure travel and tourism in Europe?
Who's innovating in the European leisure travel industry?
How is the holiday hotel market in Europe and North Africa structured?
Is cruising still a growth market in Europe?
Who are the key players in Europe's leisure travel industry?


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