The tourism industry welcomes Dr. Leo Varadkar, the newly appointed Minister for Transport, Tourism and Sport, as well as the new Junior Minister for Tourism and Sport, Michael Ring T.D.
The Programme for Government contains several measures of importance to the tourism industry, not least the abolition of the air travel tax provided the airlines reciprocate with additional services.
The Tourism Opportunity campaign, led by ITIC and the IHF together with a broad business coalition, proved very effective in getting the actions urgently needed for a return to growth on the political agenda.
The Tourism Recovery Task Force is set to work with Government and the state agencies on the implementation of those measures which will not only turn tourism around but also contribute to Ireland’s economic upturn by earning increased revenues and creating new jobs.
As always, your comments are most welcome on email@example.com.
|CURRENT MARKET CONDITIONS & OUTLOOK|
|The short-term outlook for travel from each market is based on the best current information available, including economic and other factors influencing demand for travel. The summary presentation, depicted in weather symbols, is intended as a guide to marketers. The monthly series is also intended to highlight any change in market outlook from month to month.|
|Oil prices threaten tourism growth|
|Political upheaval in the Middle East and North Africa has driven the price of oil to a two year high. With the price of Brent touching $120 a raft of fuel surcharges are being levied on airline tickets and package holidays.Fuel surcharges are back. BA/Iberia, Delta, Qantas Airways, and Singapore Airlines are amongst those airlines which have already increased fuel surcharges, especially on international routes, to offset higher oil prices. Thomas Cook and Tui brands Thomson, First Choice and Thomson Airways are hiking prices in the UK an attempt to claw back rising fuel costs.More serious is the impact of rising fuel costs throughout the economies of developed nations, pushing up the cost of living, reducing disposable incomes as well as pushing up the cost of travel.|
|British market still a challenge|
|The rate of UK unemployment in the three months to December stood at 7.9%, while GDP is now estimated to have contracted by 0.6% during the final three months of 2010. It is probable that the first three months of 2011 will see a bounce-back as postponed activity gets underway, but there remain concerns that the retail sector will feel the pinch from higher VAT rates, while higher APD and fuel surcharges will dent demand for overseas travel. The impact of the budget and job lay-offs in the public sector are likely to impact northern areas more than the more prosperous London and South East region.The challenge facing Ireland in reversing the loss of market share from the largest source market is great. While British residents made just under 55 million overseas visits in 2010, a 6% reduction on the year before and a drop of one fifth from the peak year of 2006, Ireland has suffered a bigger fall off in demand. Four out of five trips that UK residents take abroad are to a European destination, a market which declined by 7% last year and two in every three overseas trips are for a holiday, a segment which dropped 6% in 2010. Domestic tourism demand in the UK up to October 2010 was down 2% in volume and 4% revenue.|
|European Economic News|
|While Eurozone economic growth in the final quarter of 2010 was slightly lower than expected, the recovery has started to broaden out. Exports are triggering a pick-up in domestic demand, which is expected to gain momentum. The investment cycle is expected to gain more strength in the second half of 2011 and beyond, also aided by the high level of business confidence. Consumer spending looks set to increase, as labour market conditions improve and the unemployment rate continues to decline. However, the recovery looks set to remain unbalanced, with the core countries, particularly Germany, France and some nearby economies, providing the impetus to growth in contrast to the struggling peripheral economies. Inflation is creeping higher but the ECB has signalled an interest rate hike from April onwards.|
|Travel demand indicators for the stronger economies continue to be positive, pending the impact of higher oil prices.|
|Encouraging news from the Domestic Market|
|The 1.2 million people in Ireland aged over 50 are far more likely to splash out on holidays, new cars, restaurants and home improvements than any other section of the population. This is the latest findings from Amárach Research based on a survey of 500 adults over 50.The over 50 cohort has been the main driver of growth in demand for travel over the past decade. Over-50s claim to be happy, relatively affluent and upbeat about their personal futures while more than two-thirds say the recession has not had a major impact on their lives. While 71% said they had seen their income decrease significantly over the past 12 months, two out of three claimed the recession had not had a strong impact on their lives and a similar number said they had not made any drastic changes to their spending throughout the downturn.|
|Positive outlook for US travel, but could be threatened by rising oil prices|
|US consumer confidence improved further in February, before the recent sharp rise in oil prices, taking the index to a three-year high. More Americans plan to travel and spend more money in 2011, despite high unemployment and a slow recovery, according to the latest report from Travelocity.com. Advance bookings for Europe and Ireland reported by tour operators also point to growth in 2011.35% of consumers surveyed by the travel website said they will increase their travel this year. More than one quarter of those surveyed said they would spend US$2,000 or more on their vacations this year, which was up from 20% in 2010. More than one third said they will spend more than last year.However, ticket prices for air travel are on the rise, with domestic and international airfares up by double digit percentages in 2010, according to the Bureau of Transportation Statistics. The recent crisis in the Middle East driving the price of crude higher has seen airfares rise again. At some point, the higher oil prices may start to eat into discretionary income levels and that could, in turn, start impacting the demand side of the equation. In his twice-yearly report to Congress, the chairman of the Federal Reserve, gave warning that surging prices in oil and other commodities could hamper America’s economic recovery, but said he did not anticipate a big rise in inflation.|
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|On the currency markets the euro strengthened a little in February against the US dollar, while remaining unchanged against sterling.
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|Update on Air Services – Summer 2011|
|Announcements of additional services within the past few weeks include:Aer Lingus Regional: Rennes to Cork, weekly summer service from May 14th
|Southend becomes Aer Arann’s main London Airport|
|Aer Arann will operate double daily flights from Galway and Waterford to Southend from March 27, in addition to maintaining service to Luton on four days a week. Stobart Group, owners of Southend Airport, invested in the restructuring of Aer Arann. Access to central London from Southend Airport is by train to Liverpool Street, calling at Stratford (for Docklands and Canary Wharf).|
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|TOURISM TRENDS & NEWS|
|Irish hotel rates are not the only ones coming down|
|Hotel rates across Europe fell in 2010 for the second consecutive year, with a drop of over 10% in some cities, according to a survey by Hogg Robinson Group. Athens, Lisbon, Madrid and Dublin were amongst the cities with the biggest drop in rates.The UK appears to have bucked the trend across Europe with London rates rising as corporate demand returned and overseas leisure travel increased due to the weakness of the pound.
Moscow was the most expensive city for a hotel room around the globe – for the sixth consecutive year it had the highest average room rates.
|‘Grandparents Stay Free’ – don’t miss the multi-generational travel market|
|A hot trend in travel is the increase in the number of family holidays involving three generations. In many cases the grandparents are paying for their children and grandchildren. New technologies, lifestyles and a tight economy are spurring the trend.At least five million family vacations a year in the US now involve multi-generations holidaying together, according to estimates from the US Travel Association. Almost one-third of US grandparents who took vacations last year went with their grandchildren, up from 22% as recently as three years ago. That number is expected to grow as the US population ages. The cruise lines, hotel chains and leading travel operators, including Virtuoso, VacationWired.com, American Express and Tauck, are responding with tailored programmes catering to this emerging segment.The trend is also beginning to emerge on this side of the Atlantic, with increased incidence of multi-generational trips being reported from the British market.
‘Grandparents Stay Free’ campaign from the Hodson Bay Hotel is cashing in on an emerging market opportunity.
|European online players unite to challenge global OTAs|
|France and Spain may not jump to mind as hotbeds of travel e-commerce innovation, but two of Europe’s leading online travel agencies (OTAs) – GO Voyages and eDreams – are now joining forces to acquire Opodo. The deal, pending approval, could see the three OTAs merge to form a powerful pan-European player to challenge the global brands such as Priceline and Expedia. It is unclear at this time if they will merge into one branded OTA or maintain separate identities. GO Voyages is almost up on Lastminute as top OTA in France, while eDreams is market leader in Spain, both relatively immature markets in terms of online bookings with healthy growth prospects.|
|UK Government tackles visitor visa issues|
|The visa application process for visitors to the UK should become easier, under the UK Government’s new tourism policy announced last week. It plans to share visa application centres with trusted allies, like Australia and the US, so that they are easier to travel to. It is also looking at introducing a simpler application process for ‘low risk’ applicants. The Government is proposing to increase the uptake of online applications to 90% by 2012. The policy also outlines steps to improve the welcome for visitors through more automation and pre-clearance at border controls and improvements at airport terminals.Visa requirements and application processes for intending visitors to Ireland continues to be a barrier to visiting the country and a common visa policy with the UK would be a great benefit to Irish tourism.|