Tui earns record revenue with prices for cruises soaring

Post-pandemic demand for travel appears unstoppable, with Europe’s biggest holiday company revealing record revenue for the first three months of 2024.

A total of 2.8 million customers paid an average of 3 per cent more for their holidays in the quarter compared with a year earlier, taking revenue to €3.6bn (£3.1bn).

The Canary Islands and Egypt were the most popular package holiday destinations between January and March, with demand for Cape Verde – the Portuguese-speaking archipelago off the west coast of Africa “increasing further”.

Demand was particularly strong for Tui’s cruise ships. The average daily rate rose by one-fifth to €221 (£190), while the number of empty cabins fell by three-quarters; on average 49 out of 50 are filled on the company’s vessels.

The quarterly loss fell by 22 per cent to €189m (£162m); Tui traditionally loses money in winter.

With planes flying 93 per cent full, the prediction for the full financial year is that profits will rise by 25 per cent.

Bookings for the summer are 5 per cent higher than 2023, with prices 4 per cent higher despite increasing competition from online travel agents and easyJet’s holiday operation.

“Travelling is very popular,” said Tui’s chief executive, Sebastian Ebel. “We are seeing high demand for package holidays, in particular.”

The company’s results statement said: “Tui continues to closely monitor geopolitical events, particularly in the Middle East and on the Arabian Peninsula.

“Should the situation or customer demand change, the Group’s business model allows it to flexibly shift capacity from the Eastern to the Western Mediterranean.”

The company would, if necessary, shift some of its flights from Turkey to Spain.

But the Tui announcement came hours after a leading tourism figure on the Spanish island of Mallorca said a “strategic plan” was needed to tackle overtourism.

The Majorca Daily Bulletin reports that Maria Frontera, president of the Mallorca Hoteliers’ Federation, said the Balearic Islands are “in a critical situation”.

“Seeking a balance of coexistence between residents and visitors has long been an issue on these islands,” she said.

Tui insists it “operates organised package tourism that does not impact local living spaces”.

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