One in three Britons will cut holiday spending as cost of living rises | Travel
One in three holidaymakers will cut back on holiday spending next year, seeking cheaper all-inclusive packages due to the cost of living crisis, according to travel industry research.
Travel association Abta said a strong recovery in travel demand this year is likely to continue into next year, but its own surveys suggest people are opting for cheaper trips and cutting spending.
Abta said twice as many Britons holidayed abroad in the past year than in 2021, after pandemic travel restrictions were lifted, and accounted for up to 70% of 2019 figures – this which he said was a significant recovery with UK travel restrictions only lifted in March this year. .
According to his research, only 4% of those who have traveled this year have ruled out another trip next year for financial reasons – and 61% of all respondents will take a holiday abroad. But 35% will reduce their spending and opt for cheaper trips.
The research was conducted in late August, before Kwasi Kwarteng’s mini-budget hit the pound and fueled expectations of higher interest rates, rising mortgage costs and a decline in disposable income.
“The current ‘turbulence’ in the financial markets – to use our chancellor’s nonchalant description – is a real cause for concern for our members,” Abta Chief Executive Mark Tanzer said at the Marrakech Travel Convention. .
“Rising interest rates on top of rising energy bills are putting double pressure on businesses – rising costs just as consumers are tightening their belts.”
He added: “Many travel businesses have emerged from the pandemic with less financial headroom than they entered it, so increasing borrowing at higher costs is not an option.”
In its Holiday Habits report, Abta said it noted an increase in the number of people booking through agents or travel professionals in 2022 compared to 2019, after many people suffered problems with canceled trips during the pandemic. There has been a particular increase in demand for such services from families, with more than half of those with young children booking this way.
However, Tanzer said the lifting of UK travel restrictions had “triggered an increase in holidays abroad, with almost twice as many people traveling abroad in the six months from March to August. 2022 than in the previous six months”.
He said reaching 70% of 2019 levels was “pretty remarkable” after the Omicron restrictions – although 39% of travelers were on a modified or delayed trip.
Tanzer said: “We now face an uncertain year given cost of living challenges, but Abta’s research suggests we should continue to see an increase in overseas holidays next year.”
Richard Singer, chief executive of Ice Travel Group, which includes Travel Supermarket, said the value of holidays booked on price comparison sites had fallen by around 20% since the start of the year. As holidaymakers cut back on spending – and Turkey suffers from worse inflation than the UK – he said: “It’s no surprise that Turkey is the fastest growing destination.
Several industry bosses said customers are increasingly looking for all-inclusive holidays, as well as budget packages, to minimize spending abroad with unfavorable exchange rates. Alistair Rowland, managing director of Blue Bay Travel, said: “They’re protecting their exposure – but they’ll walk away anyway.”
Garry Wilson, managing director of easyJet Holidays, said: “People traveling with their children don’t want to have to watch their money all the time. Kids want water parks, it’s $50, ice cream, it’s €50… at these all-inclusive hotels, that’s the set price.
Abta said the top destinations next year would revert to 2019 favorites, primarily Spain, followed by France, Italy and the United States.
Tanzer added that he believes the appetite for travel has “not been dampened by the pandemic – in fact, it may have been heightened”.
“While we may have taken unhindered international travel for granted, we now know what a precious gift it is,” he said.