Package sales defy forecasts by remaining strong in lates market

Package sales defy forecasts by remaining strong in lates market

Growth in package holiday sales has continued into the summer late-booking period, defying predictions that dynamic sales would pick up at the expense of packages.

Industry analyst GfK reported package bookings for the season to date up 4% year on year to mid-June in a market 2% down on last year.

GfK put the market share of packages at 83%.

Sarah Sloman, consumer choices global client director at GfK Retail, said: "The market has been driven by packages at the expense of accommodation-only and flight-only."

Package sales boomed in the first quarter of the year, with GfK reporting bookings up 8% year on year in February.

On Holiday Group chief executive Steve Endacott acknowledged in April: "The major tour operators slowed the growth of dynamic packaging in January to March."

Endacott suggested this would change "in the lates market where full balances are required on booking".

However, weekly package sales were nine percentage points up year on year in the last week of May ­ although GfK figures do not include all the major online travel agents.

One factor in favour of packages early in the year was the major tour operators¹ practice of 'hedging¹ (fixing in advance) exchange rates and fuel prices.

Lowcost Travel Group chief executive Paul Evans noted: "The rates [paid] for currency and fuel made packages very competitive early this year."

But Evans suggested little had changed compared with last year, asking: "Has the total package sector grown? I don¹t think it's any different."

GfK figures showed a small fall in demand for Turkey after weeks of protests in Istanbul, with bookings down 5% year on year in the week to June 15.

However, bookings for the season remain 2% up on 2012.

Greece has fared better at 6% up for the season, but was 13% down in the week to June 15 ­ though with average selling prices £98 up on a year ago, suggesting capacity is tight.

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