More business, less profit for travel
May 27, 2008
For all the talk about how the credit crunch may or may not be affecting travel, the latest CBI Services Sector survey shows that travel is faring better than other service sectors. This is line with what the likes of TUI and Thomas Cook are telling us.
This is what the survey says . . .
Looking at the sub-sectors, the only consumer services sector to report growth in business volumes over in the past 3 months was travel services. However, these firms incurred rapid cost rises and, with limited ability to pass these onto customers, their profitability fell at the fastest rate for five years.
But there has been a huge slide in profits so costs are a problem for the travel industry even though the demand is there.
NOTE: The survey sample was not big - it was conducted between 23 April and 7 May 2008 and 143 firms responded.
Martin Couzins, managing editor
Nathan Midgley
Martin Couzins
