Published on Monday, February 13, 2012

Online travel giant reveals plunge in flight sales


Online travel giant Expedia saw a 10% increase in bookings during the fourth quarter of last year compared with the same period of 2010, primarily driven by a 19% rise in hotel bookings. However the company revealed a sharp drop in flight sales during the last three months of the year.

It said its bed bank, Expedia Affiliate Network, Hotwire and Egencia showed strong performances up to the end of 2011, but flight sales were down 8% due to an average 10% increase in fares.

Expedia, which span off its travel review site TripAdvisor into a separate entity last November, saw a 7% increase in domestic bookings and a 15% rise in international bookings during the fourth quarter to December 31.

Gross bookings for the whole year were up 12%, following an 18% rise in hotel bookings and a 5% increase in the average daily rates. Average air fares were up 11% year on year, but sales fell back 8% as a result.

Overall, Expedia's revenue grew 7% for the fourth quarter. For the year, it was up 14%. Hotel bookings accounted for almost three-quarters of its worldwide revenue while flight sales made up just 9%

By Linsey McNeill

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Undercutting is not for the long-term. Demise of volume players.

The recent insolvency of Low Cost Travel Group, one of the large players in the travel industry had a big impact on the travelers, hotels and all related players from both wholesale & retail arms. There were about 27,000 people on a holiday who had booked through the company comprised of a €200 million wholesale arm and €500 million OTA / retail arm.