Inbound operators in price freeze
Operators will have to cap prices to maintain demand and compete in a tough trading environment, says European Tour Operators Association (ETOA).
In a survey of its members, ETOA found there was optimism for 2005, with operators and hoteliers predicting a 12% increase in volumes on average.
However, most operators and hoteliers predicted spending will remain at last year’s levels, which includes outlay on holidays and money spent whilst abroad.
Speaking at a press conference during the ETOA annual Hoteliers Marketplace, executive director, Tom Jenkins said prices charged by operators continued to stagnate below 2000 levels.
He said: “Operators discounted heavily in 2002 and gouged any suppliers left standing, obtaining big reductions and passing them onto consumers.
Even in the most bleak circumstances, if you come up with a low price people will buy it.”
Mr Jenkins used the example of a package offered by one of his members to the US market for a seven-day trip to Dublin for $299 including flights shortly after the September 11 terrorist attacks.
“He sold out in less than a week,” said Mr Jenkins. But prices have still not recovered, said Mr Jenkins.
“You stimulate demand with low prices like operators did in 2002, but it takes years to get prices back.
Members that put prices up won’t get the business,” he said.
The survey also revealed that for operators and hoteliers, while terrorism continues to be a threat to levels of Europe’s inbound tourism, around 40% of ETOA’s members thought the weak dollar was more of a threat, luring Japanese tourists to the US and keeping US nationals out of Europe due to the inhibitive exchange rate.
Report by Ginny McGrath
Ginny McGrath
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