Thomas Cook flags a challenging summer ahead as terrorist attacks in Turkey, Tunisia and Egypt put off holidaymakers

 
Catherine Neilan
Follow Catherine
TURKEY-BLAST
The area near Istanbul's Blue Mosque was targeted back in January (Source: Getty)

Thomas Cook has said its summer bookings for 2016 will come in below last year's levels, as holiday-makers are put off "certain key destinations".

The figures

For winter 2015/16, bookings in the UK are down three per cent, while Continental Europe is down eight per cent. Northern Europe was up four per cent, but its German airlines arm was down two per cent. Bookings as a group are down three per cent, with 90 per cent sold, Thomas Cook said.

Average prices have risen, however, up three per cent, as the company focuses more on long-haul holidays.

Looking ahead to the summer, the peak time is just 40 per cent sold - two per cent lower than this time last year.

Why it's interesting

Terrorism is having an undeniable knock-on effect on Thomas Cook's results, as consumers either postpone booking their holidays to the last minute or changing destination completely.

The holiday operator said it had seen "a marked shift in demand, with significantly lower bookings than last year to Turkey", as well as Tunisia and Egypt - all three of which have been targets for recent terror attacks - with higher bookings to Spain, other European and major long haul destinations including the USA and Cuba.

The business has rebalanced capacity in anticipation of this trend, and said it had been able to meet demand for holidays in the Western Mediterranean and long haul destinations at higher average selling prices and margins, offsetting the impact of declines in other markets.

What Thomas Cook said

Chief executive Peter Fankhauser said: "Thomas Cook continues to operate in a volatile market environment. We know that customers want a summer holiday but we can see that some are leaving it later to book this year as they consider their options.

"Against this backdrop I remain confident that we are doing all the right things as a business. It's clear also that customers value packaged travel more than ever and feel safer in our hands.

"The early actions we took to move flights away from Turkey, Tunisia and Egypt have positioned us well for increased customer demand to resorts in the Western Mediterranean, with strong sales to the Canaries, Balearics and the Spanish mainland in recent weeks. We have also seen an increase in sales to long-haul destinations such as the USA and Cuba as customers look further afield for their holidays.

"In addition, we remain focused on delivering our strategy for profitable growth. Sales to our own-brand hotels have continued to increase while customer satisfaction is significantly up across all our markets. I am particularly pleased about this given the huge amount of work that our people have put in across all areas of the business. I am confident that, in spite of the current market conditions, the actions we are taking to implement our strategy will continue to deliver improved results."

In short

Thomas Cook is adapting itself during uncertain times prompted by terrorist attacks, but the market is still challenging.

Related articles