winter sales prediction, largest travel company, Omicron variant

Omicron Reduces TUI’s Winter Sales Prediction But Hopes For A Comeback In Summer 2022

TUI announced an operational loss of over 2 billion euros ($2.26 billion) for the fiscal year 2020-2021. Owing to the surfacing of the Omicron coronavirus strain, the travel firm has opted to reduce its winter capacity projections, casting doubt on the possibility of a recovery any time soon.

Since pandemic restrictions wrought mayhem on the tourism and hospitality sector from March 2020, the world’s largest vacation firm has suffered, with its hotels, flights, and cruises mainly vacant.

A Fiscal Year With The Worst Results

TUI’s total earnings for the fiscal year were €160 million. Compared to the year-ago losses of €836 million, pre-tax losses for the three months ended September 30 were €71 million.

TUI had reported a total loss of more than €2 billion, owing to the influence of coronavirus limitations for most of its fiscal year. Winter reservations were also very low, but TUI was anticipating a comeback with summer 2022 sales.

Annual winter sales declined to €4.73 billion from €7.94 billion the previous year. TUI had obtained financing from the German government and had laid off 30% of its staff recently. After announcing a €2.5 billion profit, down from a €619 million profit in 2019, it issued a caution to investors.

TUI also stated that it had reached its pre-crisis level of 69%, with 93% reservations in the first quarter.

A Hold In Winter Sale

Fritz Joussen stated at the press conference that with the new spread variant, it is apparent that there will be a booking hindrance for this winter. As a result, TUI stated that it might have to limit its winter schedule to the least part of its guideline. Depending on the fourth wave of the pandemic and likely governmental changes owing to the Omicron variant, it would function at 60-80% of 2019 capacity.

Hopeful Summer 2022

TUI’s CEO, Fritz Joussen, expressed optimism, adding that the company has extremely solid cash inflows and is on the favourable side of the market in terms of hotel brands. TUI also has travel companies, hotels, airlines, and cruise ships under its umbrella. It had 4.1 million reservations for the upcoming winter and summer together.

Based on reservations thus far, TUI estimates a complete comeback with booking levels comparable to summer 2019, as the travel situation improves with increasing vaccination rates.

TUI had 90% of pre-pandemic level bookings for Easter, with maximum bookings by the United Kingdom. It also announced 2.2 million summer bookings, which is 535,000 more than the previous month’s statement.

Takeaway

However, because of the unpredictable travel environment and its influence on customer behaviour, it is hard to anticipate the new fiscal year 2022 as the pandemic progresses.

TUI has also announced that the advance release of its summer schedule has resulted in the UK being fully booked up to half full in advance for May. With this rate of bookings, TUI will almost certainly have a big comeback in the summer of 2022.

Leave a comment

Your email address will not be published. Required fields are marked *