Study warns of slow recovery of UK outbound

Study warns of slow recovery of UK outbound

The UK’s outbound tourism industry is not expected to resume growth until 2012, according to a new study from Euromonitor, with package holidays leading the recovery due to their value-for-money and protection they provide customers.

During the economic crisis of 2009, outbound tourism flows from the UK slumped 11.8% compared with the previous 12 months, reveals the report. It predicts a further fall of 6.2% in 2010, with another drop of 1.6% expected in 2011.

Positive growth figures return in 2012, although in volume terms the UK outbound industry will remain far below pre-crisis levels amounting to a loss of 13 million outbound travellers over the course of four years. An improvement of 2% is predicted in 2012 followed by 2.5% the following year. However, growth then slows in 2014 to 1.5% to reach 57 million departures.

The macro-economic trends which drove the double-digit decline in 2009 are still relevant for 2010, Euromonitor International said, with unemployment the major concern for Britons. It added that package holidays, which fell by 7% during 2009, would remain popular because of the value-for-money and protection they provide customers.

While many destinations remain expensive because of sterling’s weakness, domestic tourism within the UK also dropped in 2008/9 although at a slower rate than previously.

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Euromonitor International suggests the unpredictable weather is a negative for the domestic sector, although any recurrence of the Icelandic ash cloud in the run-up to the peak season may persuade more people to holiday at home.

“The current crisis with the euro, however, may tempt some cash-strapped holidaymakers to take advantage of the stronger pound once the World Cup is over,” said Head of Travel and Tourism Research, Caroline Bremner.

The results were released at today’s WTM Vision in London, a mini-conference for senior travel and tourism executives, organised by World Travel Market.

World Travel Market Chairman Fiona Jeffery said: “The UK outbound industry was severely hit by the global crisis, as these figures reveal. UK-based operators need to ensure that their pricing and product mix reflects the current climate. There is also a business opportunity for innovative tourist boards and governments to make their destination attractive to British companies and travellers with incentives and support.”

The UK experience reflects a global trend picked up by the report which predicts a “multi-speed” recovery, with tourism in established economies, such as the UK, recovering more slowly than emerging economies. Over the next two years, India and China’s outbound tourism sector will increase by 8-10%. The leading old world economy is Canada, where departures are tipped to increase by 3-4% over the same period.

Overall, the global travel and tourism industry is not predicted to recover to pre-crisis 2008 levels until 2012. Furthermore, tourism receipts will not return to 2008 levels until 2013 with the hotels sector not recovery until 2014.