Belfast Telegraph

Cash-strapped travellers save with all-inclusive trips

By Peter Cripps

The owner of Thomson and First Choice has reported a rise in sales of all-inclusive holidays as cash-strapped consumers look to save money.

TUI Travel said more holidaymakers were opting for packages that included meals, which are perceived as offering better value. They accounted for 46% of its sales so far in 2011, compared to 44% the previous year.

The number of summer holidays booked by UK customers was down 2% since its last update in May, but the company said this was a "particularly pleasing" performance given the weak consumer sentiment. And its average selling price was up 4%, driven by the rise in all-inclusive deals.

UK consumers have been cutting back on holidays in recent months amid the financial gloom. Rival Thomas Cook has warned on profits three times in the past year and chief executive Manny Fontenla-Novoa resigned earlier this month.

TUI's overall sales in the three months to June 30 were up 13% to £3.8bn while underlying profits rose 57% to £88m, as it benefited from the later Easter this year.

The group also benefited from weaker comparatives against the previous year when flights were disrupted by the Icelandic ash cloud.

As well as choosing more all-inclusive holidays, UK consumers are also reducing the length of their getaways to save on cash. The firm reported a 24% rise in 10 or 11-night stays, while one-week trips were up by 4%.