Sales increasing fast for TUI as Covid crisis eases

Despite the pandemic, appetite for a week in the sun doesn’t appear to have disappeared based on the latest update from travel operator TUI.

For a while some of the optimism from the travel sector has felt a bit forced, like companies couldn’t even contemplate another summer of disruption.

“Airlines and traditional travel operators like TUI have significant fixed costs so when they aren’t getting any cash from holidaymakers, losses and debt can mount quickly,” said AJ Bell’s Russ Mould.

“For all the concerns over TUI, there’s an argument in Germany that the company is seen as ‘too big to fail’, having been bailed out by the German government three times so far during the pandemic and received almost €5 billion in state support.

“And despite the complications and continuing restrictions it does appear people are willing to put up with Covid tests and periods in isolation if it means you can enjoy a cocktail on the beach or a dip in the Med.

“A preference for all-inclusive holidays makes sense, as it will probably be perceived as a safer option by tourists and the good news for TUI is it can charge more for these breaks.

“A more normal summer might be possible by 2022 and TUI is seeing bumper bookings for next year, and simply by surviving it could thrive if smaller rivals fail.”