TUI Group has revealed a sharp slowdown in summer holiday demand from British travellers as the conflict in the Middle East fuels uncertainty and forces holidaymakers to rethink travel plans.
Europe’s largest tour operator said UK summer bookings have fallen by 10pc, with consumers delaying decisions, switching destinations and showing increasing caution over overseas travel.
The company also disclosed it has suffered a combined €61m (£53m) financial hit from the Iran conflict and hurricanes in Jamaica, as geopolitical instability and extreme weather disruptions weigh heavily on the travel industry.
Tui said revenues from its tours and airline business for the summer season were currently down 7pc overall compared with last year, with the UK market proving particularly weak.
The group blamed the deterioration on shifting consumer behaviour following the outbreak of conflict involving Iran, Israel and the United States earlier this year.
Holidaymakers have increasingly moved away from destinations in the eastern Mediterranean in favour of perceived safer locations in the western Mediterranean, while many customers are booking trips far closer to departure dates.
Tui also pointed to intensifying competition across the travel sector as firms battle for more hesitant consumers.
Despite the disruption, the company said Spain — including the Balearic Islands and Canary Islands — alongside Greece remained the most popular destinations for summer bookings.
The travel giant had already warned last month that the Iran conflict alone had cost it around €40m after it was forced to repatriate roughly 5,000 passengers from cruise ships stranded in ports in Abu Dhabi.
Tui said the affected ships have now safely departed during a temporary pause in hostilities and are expected to begin Mediterranean summer itineraries from mid-May.
The company was also hit by approximately €21m in losses linked to hurricanes that struck Jamaica late last year.
Despite the turbulence, Tui reported an improved first-half performance overall, posting an underlying operating loss of €111m compared with €156m a year earlier.
However, the group lowered its expectations for the full year, forecasting operating profits of between €1.1bn and €1.4bn — well below previous guidance of €1.5bn to €1.6bn.
Sebastian Ebel said geopolitical tensions meant the company would need to remain highly flexible in the months ahead.
“Due to geopolitical challenges and dynamic market conditions, it will require great dedication and flexibility,” he said.
“We offer our customers a high level of security and quality, especially in turbulent times. Package holidays remain the gold standard.”
The warning adds to growing evidence that escalating tensions in the Middle East are beginning to ripple across the wider consumer economy, affecting everything from travel demand and airline schedules to energy prices and household spending.
Leave a Comment