Tourism: Tui benefits from the desire to travel – the industry is on the rise

The world’s largest travel group Tui sees itself continuing to grow despite increasing economic concerns. After a jump in profits in the 2023/24 financial year, CEO Sebastian Ebel expects further growth in 2025. The winter season got off to a good start, said Ebel when presenting the balance sheet for the past financial year. And there are already seven percent more bookings for the coming summer than a year ago. And, Ebel added: “Germany is particularly strong.”

Ebel was convinced that the weak economy and worries about the future would not dampen the desire to travel. “We have experienced this again and again, even in economically more difficult situations, that customers want to travel, want to go on vacation.” This can also be seen in the current booking figures: 62 percent of the winter program has already been sold, and the figure for summer 2025 is 17 percent.

Mallorca and Canary Islands asked

Destinations around the Mediterranean are particularly in demand. The Canary Islands are well booked in winter. And: “Mallorca will be full in the summer.” Customers don’t save money either: those who have already booked are currently spending an average of three to five percent more on their vacation than they did a year ago. However, some holidaymakers would also switch to cheaper travel destinations. Instead of Spain, Egypt, Tunisia or Bulgaria will then be booked.

Overall, the industry continues to see growth. “The booking data from the past few months show that holiday demand is also very high for the coming year,” said a spokesman for the German Travel Association. More people have already booked their summer vacation than at the same time last year. Turkey, Spain and Greece as well as cruises are particularly in demand.

There should be no new price jumps

Tourism in Germany also recently achieved a record. According to the Federal Statistical Office, 433 million overnight stays were recorded in the period from January to October. The number was 1.6 percent higher than in the same period last year and just above the previous high for the first ten months of a year, which was 432.3 million overnight stays before the corona pandemic in 2019. Tourism in Germany had already recorded growth over the first three quarters, and there was a record overnight stay in the holiday month of August.

Tui boss Ebel no longer expects further price increases for holidays. “Inflationary pressures have eased,” he said. After the increase in recent years, we have now reached a level that “we think will stay that way.” However, the level is significantly higher than before the pandemic.

FTI bankruptcy reorganizes the market

Tui can make significant gains, especially among German customers. The number of pre-bookings for the coming summer is even 20 percent higher than last year. The bankruptcy of the tour operator FTI, which had to cease operations this summer, also contributed to this. Tui gained additional customers as a result.

“The RTI effect is of course noticeable in Germany,” said Ebel. “But it’s not as big as people always thought.” Even before the previous number three in Germany went bankrupt, booking numbers there had already declined. In addition, the reimbursements from the travel insurance fund took so long that many FTI customers ultimately did not book a new vacation.

Pre-Corona level not yet reached

In the past financial year, Tui counted at least seven percent more tour operator guests than the year before. Nevertheless, the number of 20.3 million guests once again fell short of the 20.6 million from the pre-crisis year of 2019. Ebel thinks it will break this mark in the new financial year by the end of September 2025. “The expectation is not entirely wrong,” he explained. Tui will have already exceeded the level in numerous countries by 2024. In Germany, five percent more trips were sold than in 2019, and in Great Britain even ten percent.

Ebel spoke of a “good and successful” year. Sales rose by twelve percent to 23.2 billion euros in the 2023/24 financial year. Tui shareholders received a surplus of 507 million euros, almost two thirds more than a year earlier.

The pandemic made Tui a need for restructuring

Tui itself became a need for restructuring during the Corona crisis in 2020: the company lost its business because of the travel restrictions. The German state saved Tui from ruin with financial aid. The company has paid back the aid and is making money again. However, the remaining mountain of debt is still too big for the board.

“Our goal remains to become more profitable, efficient and stronger with Tui in all segments,” said Ebel. In the new 2024/25 financial year, group sales are expected to increase by a further five to ten percent. Adjusted operating profit is expected to increase by seven to ten percent.