Travel agencies are fighting their way out of the crisis

Travel agencies are fighting their way out of the crisis
Travel agencies are fighting their way out of the crisis

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The situation for travel agencies has improved noticeably this year. “Despite the very difficult Corona years, the industry has come through the crisis quite well,” summarizes Gregor Kadanka, travel agency spokesman for the Chamber of Commerce. The number of business licenses has fallen by around 7 percent in recent years. “But there can be no talk of travel agencies dying out.”

  • Also read: FTI bankruptcy makes travel agencies sweat

There have been many mergers and consolidations. Small businesses have not found successors here and there. “What has not happened are spectacular bankruptcies – the industry has shown itself to be very resilient,” says Kadanka.

This year it has become clear that the desire to travel “is back, has become stronger again”. For the first time since the pandemic, customers have “booked significantly earlier” for this year, starting with December 2023 and January 2024. Last year they only stormed the travel agencies from March onwards. “This year we have returned to the booking behaviour before Corona,” said the tourism expert.

“Demand shock”

This “demand shock” from last year is not happening this year. In 2023, demand for travel suddenly increased in March – “and the tour operators had no capacity on the market.” This year, the industry was already prepared for this, the supply was larger. “This year was the first normal year after Corona – that took a really long time,” the industry spokesperson looked back. “2020, 2021 and 2022 were ‘hardcore’ and in 2023 it was not quite over yet.”

Prices have also been “very different this year, but have risen nonetheless.” While vacation trips taken by Austrians at home and abroad would have become up to 20 percent more expensive in 2023, the increase this year was 4 to 5 percent, estimates Kadanka. “That roughly corresponds to general inflation.” Personnel costs, energy prices and interest rates have risen the most. As a result, travel has also become more expensive. Austria was “one of the leaders in inflation” in an international comparison. “Of course, that made the framework conditions more difficult.”

Positive mood

Despite strong demand and high prices, travel agencies are not yet completely out of the woods. “We assume that the sales figures from before the crisis will be reached again this year – but not the number of passengers,” admitted the chairman of the Association of Travel Agencies in the Austrian Chamber of Commerce. According to a survey of WKÖ members, two thirds, i.e. the majority of companies, expect an increase in sales this year compared to 2023, “sometimes even noticeably,” said Kadanka. Just over half expect an increase of 10 to 20 percent, but only nominally. The immense inflation of the past few years is not taken into account. “Two thirds are very or rather satisfied with the development,” summed up the association chairman.

According to a WKÖ survey, 50 percent of travel agencies expect sales growth for 2024, especially for the summer, a quarter expect the figures to remain the same, and less than 20 percent see a decline.

Popular classics

The most popular destinations for domestic travel agency customers in beach tourism this year are Austria, Croatia and Italy. According to bookings, they are followed by Germany and Slovenia. On short-haul flights, holidaymakers are flying to Greece, Spain and Turkey this year, and on long-haul flights to Thailand, the Maldives and the USA.

According to the Albanian Chamber of Commerce, the country experiencing the strongest growth in arrivals worldwide. This “trend destination”, which has only been developing for a few years, is of course starting from a low level.

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