Price cutting war good news for UK holidaymakers

A new study suggests that UK holidaymakers will be big beneficiaries of a cost cutting war at European destinations this summer.

The Post Office Holiday Costs Barometer suggests that the popular destinations of the Spanish mainland and Portugal’s Algarve have seen local prices cut by 20 percent and 15 percent respectively. The benefits to UK travellers are still apparent, despite the pound being worth almost 5 percent less than it was a year ago.

When compiling its list, the Post Office study took into account the cost of 10 items that holidaymakers are likely to purchase locally. These were a three-course meal, a cup of coffee, a bottle of beer, a glass of wine, a soft drink, bottled water, suncream, insect repellent, cigarettes and a newspaper.

Resorts on the Algarve came out cheapest overall at £46.34, but the Portuguese advantage was slight when compared to Spain’s Torremolinos at £46.50, and Javea on the Costa Blanca at £47.14.

Spain’s islands proved to be more expensive, with Menorca the highest at £88.22, considerably more than Majorca at £55.26.

The cost savings are not only restricted to European destinations. Orlando, Florida has also seen a price reduction of more than 20 percent year-on-year, with the 10 items now costing just £58.16, while Sharm el Sheikh on Egypt’s Red Sea coast has seen a 17 percent reduction to £62.83.

However, cost decreases are not universal, and some destinations have actually increased their prices over last year. Prominent among these was Dubai, with its £103.23 cost not only the highest on the survey, but it also reflected an increase of more than 60 percent year-on-year. The Turkish resort of Bodrum has also seen an increase of more than half, to £90.15.

According to Andrew Brown of Post Office Travel Money, ‘The pound may be worth less in Europe than a year ago but fierce competition means that lower prices in several of the resorts we surveyed can easily offset the falling value of sterling.’