Tag: Economy

Suspension of cruises to cost UK economy £888 million

According to new data from Cruise Lines International Association (CLIA), the 90-day suspension of cruises will cost the UK economy £888m and lead to the loss of 5,525 jobs and £287m in wages, The Telegraph has reported.

The Association represents more than 95 per cent of the world’s cruise fleet. Across the UK, the cruise industry supports 40,517 direct jobs paying £1.35bn in wages. These are the cruise line employees, both on board and shoreside.

Nearly a fifth of the 435,000 people employed in the businesses supported by the cruise industry across Europe are also based in the UK, paying £3.05bn in wages. These include an extensive supply chain featuring travel agencies, hotels, local transport operators, and port agents, and the industry also supports catering companies, including many small and family-run businesses providing specialist food produce.

Along with indirect jobs, the total predicted economic loss rises to GBP2.37bn, 13,788 jobs, and GBP746m in wages for a 90-day suspension. For every 1% drop in cruising in the UK, CLIA anticipates up to 530 jobs can be lost. Each day of the suspension results in the loss of 55 direct jobs and 139 total jobs in the UK, the report noted.

Andy Harmer, director, Clia UK and Ireland, said: ‘The cruise industry generates £10 billion for the UK economy each year. We understand the significant impact, therefore, that our decision to suspend operations has on the livelihoods of people who work in our sector, and on businesses that rely on the cruise industry in all parts of the country. Unfortunately, our research shows that for a 90-day suspension we can anticipate a loss of more than 5,525 UK jobs and an economic cost of £888 million to the UK.’

‘Choosing to suspend operations was the right thing to do, and we know the cruise industry is resilient. We have put public health at the heart of our response, and we will continue to respect the guidance from international and national health authorities. We are using this time to enhance further our protocols that we will all benefit from, and we look forward to playing our part in the recovery, when the time comes for society to travel once more.’

The report come as both P&O Cruises and Cunard extended their suspension of global operations until July 31 at least. Neither line had ruled out extending beyond that date. They had announced they were starting to shut down operations on March 16.

Thomas Cook Airlines launch long haul economy light fares

Thomas Cook Airlines has announced the launch of ‘Economy Light’ fares on its long-haul routes.

The fares, available with Thomas Cook Airlines in the UK and Condor in Germany, are intended to be competitively priced flights under the scheme. Economy, Premium and Business (Condor only) fares will remain the same, the airline said. Meanwhile, the Economy Light fares from Manchester to New York would start from £299.99 return and Economy, £359.99 return.

Henry Sunley, Commercial Director at Thomas Cook Airlines, said, ‘We wanted to ensure that we provide fares that support the different needs of our customers, which can differ from trip to trip. Economy Light offers an option for those customers who want less amenities for their journey but want to benefit from fantastic cost savings.

‘They are the first fares that we have introduced on a pan-European scale across Thomas Cook Group Airline for our seat-only business.’

Economy Light fares include a 6kg cabin bag as well as a personal item (such as a handbag). Light fares do not include any hold baggage and check-in is online only. The on-board experience remains the same for all Economy customers, as people will receive signature James Martin meals and inflight entertainment.

Economy Light fares will be available online at thomascookairlines.com and through participating retailers for selected long-haul flights from November 1, 2018. Customers can expect fares such as Manchester to New York return from £299.99 return.

In addition, Thomas Cook Airlines in the UK has also introduced a ‘Flex’ option to its Economy fares for customers looking for more flexibility with their booking. Adding Flex turns a non-refundable fare into a flexible ticket that allows cancellations and removes penalties and charges for date and route changes.

The company said: ‘Economy Flex fares have been available with Condor for a number of years and are a great option for business and leisure travellers alike. We believe that our UK customers will welcome the chance to add extra flexibility to their trip if they wish to. With Economy Light and the option to add flexibility with Economy Flex, we are providing more choice than ever for our customers.’

Birmingham Airport backs second runway at Gatwick

Birmingham Airport has announced its support for a second runway at Gatwick Airport.

A second runway at Gatwick is among the options short-listed by the Airports Commission for the UK’s next runway. The CEOs of the two UK airports delivered their joint message at the Conservative Party Conference, calling on the Airports Commission that any new runway developments would promote competition and choice across the UK.

Speaking after the event, Birmingham Airport CEO Paul Kehoe said: ‘Passengers and businesses tell us they want to fly direct. With our region attracting over a quarter of the UK’s foreign direct investment, we are clear that the answer is a network of national long-haul airports, plugging all regions into global growth opportunities.

‘Growth at Gatwick will support demand for greater connectivity, improving value for passengers flying from the South East and supporting the continued growth of our regions.’

Stewart Wingate, London Gatwick CEO, added: ‘Competition between the UK’s airports is essential for delivering choice for passengers, businesses and investors across the country. By expanding Gatwick we can harness the strength of the country’s network of great airports, delivering new South East capacity and supporting the growth of connectivity across the UK.

‘This is why we are delighted that Birmingham Airport is supporting our case for a second runway.’

The announcement comes as Gatwick Airport launched its regional road-shows at Chambers of Commerce throughout the UK, outlining how a second runway would offer improved connections for UK businesses, benefiting the economy. Over the next six weeks, Gatwick will visit nine Chambers of Commerce throughout England, Scotland and Wales to discuss the airports capacity debate and the key issues for UK businesses.

 

Political inertia over third runway at Heathrow increasing ticket prices, study

Political inertia over the need for a third runway at Heathrow, the UK’s only hub airport, is increasing ticket prices for air travellers, according to independent research by Frontier Economics.

While demand has increased over the years, Heathrow has been unable to add more flights for a decade – pushing up prices. According to the new report by Frontier Economics, passengers travelling through Heathrow are already paying an average of £95 more for a return ticket than they would do if Heathrow had a third runway.

The un-met demand is expected to increase in future, and Frontier Economics estimates that by 2030 the average return ticket price could be £300 less with Heathrow expansion than with a two-runway Heathrow.

Colin Matthews, Heathrow’s Chief Executive, said: ‘This research shows that not building a third runway at Heathrow will add hundreds of pounds to the cost of a family holiday, be a disincentive to doing business in the UK, and increase the cost of the goods and services that are imported and exported through Britain’s most important trade gateway.

‘This additional burden on both the cost of living for families and on businesses is entirely avoidable. The private sector stands ready to invest in the infrastructure Britain needs. Government has it within its power to lower prices for consumers by taking a clear decision to support expansion and end the years of prevarication that are now causing fares to rise and routes to be constrained.’

The Frontier Economics’ study also claims that a third runway will create a greater choice of routes for passengers. Expanding Heathrow could add 40 new direct connections to London in total, with many of those routes going to destinations in rapidly growing economies such as Calcutta, Lima and Mombasa.

Additionally, Heathrow will also work with government and airlines to ensure that expansion delivers improved air links between Heathrow and other parts of the UK including Inverness, Liverpool, Newquay and Humberside, the airport said.

In comparison, adding a second runway at Gatwick would reportedly only add between five and seven new routes, mainly to package holiday destinations.

However, the report argues that there would be even greater benefits to passengers if both Heathrow and Gatwick were allowed to expand, since having spare capacity at both airports would allow the greatest scope for competition.

 

UK urged to increase night flights to speed up economic recovery

The British Shippers’ Council (BSC) has urged the UK government to expand the number of night flights from Heathrow, Gatwick and Stansted Airports as the UK economy continues to recover and freight volumes grow again.

The BSC, part of the Freight Transport Association (FTA), said that the move was necessary ‘to remain competitive in the global marketplace.’ The advice came after its recent meeting with the Department for Transport about its second stage consultation on night flying restrictions at Heathrow, Gatwick and Stansted, which sets out proposals for the period from October 2014, to October 2017.

A BSC statement said: ‘Not to do so would negatively affect use of the airports and damage the quality of the UK international supply chain.’

The statement added: ‘Unless there is flexibility this is likely to restrict potential air freight shipments, undermining the reliability and predictability of UK supply chains faced with fierce competition from continental competitors.

‘Demand is driven by customers from across the UK economy, for example in pharmaceuticals and advanced manufacturing, and these companies need to move their time-critical or high-value goods quickly and efficiently.

Commenting on behalf of the British Shippers’ Council, the FTA’s Chris MacRae said: ‘Night flights are an essential component in maintaining the UK’s international economic competitiveness. Operators don’t provide them by choice but driven by shipper demand, itself driven by end customer requirements. It is good news that the current regime is not proposed to be further restricted, but at the same time as the economy grows some easing of restrictions would be appropriate.’

The outlook for the British economy has improved by more than any other developed nation over the last six months, the Organisation for Economic Cooperation and Development (OECD) said in November. The international watchdog said that it expected the UK economy to grow by 2.4 percent in 2014, compared to 1.4 percent in 2013.

Frugal Brits economise on holidays

A survey has revealed that British holidaymakers are cost conscious when it comes to booking their annual getaway, spending an average of just £554.40 per person.

Carried out by holiday booking company, Teletext Holidays, the survey also discovered that many British tourists spent well below the average, with 45 percent of those that responded having spent less than £400 on their break, while only 17 percent spent more than £800 per person.

The survey also investigated the aspect of the holiday that respondents found most exciting. Just under 33 percent said that it was travelling to their holiday destination that they found most exciting, with around 20 percent being most excited by the booking process. 10 percent said that the most exciting aspect of the holiday was researching where to go.

Predictably, there were differences highlighted in the holiday booking habits of men and women. Men were less inclined to book well in advance, preferring to wait until late on in the hope of getting a bargain. Women, on the other hand, were far more likely to book their ideal holiday as much as a year in advance.

Amy Patel, from Teletext Holidays, told the Daily Mail that it is still possible to save money even when booking late. She said, ‘There are deals to be had right up until the last minute and we’d encourage those people who would typically book well in advance, to keep their eyes open for last minute offers too.’

In an ominous verdict on the travellers’ perception of the holiday industry, almost a third of respondents to the survey said that they felt that they were being ripped off when booking a holiday.

 

Senior economist stresses importance of tourism to UK growth

A senior economist has spoken of the importance of tourism to the UK’s economic recovery.

Andrew Sentence, a senior economic advisor at London-based PriceWaterhouseCoopers and a former member of the Bank of England’s monetary policy committee, said that tourism was on a par with financial services with regards to driving growth.

Speaking at the British Hospitality and Tourism summit in London on Tuesday, Sentence itemised Britain’s top export-oriented services, estimating tourism, culture and heritage as being responsible for 9 percent of GDP, which puts it on a par with financial services. Only business and professional services at 13 percent fared better in the speaker’s estimation, with IT, communications and software at 5 percent and media, fashion and music at 2.5 percent.

Sentence stressed the importance of tourism in a new growth pattern that the economy would have to adapt to. He said, ‘We’ve been through a serious recession and we’re in a different situation. We’ve come to the end of a long period of expansion and the conditions that dominated it are not likely to return. We’re in an era of relatively slow growth.’

Speaking directly to an influential audience in the industry, he added, ‘You’re not exempt from the ‘new normal’, but tourism and hospitality has a key role to play in driving growth.’

He continued, ‘The UK is forecast to do relatively well this year compared with other European economies.’

Maria Miller, the UK’s secretary of state for culture, also addressed the summit, during which she too stressed tourism’s value to the economy.

Travellers Enjoy Vacations even As Global Economies Slide

While most economies of the world are struggling to make headway against the gloom of recession, miraculously the travel industry appears to be on an upward trend, as global budgets for vacations continue to increase.

A survey, sponsored by the Wyndham Hotel Group, has recently polled around 5,600 adults residing in cities of the US, Brazil, Canada, China, and the UK. According to the survey, 70 percent of the respondents intend to spend a similar budget or more on vacationing in 2012, compared to their budget in 2011, with 35 percent intending to spend more than last year.

Around 66 percent of Chinese travellers and 52 percent of US travellers intend to travel on longer holidays this year, compared to last year, while 37 percent of US travellers, 36 percent of travellers from Canada, and 42 percent of Chinese travellers are planning a vacation with more expensive entertainment and excursion options.

The report also suggested that around 34 percent of travellers claimed to be members of hotel loyalty programmes, with 50 percent of Chinese travellers, 40 percent of US travellers, and 20 percent of UK travellers belonging to at least one hotel loyalty programme. Of the hotel loyalty programme members, around 62 percent claimed that their travel decisions are influenced by their loyalty programme memberships.

Visitors showed a preference for visits to theme parks, with around 43 percent of travellers voting for the parks, while 40 percent voted for shopping destinations, and 37 percent voted for adventure trips, such as mountain climbing and skiing.

Of the travellers that are looking to lower their travel expenditure this year, around 24 percent of them intend to give up their holiday entirely, while others want to cut down on dining out or going out with friends, instead of giving up their holidays completely.

 

Financial climate forces hotel rates down in UK

A global report has revealed that hotel prices in the UK are stagnating.

The research suggests that the cost of a nights stay in a major city hotel can show the country’s economic health.

Growing economies such as Brazil, Russia, India and China have seen prices increase, whereas the UK has seen hotel room prices drop by one per cent.

The capital city is the only place to see  rise in hotel prices, London has seen a rise of one per cent.

London is the only city in Britain to report a rise in hotel prices – a negligible one per cent – set against increases in 69 out of the 88 worldwide locations checked as part of the research.

In a recent survey of hotel rates, by hotels.com, prices varied across Europe. The effects of the Greek economic crisis are evident in hotel prices dropping by around 10 per cent.

In contrast the euro is doing relatively well, popular city-break locations such as Barcelona and Amsterdam have seen rises of 8 and 9 percent.

Thanks to a visit from the US president and the Queen, Dublin have seen a rise in prices.

The Baltic states have also seen a rise with hotels in Lithuania, Estonia and Latvia seeing prices increase.

However the protests seen prices across the Middle East and Africa have seen prices drop.

Australia’s strong economy have seen significant rises, Brisbane saw an increase of 26 per cent in rates, whilst New Zealand’s Christchurch saw the largest increase of 41 per cent in rates.

David Roche, the president of Hotels.com, explained:

‘Price volatility in 2011 meant UK travellers found it more expensive to stay in the majority of their favourite destinations abroad,’ he says.

‘A variety of factors, including currency movements and a growth in corporate travel, pushed up prices at a time when many consumers were already struggling to pay their bills at home.’

Air tax damaging to the UK economy

Removing Air Passenger Duty would result in an additional 91,000 British jobs being created and £4.2 billion added to the economy in 12 months, it has been revealed.

The research, by World Travel&Tourism Council (WTTC), shows that comes as Britain is about to face yet another rise in Air Passenger Duty. Increases planned from April mean a family of four flying to Malaga will pay £52 extra on the price of their tickets. This rises to £260 for the same family to fly to Florida and £368 to fly to Australia.

David Scowsill, WTTC President&CEO, said: “Air Passenger Duty is a completely disproportionate tax on people’s holidays and is hitting business travel hard. When the economy needs help, it is economically illogical to continue with a tax that costs the country some 91,000 jobs and as much as £4.2 billion.”

In the next 12 months, the UK government will collect £2.8 billion in extra tax from air travelers, far more than any other country in the world.

David continued: “Travel and tourism grew by 4.1 percent in the UK last year, but is forecast to slow to 1.3 percent in 2012. This slowdown is partly due to the impact of Air Passenger Duty, which is dampening demand.

“This tax is damaging the economy at a crucial time and is having a negative effect on trade with countries in the Caribbean, Africa, and Asia. We urge the UK government to recognize the impact on the overall economy and reduce Air Passenger Duty.”

Martin Craigs, CEO of the Pacific Asia Travel Association (PATA), said: “The UK is an island trading nation; air services are the vital lifeblood of modern global commerce. The UK Air Passenger Duty is now the world’s highest by a wide margin. It is certainly turning away tourism and trade from the world’s fastest-growing economic region, Asia Pacific.

“Airport Passenger Duty started in1994 at £5 and some worthy intentions to offset aviations carbon footprint. Today at £85 to zone D (Asia/Pacific) it’s a ‘detention tax’ that’s restricting job growth, alienating important trade partners and not being transparently directed to green projects. Airport Passenger Duty maybe easy to collect but it’s also easy to see its macroeconomic damage.”