Holiday prices could jump by £70 per person

The cost of holidays for UK customers could ¬rise next year by up to £70 per person, as fuel costs and the weak pound continue to affect travel operators.

Roger Allard, chairman of the All Leisure Group, has predicted a 10-15% increase in package holiday costs in 2009, as major tour companies reduce capacity.

“If the big tour operators have hedged fuel and currency, and with the increases in hotel costs, they will need to increase prices by £70 on mainstream package holidays,” he said.

He noted that the average selling prices for holidays in late summer 2008 are £100 higher than last year. Thomas Cook reported ¬last week that average selling prices for 2008 will be up 5% on last year, combined with 19% fewer holidays on offer.

In 2009, consumers will likely feel even more pressure on disposable ¬income, meaning that fewer will travel abroad, Allard continued. “Some demand will fall off and mainstream operators will cut back,” he added.

Stuart Jackson, commercial and product director at Cosmos Tours said: “People who take two holidays a year or weekend breaks, which could be deemed a luxury, are most likely to come out of the market and that will probably affect low-cost carriers.”

The projected price hikes will most likely mean that the best prices will be offered to those who book early, and that fewer discounts will be available later in the year.

Agents have not seemed that overly concerned, with managing director of Hays Travel managing director, John Hays saying: “Next year is not going to be easy but I don’t think it will contract hugely. Our passenger numbers are not up but sales values are up substantially and overall commission earnings have increased. If we can replicate that next year it will be okay.”

Miles Morgan, owner of Miles Morgan Travel, agreed: “It’s not doom and gloom and hopefully it will educate people to book early.”

www.allleisuregroup.com