The falling Pound and its effects on the Travel Industry

mystic_trev

I'm interested to know what effect this is going to have on the Consumer and the Travel Industry. Will you be cutting back on overseas holidays?

It looks like the Airlines will suffer a large downturn in demand, will the likes of Ryanair still be offering cheap flights, and how many of the Budget Airlines will survive?

As an anectote, I have friends in the Algarve who I visited ealier in the year. Then you could still get around 1.3 Euro's to the pound. They told me that they expected things to be OK for this year, but pretty dire for the 2009 season if there was no recovery. Now the pound stands at 1.17 and looks like going down further.:eek:

stephb34

Hi a lot of people are booking for egypt and turkey at the moment countries that arent in the euro, or if they do book for euro countries they are going for the all inclusive option as then they've budgeted in advance.
A bit hard to tell at the moment if the credit crunch is crunching cause it tends to slow down this time of year anyway, will be able to tell better in january.
The euro was 1.12 saturday oh dear!!!

Tojo_Ralph

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A combination of the falling pound, general price increases, failing airlines, the credit crunch perceived or otherwise and the fear of what is to come is going to have a huge impact on the travel industry IMHO and that will inevitably have an impact on the destination itself.

The UAE and in particular Dubai is an excellent example of a destination that just has to be impacted by the current exchange rates. Both the Euro and the GBP hve fallen by approx 25% against the Dirham in recent months and that coupled with price increases in general have made the cost of the holiday basics of hotels, eating out and booze somewhere in the region of 30% to 40% more expensive than last year.
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Tojo_Ralph

stephb34 wrote: »

Hi a lot of people are booking for egypt and turkey at the moment countries that arent in the euro.

Not being in the Euro does not mean that one necessarily escapes declining exchange rates and with regard to the Egypt, the cost of living aside, you are now getting 30% less Egyptian Pounds to the GBP than you were this time last year!!

mystic_trev

Tojo_Ralph wrote: »

...
The UAE and in particular Dubai is an excellent example of a destination that just has to be impacted by the current exchange rates. Both the Euro and the GBP hve fallen by approx 25% against the Dirham in recent months and that coupled with price increases in general have made the cost of the holiday basics of hotels, eating out and booze somewhere in the region of 30% to 40% more expensive than last year.
....

Cheers Tojo I'm off there next week for the Dubai Sevens.

swiss69

The only country to benefit from this is the UK! Holidaying in this country will become the norm again for many people if this continues.

Last year I was paying 5 euro for a beer in some places on the costa del sol - Thats over £4 at current rates. In the canaries A Gin and Tonic was 6 euro.

I think a family of four on self catering eating out twice a day would need a minimum of £125 a day now just for a basic holiday.

All inclusive is so much more attractive nowdays if you can find a good one!

rbulph

mystic_trev wrote: »

Cheers Tojo I'm off there next week for the Dubai Sevens.

You may only be able to afford Fives.

moonrakerz

Tojo_Ralph wrote: »

you are now getting 30% less Egyptian Pounds to the GBP than you were this time last year!!

.............and Gordon Brown says we "are well placed" to ride out the recession !

What a ******er !

Backbiter

moonrakerz wrote: »

.............and Gordon Brown says we "are well placed" to ride out the recession !

What a ******er !

The falling pound could help the UK economy as it should boost exports, which will become cheaper. Unfortunately, though, we have seen such a contraction of our manufacturing base over the past 30 years we don't actually produce much that we can sell overseas. At the same time, imports will cost more, and the fall in the pound against the dollar will reduce the benefits to be had from the fall in oil prices.

What might happen is that tourist destination will have to lower prices to attract British visitors. If we stay at home, their business will be seriously hit as we are major players in the tourism business.

Tojo_Ralph

mystic_trev wrote: »

Cheers Tojo I'm off there next week for the Dubai Sevens.

I hope you aren't planning on drinking much ..... With the Dirham now sub 5.40 to the £GBP, that makes your 30 to 35 AED bottle of beer a healthy £5.56 to £6.48 a pop. _pale_
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mystic_trev

Thanks Tojo - that's what we're intending to do. I think four bottles of Scotch each might be a bit much for four days!