NEWS — HOT STORIES 2 3


GfK reveals little pickup in late summer bookings


Ian Taylor


Latest booking data suggests no more than a limited surge in late sales this summer. Analyst GfK reported July bookings much improved on June’s 7% fall but still 3% down on July 2013. Average prices in July, which


typically accounts for about 10% of summer bookings, were also 3% down on a year ago. Season- to-date sales and revenue both remain 2% down on last year. Sunvil chairman Noel Josephides, who chairs Abta, said: “We caught up a little in August – the last 10 days have been very strong, but not at decent prices.” He added: “Nobody has relished 2014. There is a lot of nervousness. Everybody has been hit.” Josephides blamed


overcapacity, saying: “Everything was held in check during the recession and last year was pretty good. Then everyone thinks of doubling [capacity].” A senior industry source told


Travel Weekly: “It’s very tough at the moment. There is a lot of capacity. It’s the most difficult market we’ve had and we’ve not


had anything bad happen – I don’t believe Gaza or an aircraft shot down over Ukraine has driven down the market. “Everyone was very optimistic,


believing the recession was over and people were going to spend. But we don’t see an upsurge in holidays. People are not getting great margins. The market has gone ex-growth [is not increasing].” GfK reported some highlights. Package bookings rose again in July, up 1% year on year for summer and winter, and family bookings were up 4% this summer. John Sullivan, head of commercial at Advantage Travel Partnership, said: “The mass market has had a few good weeks. “Our members’ average prices


were up year on year the week before last. It’s been a challenge but demand has been there from our point of view.” ❯ Comment: Josephides, page 26


Proposed Atol changes ‘over the top’, warns Abta Ian Taylor


Abta has warned of major changes to most Atol-holders’ businesses and said time is running out to respond. Anyone with Atol turnover below £5 million a year will be affected. John de Vial, the association’s head of financial protection, described the CAA’s proposals as “over the top” and said: “This will create a new regime for three-quarters of Atol-holders.” The CAA aims to abolish the Small Business Atol (SBA) – held


by 950 firms licensed for 500 or fewer bookings – and introduce new bonding and share-capital requirements, new “risk-based” financial criteria and revised Atol-reporting arrangements, including a licensed-practitioner scheme for accountants. Many small Atol-holders will be required to increase their share capital from £30,000 to £50,000 – “a significant change”, said de Vial. There will be a new licensable-turnover minimum of £500,000, with a minimum bond for new starters of £75,000, up from £40,000. De Vial warned this would “create an enormous barrier to entry”, saying: “82% of SBAs turn over less than £500,000 and 41% of all Abta-member


Atol-holders turn over less than £500,000. It looks like the CAA is turning its back on start-ups.” De Vial added: “The CAA proposes a level of monitoring that has not existed before. It’s talking about profitability ratios, liquidity ratios, financial stability ratios and net working-capital ratios. “But the consultation document does not include details. It’s


silent on what the tests are, when we’ll see them and whether we’ll get to consult. How do we respond? “The CAA also proposes that only licensed practitioners will be able to complete Atol returns. What are the costs involved?” Abta issued a questionnaire on the changes this week – for return by September 12 – ahead of the CAA deadline of October 6.


28 August 2014 — travelweekly.co.uk • 5


“Everyone


was optimistic, but we don’t see an upsurge in holidays”


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