ded Barclays’ 13th annual Forum in London. Lee Hayhurst reports


Deloitte upbeat despite drop in spend sentiment


Deloitte has seen a first significant fall in consumer spending sentiment on holidays in the five years it has been tracking the market, the forum was told.


Senior partner Graham Pickett said despite the “surprising” downturn he remained optimistic about prospects for the sector although he added there was “a degree of caution around”. He told delegates that a change in the type of holidays people are seeking looks set to impact spending on travel. Turning to this summer’s lates


market, he predicted it would be “quite challenging”. “There will be a bit of extra capacity around and there will be deals,” he added. “That could be good, it could be bad. “This industry is good at


“Looking at travel and the economy, a number of factors are beginning to cause consumers concern”


responding [to challenges] in fairly quick time. It’s not an industry that struggles with change.” Addressing the UK economy,


Pickett said: “The UK is seeing an issue with a widening trade gap. “We have a very nervous consumer now. “When you start looking at the


travel trade and the economy, there are a number of factors that are beginning to cause some concern for the consumer. “Personal debt is definitely up. On house prices, the feelgood


PICKETT: ‘There will be a bit of extra capacity around in lates’


factor at home has been around for some time but is now easing, and we have considerably higher costs from inflation in terms of utilities. “We are seeing a lot of challenges in retail, in licensed premises and restaurants. There is pressure because the consumer is not spending as they did.” Political uncertainty in Germany


and Italy was also causing uncertainty, added Pickett, who said Italians were now worse off than Spaniards, raising the prospect of a backlash against the euro.


‘Brexit skills shortage is biggest challenge’


The travel industry’s biggest challenge related to Brexit will be access to skills, according to Deloitte’s Graham Pickett. He told the Barclays forum that nearly half of highly


skilled EU nationals living in the UK said they intended to leave the UK within five years, when surveyed. “Look at the number of people our industry


employs,” said Pickett. “There is significant risk for us here. When labour is short, costs go up.” Gavin Isle, head of UK coverage at Barclays


Corporate Banking, said Brexit was causing uncertainty, particularly in sectors heavily reliant on skilled labour from overseas. He said: “In a world of uncertainty around Brexit,


what’s important is [being] prepared for whatever form Brexit takes.”


Pickett also warned about the prospect of increased


interest rates on consumer spending, although he said he expected no further rises until after the summer. “There is a generation of consumers who have never


experienced [interest rate rises],” he said. “What does it mean for them?” A resurgent US dollar is causing concern among the


world’s fast-growing emerging economies about their ability to pay their dollar debts, added Pickett. And although the European economy had been


having a “pretty good time”, Pickett said political uncertainty in Germany and Italy following elections saw a “blip” in early 2018. Pickett also warned oil prices will rise due to


the Iran crisis as the US reimposes sanctions after oil-producing countries in Opec had cut production.


ISLE: ‘Important to be prepared for whatever form Brexit takes’


17 May 2018 travelweekly.co.uk 71


Young says trade ‘catching up’ with adventure demand


The travel trade has lagged behind emerging customer demand for more experiential holidays but is catching up, according to the UK boss of G Adventures. Brian Young, the operator’s managing director for the EMEA region, said the creation of the Association of Touring & Adventure Suppliers (Atas), the


trade body established by Travel Weekly, showed how agents were grasping the opportunity. “The consumer is driving this and the trade has lagged behind a bit, but it’s really starting to catch up now,” he said. “I liken it to the cruise sector. When capacity was coming in to the industry, the agency community was playing catch-up, so [trade body] Clia was born.” Lucia Rowe, A-Rosa River Cruises’ head of sales for the UK and Ireland, said the river sector’s staid image had been transformed as a new generation of customers discovered its attractions. But she warned agents against


treating it like ocean cruising. “Those agents and operators


trying to sell it to the same database as ocean cruise have not been successful,” she said.


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