market outlook Strong demand amid slow economic growth forecast


prices have offset the lower volumes to an extent, and Pritchard said: “I’m not sure I see business travel coming back to the levels we saw pre-pandemic.” He explained: “Immediately post-


pandemic, small and medium size enterprises (SME) saw quite a corporate travel boost, whereas we saw a more subdued return on the large corporate side, in part because of company policies to control costs and meet sustainability targets. Those policies still exist for large corporates and, if anything, are probably starting to tighten both around cost and sustainability. We’ve also seen a softening on the SME side. People will continue to travel for business, but we’ve previously flagged concern that corporate travel might not recover to historic levels and that is what we’ve seen.” Pritchard “broadly expects a ‘normal’


year” in 2025, “in that there will be high demand for leisure travel”. He suggested: “What happens in the Middle East could have a bearing on where people choose to go, but people still want to go on holiday.” Whether it will be another record year


“is harder to predict”, he said, noting: “There is a level of consumer confidence at present that should be good for the sector. But that confidence may reduce over the course of the year. I’m not saying it will


FIGURE 19: TRUST IN AIRLINES


TO REDUCE IMPACTS OF FLYING


% of UK adults No trust


Don’t know


10% 7% 14% net %pt +2 trust airlines 30% Not much trust Some trust


Source: CAA Consumer Survey, October 2023 Base: 3,510 UK adults


39%


Complete trust


disappear, but it may not be as strong – driven by impacts of the Budget feeding through and by impacts of decisions elsewhere in the world that could impact on businesses in the UK or in Europe. “There could be some challenges as


we go through the year. So, it’s difficult to predict whether bookings will be as strong in the lates market this year as last and whether prices will hold up. There is quite a lot of uncertainty. How long might it take for lower business confidence to feed through to consumers? How long might it take for a US focus on its domestic market to feed through to businesses elsewhere? “So many uncertainties feed into the


sector – whether economic or geopolitical risks, or the impacts of weather and the climate. We’re seeing more extremes – hot temperatures, floods, storms and hurricanes – and that increases the level of uncertainty. “It doesn’t mean people won’t want


AIRLINES don’t appear


wholly trusted to reduce the environmental impacts of flying (Figure 19). All-inclusive demand


has hit an all-time high according to research for this report (Figure 20). Summer heat in destinations appears a concern


(Figure 21), climate concerns could influence behaviour (Figure 22)


and there is a growing awareness of overtourism (Figures 23 & 24)


to travel. It might mean they think more about where they want to go, or more about insurance. It means businesses across the sector need to be even better at dealing with increasing operational challenges.” Those uncertainties, along with a


strong level of intention to travel, are reflected in the results of the consumer research throughout this report.


10 20 30 40 50 60


%


% of holidaymakers likely to book all-inclusive in 2025


50% 52% 44% 43% 40% 46% 47% 52%


FIGURE 20: ALL-INCLUSIVE DEMAND, 2015-25 By age, children


57% 59% %


10 20 30 40 50 60 70 80


0 0 77%76% 62% 58% 51%52% 48% 41% 37% 42% 38% 31% 34% 35% 28% 41% 37% 60% 63% 53%54% 54%41% 45% 76% 70% 61% 77%77% 69%


16-24 2015 2017 2019


25-34 2024


35-44 2025


45-54


55+


Child


Source: Service Science/Kantar, January 2025 Base: 925 UK adults planning an overseas holiday


14 Travel Weekly Insight Report 2025


2015 2016 2017 2018 2019 2020 2021 2022 2023-24 2025


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