CENTRAL EUROPEAN OFFICE
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1 CENTRAL EUROPEAN OFFICE O C T O B E R 2006 Prepared by: Barbara Schuch-Beckers Director Central Europe MARKET TREND/MARKET INFORMATION Thomas Cook plans to sell travel agency chain Thomas Cook is poised to sell off its loss-making German travel agency chain to medium-sized German bank, Raiffeisen-Volksbank, which owns one of the country s largest independent agency consortia. Germany s second-largest travel group, which aims to focus in future on its core tour operator business, confirmed that fundamental agreement had been reached between the two companies over a joint venture. The Thomas Cook travel agency chain, with 140 outlets and about 500 staff, generates turnover of some 240 million but makes a single-digit million euro loss. Several years of restructuring and cost cutting have failed to get the agencies out of the red. The Raiffeisen-Volksbank subsidiary RT-Reisen, in which TUI has a strategic 25.1% stake, is the driving force in the RTK agency consortium. Poor holiday sales in September for German travel agencies Travel agencies in Germany suffered an 8.3% drop in tourism sales last month, dealing a blow to hopes of good autumn sales, according to the latest monthly travel agency survey by the TATS organisation. This leaves leisure travel sales over the first nine months of the year down by 0.8%. Revenues from airline ticket sales were 1% down last month but revenues from service charges rose 11.5%. Overall, German travel agencies saw their revenues decline 4.5% in September, leaving them up by 2.4% over the first nine months. The monthly survey covers 2,750 German travel agencies, making it highly representative of overall market trends 1
2 TUI seeks new shareholders TUI remains on the lookout for strategic investors to strengthen its position against financial investors who are demanding that the group be split into separate tourism and shipping companies. Europe s largest tourism company has denied widespread German media reports that it had approached the federal states of Hamburg (home of shipping line Hapag-Lloyd) and Lower Saxony (whose capital Hanover is home to TUI AG). TUI issued a statement saying there were no negotiations with either state, nor were any intended, regarding a stake in TUI AG. But it confirmed that it had informed both states about the current situation at Hapag-Lloyd and the Group several weeks ago during the latest of regular meetings. According to FVW information, chairman Michael Frenzel has long been seeking investors from the tourism industry to buy minority stakes in the company similar to those held by the Riu family (5.1%) and the Spanish bank CAM (5%). Potential investors reportedly include Egyptian partner Hamed El Chiaty, Carnival chief Micky Arison and the Dubai investment company. Frenzel is due to present the TUI supervisory board in December with new proposals to get the group back on course. TUI Germany plans product expansion TUI Germany is planning to broaden its product portfolio once the ongoing integration of budget operator 1-2-Fly and premium brand Airtours into its organisation is complete, according to managing director Volker Böttcher. About 400 jobs will go by next March through the integration, although it is still unclear whether Airtours Frankfurt head office will be closed completely. Meanwhile, the major product initiatives for TUI in summer 2007 have emerged. There will be more 19 city destinations, about 1,500 additional long-haul hotels and the launch of a family clubs brochure containing 20 properties. TUI has started the 2006/07 winter season well, with good demand for the Canary Islands, long-haul holidays and city trips, according to Böttcher. SALES ACTIVITIES The American Consulate in Leipzig is organizing a North America event with Karstadt in Leipzig on November 16, which will be attended by Consul General Mark Scheland. The Commercial section of the Consulate in Frankfurt will also have a colleagues from their Public Affairs section to hand out the "About the USA" CD-Rom, bookmarks and U.S. maps and flags, answer questions regarding visa etc...". St.Petersburg/Clearwater has been asked to supply our brochures and information material to be distributed at this event. 2
3 We attended a Visit USA Committee Meeting at the airport in Frankfurt. On the agenda were the election of the new board from January 1, 2007 to December 31, Old and new President is Rita Hille of Wiechmann Tourism, who has held this position for several years. The list of board members has only slightly changed which will guarantee a continuation of the successful work of the committee in the future. Another topic has been the cooperation with the Willy Scharnow Foundation. It was confirmed that the USA has been chosen as partner country for the coming year. This will be announced on a press conference shortly. Scharnow will conduct 5 to 6 training trips for travel agents to the United States in St.Petersburg/Clearwater together with Orlando will again be one of the destinations visited. The VUSA Breakfast Seminars for 2007 have been introduced. A total of 24 travel agent seminars will be conducted throughout Germany as well as in Switzerland and Austria. St.Petersburg/Clearwater has registered for six of them. Our combined online training which was very successful will be continued. An advanced level will be offered to those 885 travel agents who have graduated from the last training. In addition the basic level will still be available for new beginners. We have expressed our interest in again participating. The online graduates will also be addressed through a joint newsletter which gives every member the opportunity to relay their information to the agents. From 2007 on the three VUSA Committees in Germany, Switzerland and Austria have decided to work more closely together. Part of the new cooperation will be the establishment of a legal basis for a combined annual fee. This will reduce our membership fee considerably. We do participate in a mailing initiated by tour operator Meier s Weltreisen to end-consumers in Germany in November For this mailing a special flyer has been created, titled North America Variety Pure. Only 10 partners could participate, namely: Georgia, Lee County, The Great Lakes, St.Petersburg/Clearwater, Chicago, Starwood Hotels & Resorts in Hawaii, New Brunswick, Palm Springs, Orlando and British Columbia, Canada. The mailing piece turned out very nice. It includes our Caladesi Island and a Dali photo, our editorial about the area, a special offer in our region from the Meier s catalogue and a contest where we ask the reader to name the slogan of the St.Petersburg/Clearwater area. Meier s expects a large response and we shall receive a list of all those persons who have shown interest. On behalf of St.Petersburg/Clearwater we attended a very special dinner organized by the American/German Business Club in Frankfurt. Top speaker of the evening was the 3
4 Minister President of the State of Hesse, Mr. Roland Koch on the subject Investment Site Hessen Fit for International Competition as well as his insights on the American vs. German way of doing business. Also in attendance were the former Defense Minister and Chancellor Canditate Rudolf Scharping and former US Ambassador Dan Coats. A total of 160 high ranking guests were present and we had the opportunity to talk to a number of them about St.Petersburg/Clearwater. St.Petersnburg/Clearwater partnered with the U.S. Embassy, Commercial Service in Switzerland by having our brochures distributed at the Travel Trade Workshop 2006 (TTW) which took place in Montreux, Switzerland on October 26 and 27. The show attracted over visitors (6.6% more than 2005). There were 533 Swiss and international exhibitors. The industry press and exhibitors alike praised TTW as one of Europe s leading industry fairs. The USA Pavilion was always crowded and very well visited by interested people. The preparations for the upcoming Thomas Cook/Neckerman Travel Summer show were quite comprehensive. St.Petersburg/Clearwater will participate in this program on November 4 & 5 at the Frankfurt fairground, where the operator will introduce their summer catalogues 2007 to approximately travel agents from all over Germany as well as to the interested public. We will partner with the Visit USA Committee Germany by maintaining our own booth there. In addition, we shall be included in a lecture to approximately 100 listeners. A power point presentation has been prepared for this event. In addition we shall participate in a raffle for which we received the generous donation of 7 nights each at the Barefoot Beach Resort and the Safety Harbor Resort & Spa. During the month of October we have received the following number of requests: Trade 4 Consumer 11 TRAINING TRIPS The final arrangements for the Delta Air Lines Super Fam which will take place from November 7 to 13 has taken much of our time. Our office was in charge of the project since the original idea came from the St.Petersburg/Clearwater CVB. The invitations, the RSVP s, the flight arrangements with Delta Air Lines as well as the mail out of the combined Orlando, St.Petersburg/Clearwater program was handled by our office. We 4
5 were also in charge of answering all further questions in regards to the entry regulations, credit card payments etc. A total of 14 well selected tour operator agents with at least five years working background will travel to Orlando, visit Busch Gardens and be in our area November 10 to 13. Meier s Weltreisen has reconfirmed their training trip for 12 travel agents plus tour guides for the period January 13 to 18, The group will first visit Orlando and then transfer to St.Petersburg/Clearwater on January 16. LTU flights to and from Ft. Myers are confirmed. The Willy Scharnow Donation training trip has been finalized. A group of 18 German travel agents plus 1 tour guide are on their way to St.Petersburg/Clearwater. They will stay in our area November 1 to 7. The Leisure Travel Department has established an excellent educational and exciting program for the agents. We can be certain that our 15 th movement for this organization will again be a great success. PUBLIC RELATIONS As part of advertisements to be placed in the German trade and consumer papers Fremdenverkehrswirtschaft and Urlaub Perfekt we have been offered another winning game in the Urlaub Perfekt magazine free of charge, which will appear in December Urlaub Perfekt has an edition of per copy of which are sold at the news stand. We have been able to find the following partners for this game: The Sheraton Sand Key Resort sponsors 7 nights accommodation, Martinair grants two tickets from Amsterdam to Orlando and return and finally Holiday Autos will complete the package with a rental car for one week. We expect several hundred consumers and travel agents to again participate in this raffle. Travel Talk, the German trade paper addressing the counter agent will publish a report on Florida in November. Approximately 60% of all German travel agents subscribe to Travel Talk. We have been asked to supply several photo images of St.Petersburg/Clearwater. Pictures of the Pier, The Don Cesar, Shell Key and Caladesi Island were sent to the publisher. As a result of Gerald Huft s (publisher of the ICJ mice magazine for meetings, incentives, congress and events) visit to our area in spring of this year a comprehensive 5
6 report on St.Petersburg/Clearwater appeared in the September/October issue of the magazine. A full page including two beach photos, an Innisbrook as well as our rosearte spoonbill bird picture. In addition the Sheraton Sand Key is featured in a very positive and lengthy report. The circulation number of the Mice Magazine is: decision makers, agencies and handouts during international trade fairs. We have been approached by Elke Quipor of Nimbus Productions in Frankfurt whom we had met during our sales mission in September. The company offered to produce a show titled Rave around the World to be broadcasted on private TV channel VOX. The lead has been forwarded to our PR agency News Plus. Monthly Sales Activity Report Attach lists of calls, leads # Sales Calls # Sales Leads # TA Educ Workshop # Press Contacts # Trade Mailed # Vis Inq Mailed # Trade Shows October November December January February March April May June July August September 6
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