CENTRAL EUROPEAN OFFICE

Transcription

1 CENTRAL EUROPEAN OFFICE A P R I L 2007 Prepared by: Barbara Schuch-Beckers Director Central Europe MARKET TREND/MARKET INFORMATION Expansion in Europe FCM DER Travel Solutions, the German business travel unit of Rewe Touristik, plans to expand into neighboring European markets after winning Siemens as a global travel account. Austria and Switzerland are top of the list. FCM DER Travel Solutions is already profiting from membership of the international network of Australia-based FCM which it joined last autumn, according to DER managing director Ralph Osken and business travel chief Christian Spangenberg. It has just been named a global business travel partner for Siemens, a long-standing client for domestic business, and is in talks with listed German companies that could generate a further million of turnover in FCM DER Travel Solutions had revenues of 701 million in 2006 (excluding the 450 million generated by franchise organisation Derpart), with about two-thirds coming from SMEs, which are its main customer base. Under the FCM partnership agreement, FCM DER is not only responsible for Germany but also Switzerland, Austria and Eastern Europe. The company now plans to expand into these countries through a minority holding in Austria, an exclusive cooperation in Switzerland and a bookings call center in Eastern Europe. Speculation over sale, Teckentrup future Thomas Cook and KarstadtQuelle have denied reports that Condor might be sold to Air Berlin, and that Condor chief and Cook board member Ralf Teckentrup might move to Air Berlin. 1

2 Mayrhuber eyes Iberia, Alitalia Lufthansa could be interested in buying into Iberia or Alitalia but the current prices for a holding are too expensive, according to CEO Wolfgang Mayrhuber. Speculation over the two airlines future has grown following the recent EU-US Open Skies deal. The decision of the Spanish government to seek an investor for Iberia has attracted interest from around the world, with US equity group TPG and European airlines such as British Airways (which already holds 10% in Iberia) and Lufthansa named as potential buyers. TPG has offered 3.60 a share for Iberia, valuing its offer at 3.4 billion, and the Iberia board is due to meet this week to consider the offer. Separately, the Italian government is ready to sell 40% in Alitalia, and has already drawn a bid from a consortium including Aeroflot. Mayrhuber said in a German newspaper interview that both Iberia and Alitalia would be ideal partners. Iberia was attractive for its position in the Latin American market, for example. But Lufthansa was not interested in hanging millstones around its neck, he stressed. Alitalia, for example, needed to be radically restructured to gain a more entrepreneurial culture. In a separate interview, he said that Iberia, with a stock exchange valuation of 4 billion, was clearly too expensive. A Spanish news agency report that Lufthansa was planning an offer of 4 per Iberia share was described as market speculation by a Lufthansa spokeswoman. In recent weeks, the Lufthansa CEO has stressed that the German carrier wants to play an active role in consolidation of the European aviation industry. Under the recent EU-US Open Skies agreement, which will come into force in spring 2008, EU airlines will be able to fly from any EU airport to any US destination, and also continue on to other destinations. The nationality of an EU carrier will become largely irrelevant in terms of traffic rights. This means, for example, that Lufthansa or a subsidiary airline could fly from Britain, France, Spain or Italy to the USA. The European Commission expects the Open Skies liberalization to generate a boom in transatlantic passenger volumes from the present 50 million to some 75 million within five years. The two companies played down a newspaper report that they are in talks with Lufthansa to buy out its 24.9% holding in Condor earlier than the agreed date of 2009, and that Condor might then be sold on to Air Berlin. KarstadtQuelle said that it is keeping to the terms of the contract with Lufthansa regarding the acquisition of Thomas Cook and majority holding in Condor. The report followed the announcement of the code-share between Air Berlin and Condor, which quickly generated speculation that Air Berlin could follow the acquisition of LTU with that of Condor. Meanwhile, Cook has denied a separate report that Teckentrup had held talks with Air Berlin chief Joachim Hunold over a possible move to the airline. The Boersen-Zeitung said that the code-share between the two airlines was largely thanks to Teckentrup, a former Lufthansa 2

3 passenger airline board member. But a Cook spokesman said that the manager had an exciting responsibility with the company that he would fulfill Meanwhile, former Thomas Cook CEO Wolfgang Beeser has left the company s supervisory board and will join that of Kuoni. Fontenla-Novoa promises growth ideas The forthcoming Thomas Cook IPO prospectus will contain growth ideas, CEO Manny Fontenla-Novoa told FVW in an interview. He did not rule out acquisitions of niche players following the MyTravel merger, and revealed plans for a second-tier management board for source market chiefs. Fontenla-Novoa said he did not expect any regulatory problems for the Thomas Cook / MyTravel agreement in view of the TUI/First Choice merger and competition from internet portals and low-cost carriers. According to our definition, Thomas Cook and MyTravel have only 14% of the British travel market. Our merger will strengthen competition since we will reduce the gap to the new market leader TUI Travel, he stated. He was hopeful that most staff in the two companies whose jobs would be affected by the merger could still be employed due to the high fluctuation in the combined figure of 1,000 travel agencies. Asked about the comments of TUI chairman Michael Frenzel that the Cook / MyTravel merger was only a British consolidation, Fontenla-Novoa said that the forthcoming IPO prospectus would also contain growth ideas. One example that we are not standing still is the Condor codesharing with Air Berlin/LTU, he pointed out. The IPO prospectus is due to be published very shortly. On possible future acquisitions, Fontenla-Novoa said that although he did not see any further movement among the leading tourism groups, without a doubt there are more opportunities for acquisitions in the area of smaller niche players. On the future structure of the Thomas Cook Group following the MyTravel merger, Fontenla- Novoa said that there were plans to set up a management board below the PLC board incorporating all the heads of the source markets, including Continental Europe, Britain, Scandinavia, Canada, as well as Condor. There was no decision yet whether the KarstadtQuelle travel agencies would be transferred to Thomas Cook, he added. Meanwhile, Thomas Cook could gain a minority holding in Air Berlin under any agreement to sell Condor to the fast-growing carrier, FVW reported. A financial stake would enable Cook to secure access to seat capacity for its tour operators and also to earn from Air Berlin s profitability. Condor would gain real growth prospects compared to the present situation with an ageing fleet and shareholders who are not interested in investing in the carrier, while Air Berlin would gain the size to compete with Ryanair and Easyjet. 3

4 Medium-sized operators win market share German travel agents are selling more holidays from medium-sized tour operators this year, an FVW survey of leading agency groupings showed. The sales picture for market leaders is more mixed, with TUI doing well, Rewe stagnating and Thomas Cook showing a downward trend. Overall, the leading agency groupings are doing well this year with good single-digit or even double-digit growth rates. Good growth for the German economy has improved the consumer spending climate, and there are no major negative influences impacting on the travel sector at present. The five major travel agency groupings all reported rising sales of holidays from medium-sized tour operators. The two larger independents, Alltours and FTI, also have higher sales this year, according to QTA, RSG, LCC, TSS and Derpart. In contrast, among the three market leaders, TUI, Thomas Cook and Rewe, only TUI is generally showing a positive trend with sales growth at four out of the five agency organizations. Sales of Cook products are lower at all five groupings. Rewe s package holiday operators are stagnating but there is strong growth for its individual holiday operators (Dertour, Meier s). The trend towards medium-sized tour operators was confirmed by several travel agency chiefs with romantic metaphors. Agencies are in love with them, commented Thomas Boesl, head of QTA, the leading travel agency consortium. In contrast, the traditional loyalty to a single lead tour operator is crumbling, he pointed out. Klaus Henschel, managing director of the LCC cooperation group, added: The big operators haven t always been friendly, so you look around for other brides. The big groups need to watch what is happening around them. It s no longer a question of big or small, but of fast and slow. The trend away from the market leaders is due to a combination of factors, and particularly due to better commission payments from smaller operators than from the market leaders, according to agency chiefs. The big players are too occupied with themselves but medium-sized operators are focused on travel agencies, explained Carsten Burgmann, head of tourism sales at LCC, which has been actively steering sales towards smaller operators. We are no longer so dependent on the Red side (TUI) and the Yellow side (Cook), agreed Andreas Heimann, Derpart franchise chief. Derpart has also been actively selling products of smaller operators, who were generally more flexible and service-oriented than the market leaders. Nevertheless, the bulk of travel agency sales remain products from TUI, Cook and Rewe. TUI is benefiting from better sales conditions and more agency support this year, the FVW survey showed. Of the Big Three, TUI is the clear winner, QTA chief Boesl said. Thomas Cook, in 4

5 contrast, has suffered from a much-criticized new commission payment system, although its lower sales this year admittedly follow strong growth in The commission system is unacceptable, declared TSS chief Manuel Molina. But Cook s sales chief Günter Geske claimed that the new 6% starting level was a low barrier, and that three-quarters of agencies still earned 10% or more. Rewe has traditionally been popular among travel agents due to its attractive commission structure, but is suffering from weak package holiday brands. Rewe has a problem with the positioning of its brands, LCC chief Henschel said. They are lacking group and family holidays, TSS boss Manuel Molina added. In contrast, Rewe s main individual holiday operator Dertour is growing strongly. Dertour is profiting from its ability to respond fast, pointed out LCC tourism chief Burgmann. FTI is profiting from good products and attractive commissions, while Alltours generally benefits from being the main beach holiday alternative to TUI and Neckermann. Stagnating leisure travel sales in March After two months of good growth, German travel agents suffered stagnating sales of leisure travel products last month, according to the latest monthly travel agency survey by the TATS organization. Sales of holidays and other leisure travel products declined by 0.7% in March after a 2.9% rise in January and a 6.3% improvement in February, the survey found. Over the first three months of 2007, German travel agents have thus generated a 2.9% increase in holiday sales. Airline ticket sales slowed to growth of 2.6% last month after rises of 8.4% in February and 14.5% in January, and are thus up by 7.4% in the first quarter. Total revenues grew 0.7% last month and by 4.7% over the first three months. The monthly TATS survey covers 2,550 German travel agencies. Top operators cut prices in latest brochures Lower prices to boost bookings that is the tactic of several leading German tour operators in their newly-released second edition brochures. TUIfly is even offering virtually free flights for children. Traditionally tour operators put up prices in their second edition brochures after offering attractive initial prices to generate early bookings up to the standard March 31 deadline. But this year several operators have broken with tradition due to poor sales and competitive pressures. 5

6 Neckermann, which is below last year s sales levels, set the pace with a 4% price cut compared to last year for major destinations including Spain, Greece and North Africa, along with a range of extended discounts. Alltours, with higher sales this year, has countered by reducing secondedition holidays by 5% compared to last year, extending early booking discounts in 70% of its hotels into May, and offering 50,000 additional special offers such as cheaper flights in May and June. The latest major operator to cut prices is ITS, the Rewe mass market operator. It has reduced prices for North Africa by 7%, for Turkey by 5% and for the Canary Islands by 1% compared to last year. Most other destinations have unchanged prices. At the same time, it is extending early booking discounts for the Balearic Islands until the end of April and for Turkey, Crete and Morocco until the end of May in some cases. Attention is now focused on how market leader TUI will respond to the price trend in its secondedition brochures. TUI s budget operator 1-2-Fly has already cut prices by 6% on average, and extended the range of discounts. Meanwhile, TUIfly has unveiled a special offer designed to encourage more families to fly with the carrier. Children will pay only taxes and charges for all bookings made between April 24 and 29. SALES ACTIVITIES Our Valentine s winning game conducted with British Airways and Orlando was most successful. The information on both destinations as well as the raffle published on the socalled Speedbird Club website of British Airways for the trade attracted a total of 850 participating travel agents from all over Germany. The winner of the raffle is: Mr. Rolf Seidel of Meier s Weltreisen, Study Tours Department. He wins British Airways tickets, hotel accommodation in Orlando a rental car and 7 nights accommodation in a condo at the Madeira Bay Resort of TRS, Inc. We thanked British Airways for having selected St.Petersburg/Clearwater the second time for this promotion. German Tour operator DERTOUR has requested 600 of our maps Passengers who have booked a vacation in St.Petersburg/Clearwater through DERTOUR will receive a copy of our map together with the official travel documents. 6

7 We assisted Ms Lingenhoehle of Reisebuero Maichle with her hotel reservation at Barefoot Beach Resort. She won a certificate at the Thomas Cook Reisesommer and is now planning her trip to our area. In order to arrange for additional appointments at Pow Wow, we sent s to approximately 50 tour operators especially in Eastern Europe, France and Italy. A total of three firm appointments could be arranged and another 10 companies answered and promised to stop by our booth whenever there is a spare moment. Final arrangements were made for our joint Sales Mission together with Visit Florida and other Florida partners. A special power point presentation as well as question and answer forms were prepared and sent to Visit Florida. The mission will take us to the cities of Hamburg, Berlin and Frankfurt from May 22 to 25. We expect to train up to 300 travel agents and in addition hold staff trainings at tour operator companies Dertour and Meier s Weltreisen. Even though CMT Stuttgart, the largest consumer fair in Germany is months away- it takes place in January 2008 we have again been invited to participate in the official winning game organized by the Stuttgart Airport colour visitor brochures will be printed in which the game is published. The raffle is also advertised in the official fair catalogue and in the press. A 7 nights stay in our area together with tickets from Delta Air Lines as well as a rental car will make the first prize. Other sponsors are for instance Mercedes and various renowned companies in Germany. We provided head office with a comprehensive list of suggestions for the advertisement campaign 2007/2008 on the Central European market. The cooperation between our PR department, the ad agency and us in the field has developed very well during the past years and we feel, that our combined efforts have shown very good results. We attended Pow Wow 2007 in Anaheim, Ca. from April 20 to 26. Following is a rundown of our meetings and subjects discussed: 1. Joelle Dessard + Danny Dumon Visit USA Committee Belgium and Commercial Service American Embassy Brussels discussed various promotion opportunities like brochure distribution to 150 Belgian journalists as well as at major travel fairs in the country. 2. Hans Tattersall, Managing Director of Eaglerider, Holland wishes to send 3 to 4 journalists to St.P./C. in order to experience motorcycling in our area. He will contact us for further details. 7

8 3. Eric Engelhardt, Sales Manager, Aeroplan Reise GmbH. Germany Together with Delta Air Lines, we have recently produced a very attractive flyer which went out 3 times to travel agents in Germany in addition to an newsletter to agents. We have suggested a similar promotion for the business year 2007/ Heike Pleuter, Product Manager North America, Meier s Weltreisen, Germany we plan a joint promotion together with Orlando and possibly Disney and Anheuser Busch in January or February of 2008 for a group of consumers to be invited by their travel agents. This is a new concept introduced to us by Meier s which we find very interesting. In addition, other opportunities like a VIP customer mailing including a winning game are available. 5. Jakub Pawlusinski, Sales & Marketing Manager, Holiday Tours, Poland wishes to found a Visit USA Committee in his country. We assisted him with the respective contact addresses. He also is interested in putting together a Florida program which would include our area. A list of receptive operators was given to Mr. Pawlusinski and he will keep us advised on his progress. 6. Patricia Schaumans, Product Manager North America, Jetair, Belgium offers advertisement in an information booklet to appear in autumn copies will be printed. The operator sends between 5000 to 6000 clients to Florida annually. In addition a training trip for 16 to 20 travel agents and journalists is planned in December The itinerary will include Miami and our area. We have offered our assistance. 7. Claudia Henze-Dynio, Product Manager USA & Canada, Neckermann Reisen, Germany With Neckermann we plan a joint training trip for travel agents in 2008, our participation in their road show and a possible expansion of the operators St.Petersburg/Clearwater program. Further discussions to follow. 8. Kenny Prevost, Product Director USA, Knecht Reisen, Switzerland newly established Swiss tour operator who already sends approx passengers to the USA p/y of which 25% come to Florida. They feature 8 properties in our area in their catalogue and book through New World Travel. Mr. Prevost presented us with a catalogue of marketing opportunities and we shall let him know what is of interest and doable for us. 9. Katja Wagner and Beate Helmes Product Managers North America, Dertour, Germany - reconfirmed, that St.Petersburg/Clearwater together with Orlando will be the selected destination for their Megafam a movement of 100 travel agents. We have tentatively set the dates for May 4 to 11, 2008, i.e. the group goes to Orlando May 4 8 and then to our area for the rest of the stay. Dates and program will be coordinated with head office. 10. Tilo Krause-Duenow, Owner, Canusa Touristik, Germany Canusa reports strong increases for Florida and our area. They are the only tour operator featuring SSL in their catalogue and have now confirmed that this program is going to be enlarged. Together 8

9 with Orlando and pending head office approval, we plan a joint consumer mailing to approx clients. 11. Thomas Jenzer, Director and Beat Diggelmann, Senior Product Manager USA, Skytours, Switzerland Skytours now part of Hotelplan Switzerland also reports a 20-30% plus in booking numbers to the USA. Florida has a major part in this. We have successfully launched a combined consumer/agents promotion campaign this year and plan a repetition in 2007/2008. A proposal will be worked out by Skytours. 12. Andreas Goedel, Product Manager, Hermes Touristik, Germany This operator is linked to one of Germany s largest mail-order houses, Otto-Versand, as well as to TravelChannel.de and travel agency chain Reiseland. Receptive operator is New World Travel. The operator contracts with 1200 German agencies. We plan to work together on joint programs and will work out a proposal. 13. Miranda van Dam, Product Manager, Kuoni Travel, Holland one of the country s largest operators to the USA. We have suggested to include Kuoni in our advertisement plan and would like to be part of the operator s monthly newsletter to their agents possibly including a winning game. We shall work on this program. Kuoni will send a group of 14 agents on a Florida trip also to our area on May Merike Hallik, Managing Director, Kaleva Travel AS, Estonia the three Baltic States are in the process of founding their own Visit USA Committee. The three States have 8.1 million inhabitants. We have been offered to do a workshop where travel agents from Estonia, Lithuania and Latvia would participate. This might be a project for the future. 15. Lenka Fisková, Product Manager, Firo-tour, Czech Republic Firo Tour is a well established Czech tour operator with 22 branches across Eastern Europe. They are in the process of developing a Florida program. We shall keep in touch to see that St.P./C. will get it s share in the catalogue. 16. Stefan Spiess, Managing Director, Cosulich Ltd., Switzerland the operator specializes in cruises all over the world. There might be possibilities to arrange add-on vacations in our area for cruises which depart from and end in Tampa. 17. Rainer Hillers, Sales & Office Manager, America Unlimited, Germany fairly new tour operator with a turnover of passengers to the USA already. The receptive operator is Travalco. We have been offered to co-sponsor a 4 page flyer to go out to clients. Further negotiations will be made. 18. Andreas Neumann, Vice Manager Long Haul and Juergen Heiss Director Product Management North America, TUI/Airtours, Germany the company has just moved all their offices to their head office in Hanover. TUI will especially focus on the USA in summer 2008 and offer various marketing opportunities for the next business year. We shall definitely plan some cooperation with the world s largest tour operator. 9

10 19. Michaela Baier, Supply Manager, Booking.Com, Holland The company is based in the Netherlands, however, most business is done in the U.S. Booking.com counts 10 million room night p/y and they do look for additional hotels in St.P./C. Head office will take care of this request. 20. Colette Ernst, Head of Product North America, Kuoni Travel Ltd., Switzerland We have supported Kuoni for several years by placing our ad in their full year catalogue. We also have participated in the operators introduction promotion to the Austrian market last year. Kuoni will come up with some suggestions and we do plan at least one joint activity with this important company. 21. Ellen Persons, FTI Touristik, Germany / with their own receptive office in Orlando sales for our region have considerably gone up for last winter and this year s summer season. Reason seems to be that there were no major hurricanes in We discussed our upcoming training trip in May. Other joint programs will follow this year. 22. Arjan Helle, Managing Director, Inside Travel News, Holland He suggested a joint mailing to Dutch travel journalists. We shall get a more detailed proposal. 23. Leo Duijvestijn, General Managing Director, Buitenhof, Holland The company specializes on group travel for mentally handicapped people. The groups consist of 12 to 26 passengers with several guides. The operator is looking for a property in St.Petersburg/Clearwater to accommodate his groups and has started talking to the Dolphin Beach Resort. Will check with him if we can be of further help. 24. Jane Zoutendijk, Commercial Specialist, U.S. Commercial Service, Holland the Dutch Visit USA Committee organizes a workshop for 100 to 150 agents in November We definitely plan to participate in this event. 25. Tom Dedek, Director of Sales, tomontour.com, Germany The company publishes the first USA Gayfriendly Guide. We have supported this magazine with a full page ad and have already requested approval to continue with this promotion. During the month of April we received the following number of inquiries: Trade: 6 Consumer: 29 TRAINING TRIPS 10

11 Our training trip for selected travel agents by tour operator FTI has been completed. A total of 11 agents plus 3 guides will travel on May 4 to Orlando, will then proceed to St.Petersburg/Clearwater on May 7 and stay in our area until May 10. An excellent program has been worked out for the group and our host hotel will be the Belleview Biltmore. PUBLIC RELATIONS Travel writer Ms. Nikole Strziga of TOURS Magazin is back from her trip to Florida. Her first reaction was very positive and she enjoyed being in the St. Petersburg/Clearwater Area. As a result a first short story of the pirates festival in Johns Pass Village is featured already on their website under: We are looking forward to the comprehensive report about her trip soon to be published. We provided YPB & R with a German translation of the new text on the FloridasBeach.com website link for German speaking visitors. For Travel One, one of the leading travel trade magazines in Germany we organized a winning game. Martinair is our airline partner here and we were happy to find with JC Resorts a hotel partner sponsoring a seven night stay in the St. Petersburg/Clearwater Area. We collected logos, pictures, texts and quiz questions from all partners and provided the publishing house with the respective material.the winning game with pictures and logos of the sponsor will be featured on a half page 4c in the Travel One Magazine plus on the Travel One website for more than a month ( TRAVEL ONE stands for hands-on and useful expert information for travel agencies and all other distribution channels of the tourist industry. With their products TRAVEL ONE Magazine, TRAVEL ONE Morning News and TRAVEL ONE Online they reach travel agencies in Germany, as well as service providers and suppliers of the travel industry. The Travel One magazine for travel pros comes out every two weeks on a Wednesday with a minimum of 48 pages and a circulation of more than 23,000. Every travel agency receives a free copy. TRAVEL ONE Online is the up-to-date website for travel pros. Industry news brought to the agents several times a day. TRAVEL ONE Online posts around 20,000 visits a month. The next half page advertisement in Touristik Aktuell was discussed with the publishing house. In accordance with the CVB and YPBR we decided to run the same advertisement as we had two months ago and provided Touristik Aktuell with the respective material. Touristik Aktuell is well known in the travel industry being published weekly now for 38 years. The magazine provides a 11

12 concise and clear coverage of relevant topics. Hot and comprehensive information is in the first place meant to reach travel agents and decision makers in travel agencies. Even the staff in tourist firms, airlines, railway companies, tourist offices, hotels and car rental firms regularly read Tourisitk Aktuell. Numerous specials deepen their salesmen s and expert knowledge. 50 times a year facts boiled down to the point provide topics to discuss as well as information and orientation with a distribution to more than readers. Germany s most successful TV travel channel is Sonnenklar TV, which is part of the FTI group in Munich. From former radio broadcastings, we do know the chief moderator well and have approached him for a possible featuring of our area. We would invite Orlando to participate as well. Michael Foerster has promised to look into it and will make us an offer. United Airlines has offered us a special rate for journalists to be invited to the Ironman Competition which again takes place in St.P./C. in November. Our PR agency will invite two to three travel writers to this event and the Sheraton Sand Key Resort has already confirmed to host them. 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 12