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April 30, 2010
Online Travel Industry on the Way Up
New research commissioned by Kelkoo shows that the online travel industry is on the way to recovery and growth, despite poor performance in the past couple of years.

According  to  Kelkoo, there  could be a drop  in  travel  expenditure this  year  that
may translate to as much as €1.6 billion (0.4%). This past month’s Icelandic volcano ash crisis that crippled international airports, could affect that forecast even more.  While overall expenditure figures before the 2008 recession stood at €400 billion, 2009 saw a dramatic decrease of 7.8% to €368.9 billion. 

Nevertheless, Kelkoo showed cautious optimism that online travel would influence the overall travel expenditure very positively, with a predicted turnover of €74.3 billion. This makes up 20% of the total amount spent by travelers in 2010. 

The Kelkoo report examined a number of factors, including the influence of the latest ash crisis on the European travel industry. Airlines have reported losses of €180.4 million per day due to the crisis, according to the advertising platform. 

“It is likely that demand for travel will be negatively impacted by the disruptions from the volcano eruptions,” said the MD of Kelkoo, Bruce Fair. “We would expect a significant share of consumers to alter their travel plans as long as there is the risk of further eruption impacting air traffic, which could be the case over the next few months.

The report also pinpointed France, Germany and the United Kingdom as the countries whose citizens spent the most money on travel. In total, these countries made up 58% of the travel sales on the continent. Further, Kelkoo predicted that the price of tickets would increase in the short term, due to the fact that full capacity still needs to be restored in certain areas. There is little chance that prices will come down, said Fair, as margins are tight and airlines are still trying to recoup their losses.
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