APD ‘shows little impact on sales’ for long-haul

The operator said bookings for the Caribbean are up 37% overall, despite fears passengers would be put off by having to pay more Air Passenger Duty (APD) than other destinations.Dominican Republic is seeing an 800% increase in bookings; Cuba is reporting a 66% increase; and St Lucia is up 55%.Mexico has seen a bookings surge of 143%, fuelled by demand for ‘value’ among people opting for upmarket all-inclusive packages.

The Caribbean destinations have argued the current APD banding system is unfair, because passengers to the Caribbean pay more than, for example, passengers to the US, even though flight times are similar.

However, H&J said bookings to the Caribbean are showing an increase of 24% after April when the next hike in APD takes place.

Niel Alobaidi, commercial director, said: ‘While there has been negative reporting about the possible implication of the Air Passenger Duty tax in April, we do not believe we are seeing any direct impact from this at all.

‘Looking at bookings in 2012 to date, the overall value of the holiday is the key driver of customer demand, and customers are not actively breaking down the cost of individual components within the package.’

H&J says the increase in long-haul bookings ‘is not a worldwide phenomenon’, adding: ‘British tourists seem to be opting for destinations they perceive to be safe from the troubles that have dampened demand for Egypt and Kenya.’

Kenya is ‘sinking under the weight of bad publicity’ according to H&J, although Egypt has seen an upturn over the past month, with bookings up 110% year-on-year.

Alobaidi said: ‘Despite excellent offers for Egypt over the past year, it is only in the last month that we have seen any signs of a positive reaction in the market.

‘We believe that many holidaymakers swapped to Mexico to take advantage of great value all-inclusive packages and it will take time for Egypt to win back business to the levels it enjoyed in 2010.

‘Unsurprisingly, Kenya has performed very poorly in the last few weeks with bookings down 58%.

‘What has surprised us, though, is that South Africa and Tanzania have also seen much reduced booking levels.

‘Previously these destinations have performed strongly whenever Kenya has suffered, as customers switched to another area. This time, however, the current issues appear to be affecting demand across eastern and southern Africa as a whole.’

Dubai and Mauritius are the only long-haul eastern destinations that have done well this year.

H&J says this is because of their move to offer all-inclusive properties.

Dubai’s bookings are up 28%, while Mauritius has seen bookings rise 24% overall year on year – rising 141% a year for resorts that offer all inclusive packages.  By comparison, sales of Sri Lankan packages have fallen by 43%.

H&J’s top destinations are:
1.    Mexico
2.    St Lucia
3.    Las Vegas
4.    Dubai
5.    Dominican Republic
6.    Barbados
7.    Mauritius
8.    Cuba
9.    Penang
10.  Khao Lak

 

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