Gloomy outlook for UK tourism

Friday, 06 Sep, 2005 0

UK tourism will endure gloomy trading conditions for months to come as problems pile up for the industry, UKinbound has warned.

The stark message came as July visitor arrivals to the UK, along with forward bookings, showed a marked decrease of 7.4% and 9.3% respectively over the same month last year.

But it was the future outlook which caused most concern.

UKinbound chief executive Stephen Dowd said the figures for August, which have yet to be compiled, are certain to be severely hit following the bomb attacks with the effects lasting well into the autumn.

The July figures, he said, represent “only a small element of the longer term damage to inbound tourism.”

“Many consumers continue to defer travelling to the UK. We now have a difficult and delicate task in attracting these potential visitors back to the UK in the face of continued media coverage and political grandstanding both at home and abroad,” said Dowd.

And terrorism is only one of the problems, he added, with the cost of oil and weak dollar only adding to the troubles.

“The inexorable rise in oil prices, greatly exacerbated by hurricane Katrina, has added cost into every part of the tourism supply chain and is eroding our competitiveness, putting sever pressure on prices.

“As if this was not enough the US dollar continued to slide reaching a four-month low,” he said.

Dowd warned that with other destinations also suffering, there is a danger that reactive and unrealistic discounting could undermine a sustainable recovery.

“These tough trading conditions will persist for at least the rest of the autumn and probably until early next year,” predicted Dowd. “Therefore, despite an excellent first six months of the year we can now expect visitor numbers for 2005 to rise only 1-2% and revenue to remain flat or even falling back slightly.”

Meanwhile, Dowd said the domestic industry remain to be convinced about the new common standards of accommodation after a survey revealed 47% of UKinbound members are unsure whether it will bring any benefits. Just over half saw it as a positive with none believing it will have an adverse affect.

Report by Steve Jones