Massive overcapacity in the package holiday market will lead to further consolidation and bankruptcies, according to Noel Josephides (left), deputy chairman of the Association of Independent Tour Operators (AITO) and managing director of Sunvil Holidays.
Noel Josephides said there had been more holidays on sale this summer than ever before.
“I’ve been in the business for 33 years and this is the first summer that I haven’t seen a single overbooking,’ Josephides told TravelMole.
“There are just so many flights and so much accommodation. All the resorts are just building more and more hotels. This is why there are so many discounts in the market to try to get rid of the holidays.
“It can’t go on. The golden age for low-cost airlines is over because everyone is piling into the market and the inevitable consequence is further consolidation and someone – either a low-cost airline or a tour operator – will go bankrupt.”
Josephides, who is also managing director of Sunvil Holidays, said the massive growth of low-cost airlines on leisure routes had destabilised the market.
“If you look at the low-cost airlines together, they have probably put on as much capacity as Britannia Airways (TUI’s airline) has in total.
“We’re talking about a couple of million extra seats coming on to the market.”
Josephides said the events of last September 11 had not deterred people from travelling to the Mediterannean.
“I think the package holiday market is down about 10%, but overall the market is only down by around 2%, because you have had people switching to low-cost flights.
“The problems are simply because of overcapacity. I don’t think it has got anything to do with September 11. Frankly, the British mentality is that they will get on a flight if it is cheap enough.”
Josephides said the industry had suffered a poor August and September and late deals are now available for as little as £79 for a week’s self-catering in Greece. There are also bargains to Spain, the Balearics and Cyprus.
“We’re stuck with discounting,’ said Josephides. ‘If you want to stamp it out you’ve got to tighten th
