Will US travel to Europe dry up?

The prospect of a fall in American travellers to Europe due to unfavourable exchange rates is to be a central discussion at next month’s European Tour Operators Association conference.

The US is the largest market for inbound tourism to Europe, which representing an annual spend of $40 billion. 

While the US dollar is at its weakest against both sterling and the euro for 15 years, demand has shown itself to be surprisingly resilient, according to ETOA. 

Executive director Tom Jenkins said: “We normally expect demand for Europe to track currency fluctuations. A strong dollar normally sees a surge in demand, a weak dollar a drop.

“Indeed, the collapse in demand for Europe from America in 2003 probably had more to do with the state of the currency than reaction to 9/11.

“What is surprising is that the connection between currency and demand has not been absolute. Since 2003 we have seen consistent growth in European arrivals from the US, despite a decline in the value of the dollar.

“If we were to have another return to the dollar’s historic levels against European currencies, demand from the US could become overwhelming. 

“However, if the slide continues and an adverse event takes place, such as a terrorism strike, demand could suddenly dry up.

“It is worth noting that during the late 1990’s the growth from America delivered an additional million visitors per year – substantially more than the total number of visitors from China”.

The US market will be the main subject of the morning session of the ETOA conference at the Global European Marketplace (GEM) on November 9 at Earls Court, London.

There will be a presentation on how to identify promising source markets by David Edwards, VisitBritain’s head of statistics, and Simon Carkeek, executive director of Eye4Travel, will unveil new research in to the behaviour of US consumers online.

The main debate will take place between Arnie Weissmann, editor in chief of Travel Weekly US and William Maloney, CEO of the American Society of Travel Agents. 

They will reflect on the developments in travel distribution in the US and forecast what is likely to happen in the future. They will address several questions, including:

• Will travel agents continue to be relevant?

• Is the internet a threat to their existence or can it be used to help a distribution channel that still sells the most expensive packages?

• The internet appears to be empowering consumers: is this a threat or an opportunity?

by Phil Davies

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