There have been no shortage of polls looking into Brits’ travel intentions at a time the cost-of-living crisis is eating into budgets and forcing households to make really tricky decisions.

The consensus seems to be that bookings will hold up but spend will fall as people hunt out bargains.

A summer holiday is seen by many people in the UK as a necessity; a chance to recharge batteries, make memories and crucially provide an affordable and sunny bright spot amidst the humdrum of day-to-day life.

But with warnings from airlines and travel operators that prices are set to be higher this summer there are big questions about how that might impact travel trends. Which companies might end up the year’s big winners and which might be disappointed with their post summer scorecard?

Post lockdown the landscape has changed, you cannot expect to close down a global industry and there not to be casualties. Capacity in some of the most popular tourist hotspots is likely to be under pressure and where there’s demand there’s inflation.

It is no surprise Europe is one of the areas that has seen travel rebound strongly though the Middle East, with its affordable winter sun, has recovered fastest according to figures from the UN’s World Tourism Organisation.

In the wake of pandemic cancellations and post-lockdown uncertainty people flocked to the security of the protected package deal with TUI (TUI), Jet2 (JET2:AIM) and EasyJet (EZJ) big beneficiaries. But will that still be the case this summer or will higher prices push people back into DIY breaks?

Airbnb (ABNB:NASDAQ) fell out of favour with investors in 2022 but the share price has rebounded strongly since the start of 2023 after the company lifted revenue guidance. Travel is returning to post-pandemic norms and that means it is not just about a beach and bar especially for holidaymakers wanting to get more bang for their buck.

With confidence growing that global restrictions are fading into memory, wanderlust is returning. Getting off the beaten track does not just mean impressive holiday photos it can also mean more space for families fed up with the limitations of sharing a single room.

What is interesting is how Airbnb has evolved over the years. It is not just the famous free sofa that kicked off the idea for the company’s founder, hosts are becoming more professional, turning their side hustle into a serious business which is upping services but could also create price creep.

BEATING PRICE CREEP

Price creep is one of the reasons that all-inclusive breaks could deliver the biggest opportunity for operators this year. The initial spend is higher, but it does give holidaymakers the peace of mind that every ice cream cone and pool bar cocktail has already been covered by the bill.

Consumers are getting savvier with every passing year and search engines and apps are making their job easier. They are not just looking for the cheapest flights to their destination of choice and thinking that’s job done anymore. They are factoring in accommodation costs, exchange rates, meals and activities as well.

The British tabloids are full of money saving tips, from the best day to book, to under the radar destinations where the price of a cold beer is way below that charged in popular hotspots.

Getting as many bums on seats on flights to those popular hotspots is the way budget airlines make a good chunk of their money but with warnings about price rises to all destinations it will be interesting to see how the consumer responds and how their decision-making impacts profits.

WILL THE “STAYCATION” GET A MONEY  SAVING BOOST?

There is one other factor to stir into the pot and that is the potential some people may ditch the foreign holiday altogether this year either because of price or because disruptions like strikes make long distance hauls seem too much trouble.

Britain has a booming holiday sector which Brits turned to in their droves during the pandemic. It avoids airports, long-stay parking costs and you can also take your dog with you, which can save a fortune in boarding costs.

But you cannot guarantee the weather and parents know full well that a beach on a sunny day is about the cheapest entertainment you can find and that being stuck in a caravan or holiday let in the rain is tantamount to torture.

There is a whole host of companies from Premier Inn owner Whitbread (WTB) to pub chain Wetherspoons (JDW) that will be hoping this summer will not deliver the worst scenario of all – when the lion’s share of holidaymakers flock to sunnier climbs and no one has cash left over for a cheeky short break.

There is the prospect of a May filled with bank holidays thanks to an extra-long weekend for the King’s coronation but with prices still heading up and a whole load of people facing increased mortgage costs this year disposable income is likely to be in short supply.

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