TUI Travel Sees Higher Demand in Europe, But Not the U.S.

In its first-quarter financial report, wholesaler TUI Travel PLC reported that demand is improving, but not on this side of the Atlantic. European customers who had delayed the purchase of vacation packages in the early booking season have “started to return to the market,” TUI Travel said.

Improved demand for vacation packages in Europe, coupled with capacity cuts, boosted pricing levels, the company said. TUI Travel said it was almost fully sold for the 2008-09 winter season.

However, TUI Travel’s “specialists and emerging markets” division, which includes U.S. tour businesses, saw a 15 percent decrease in sales “as the ongoing weakness in U.S. consumer confidence has led to a later booking period environment,” according to TUI Travel.

Sales were down 7 percent in the activity sector, which includes TUI’s marine and adventure businesses in the U.S. Capacity was cut in the marine segment by 15 percent.

For the quarter ended Dec. 31, TUI Travel reported an operating loss of $51 million, compared with a $93 million loss a year earlier. Revenue for the quarter increased 9 percent to $4 billion, compared with $3.7 billion one year prior.

TUI Travel was formed in September 2007 when First Choice Holidays and the tourism division of parent company TUI AG completed their merger.