Double-WYSKs – British Airways, Skyscanner

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FOXTROTS*

 

Travel Industry Data News, December 2-6

From http://www.travelbusinessanalyst.com

 

 

Double-WYSKs – British Airways, Skyscanner

(WYSK = What You Should Know)

 

I present two crying reviews. A critique of a critique on British Airways in The Economist, and my own dismantling of a report by Skyscanner on Singapore outbound travel.

 

The reason I have written these is that both organisations – The Economist and Skyscanner – are well respected in their fields. Thus their comments and commentaries would normally have more credibility. In addition, because of that respect, they should be held to higher standards.

 

Ironically, I was also encouraged by a (separate) report in The Economist ‘Clear as mud’, writing about poorly-presented and badly-worded reports in learned journals and/or from learned institutions.

 

 

British/ICAG

The theme of The Economist (TE) report was that BA’s ‘dominant position’ at London Heathrow airport should be ended. In the course of presenting that theme, UK-based TE made many comments/points that I believe deserve comment in turn.

 

[] BA’s dominant position is a result of what TE usually likes – open bidding for flight-departure times at Heathrow. TE does not clearly note what it wants in exchange – except that some BA slots should go to Virgin Atlantic. Why? And why not to others? Does TE want to exchange one near-duopoly for another near-duopoly?

 

[] BA ‘pioneered’ supersonic travel with the Concorde. It failed to note a second ‘pioneer’ – Air France.

 

[] Notes that ICAG (International Consolidated Airlines Group; AerLingus British Iberia Level Vueling, plus), which was formed in 2011, has ‘taken in’ (among others) Level. In fact, ICAG created Level in 2017. TE also did not note that ICAG shut down its disastrous performer Open Skies (an airline, despite that name), partly to make way for Level.

 

[] Describes AerLingus as an FSA* but ‘thrifty’ – whatever that means.

 

[] ICAG has more ‘lucrative’ seats on Europe-North America than any other. I don’t know if TE means ‘premium class’ seats, or that all North Atlantic routes are ‘lucrative’ (which may or may not mean ‘profitable’). Most commentators note that NAm is lossmaking because of competition. My database indicates ICAG has about a capacity share of 20-25%. In terms of airline alliances, Sky Team has about the same, and Star 25-30%.

 

[] TE compares ICAG with ‘Air France-KLM’ and Lufthansa, which it describes as ‘legacy’ airlines. ‘Legacy’ is a meaningless airline business term, never clearly defined by anyone. Under my definitions* these would be FSAs. But surely TE knows these two airlines are also part of groups, similar to ICAG?

 

AF-KLM also have Transavia, an NFA. (AFKL also established Joon, loosely a hybrid, in 2017, but shut it down in 2019; I reported from the beginning, before it was even named, that its business plan would not work).

 

Lufthansa is part of a giant group that includes Austrian, Brussels, Swiss, all FSAs, as well as Eurowings, a hybrid.

 

My database shows the AF group sold 101mn seats in 2018, ICAG 113mn, the LH group 142mn.

 

[] TE notes that on shorthaul routes BA (parts of its report seem to treat BA and ICAG as one) charges for food, checked-in baggage, seat allocation. It does not note that most FSAs do this on intraEurope routes – or no more than a free sandwich with coffee.

 

[] BAs intraEurope routes feed its ‘lucrative longhaul’ flights from London, reports TE. From this we infer that all BA’s routes except shorthauls are ‘lucrative’, an undefined terms which generally is assumed to mean ‘very profitable’. We cannot believe that all BA’s non-shorthaul flights are profitable.

 

[] TE makes other statements that look questionable to me, but without data is difficult to analyse:

 

-‘London is the world’s biggest and most lucrative aviation market.’ Perhaps, but there are 4/5 airports serving London, yet TE’s arguments concern just one, Heathrow. And that word ‘lucrative’ again. Would TE really back that statement? Does it mean the city’s GDP is the highest in the world – although a city’s GDP does not necessarily conflate with its ‘aviation market’?

 

-‘Heathrow is ideally positioned to serve the money-spinning North Atlantic routes’. So Amsterdam, Dublin, Frankfurt, Paris, plus the other London airports, and more, are badly positioned for the North Atlantic?

 

[] BA has 50% of slots at Heathrow plus 5% more for the whole ICAG group. TE compares that with the next largest, Lufthansa, which has 8% at Heathrow. But of course, the comparison should be with LH at Frankfurt or Munich, or AF at Paris CDG. My database indicates Lufthansa itself has 55-60% at Frankfurt, and 60% at Munich. Add in the group and probably 10 points can be added. In other words, a higher share than BA at London Heathrow.

 

[] TE criticised BA’s results in China. It’s true; my database indicates seat sales on UK-China routes are only 61% of Germany-China routes, and 70% of France-UK routes. Does TE know the principal reason? Visas for Chinese nationals. Only one visa for the 26 countries in the Schengen agreement, including France, Germany, Italy. And one for just the UK. (A visa for the UK alone may cost over US$100 that about US$75 for all 26 Schengen countries.)

 

Many tourists from China want to see more than one country when they travel to Europe, but they might not bother if it means another visa. Blame that on UK governments, who follow the wishes of the UK people – no free movement to other parts of Europe.

 

[] Finally, TE notes that ICAG’s share price is ‘down 30% since a peak in mid-2018’. This is irresponsible playing with figures. Try the following instead, which seems to indicate that reality is much more nuanced, and does not allow trite comment:

 

-End-2018 over end-2017: ICAG -5%, AF -30%, Easyjet -25%, Lufthansa -36%, Ryanair -29%.

-End-Nov-18 over end-2018: ICAG -10%, AF +13%, Easyjet +21%, Lufthansa -12%, Ryanair +29%.

-End-Nov-18 over Jun-18: ICAG -17%, AF +53%, Easyjet -20%, Lufthansa -17%, Ryanair -12%.

 

 

 

Skyscanner

UK-based Skyscanner (SS), now a subsidiary of China’s Trip (which also owns cTrip) has issued a report on Singapore outbound.

 

As much is qualitative rather than quantitative, I would not normally offer any analysis. But as so much is misleading, and sometimes nonsense, that I have attempted analysis – also in part because of SS’s generally positive reputation in the industry.

 

Also, I note that SS generally reports and analyses its own operating data. That is not the same as the travel business, or even a big part of it; hopefully SS management is aware of that.

 

[] SS calls itself ‘the leading authority and expert in travel’. I would like to believe that such nonsense is the work of a junior writer, although the statement does appear in its report more than once. I would like to know, at least, where it places others in terms of expertise – for example, its own parent, Trip, or, say, IPKI/ITB-Berlin, Phocuswright, WTO, WTTC? And even, I proffer humbly, Travel Business Analyst?

 

[] ‘Singaporeans are flocking to idyllic locations with a meandering pace of life [instead of] classic holiday locales, as a means of escape from their busy lives.

 

  1. I presume SS is referring to Singapore resident travel, not just nationals.

 

  1. ‘Flocking’ indicates high volumes, which presumably makes its ‘idyllic locations’ (none are identified) busy places – thus no longer ‘idyllic’? Are all Singapore residents ‘escaping’ when they travel, and all have ‘busy lives’?

 

[] ‘Slow Travel and Micro Escapes’ are becoming a ‘mainstay’ as more seek ‘shorter respites from day-to-day stressors’, while ‘indulging in little luxuries for added comfort’.

 

That’s a cornucopia of categories to apply to (all?) travellers. I would like to see some qualifiers of, at least, ‘mainstay’, ‘shorter’, and, for fun, what those ‘little luxuries’ are.

 

Travellers in 2020 will ‘flock’ to ‘quaint villages, small towns, idyllic farms’.

 

SS reports 19% +20% have booked to ‘travel slower’. That’s growth from 16% share, and so not a big change. SS does not note which category lost share. Named as ‘exotic’ Slow Travel destinations are Budapest, Takamatsu, Chiangmai, Saipan.

 

‘Exotic’ is one of those adjectives used frequently, often by travel writers, but never explained; mostly, it seems to be far-away destinations – so perhaps Paris for Singaporeans, and Singapore for Parisians. No non-exotic destinations are listed.

 

[] Micro Escapes. SS reports 20% booked Micro Escapes this year (not 2020 as for Slow Travel data) – defined as trips of 3-7 days. Top-5 are Bangkok, Manila, Kuala Lumpur, Seoul, Taipei.

 

That seems a mundane list for such an eclectic selection of travellers. Except that Hong Kong is missing, and of course 3-7-days would fit the category of most travellers (Hong Kong’s average length-of-stay is under four days). So does this mean SS has collected data for this report during the time of Hong Kong’s demonstrations – so it does not show highly?

 

[] Getaway Destinations (but also described as Emerging and Off-the-beaten-path destinations, which are not the same thing – although surely 100% of destinations are ‘getaways’? Whichever, 75% of these are in Asia Pacific; strongest growth was Vietnam. Year not given.

 

Named an off-the-beaten-path destination is Trivandrum (bookings growth +61%). ‘Off-the-radar’ (which means technically that it cannot be found!) destination Kunming (bookings growth +42%).

 

[] Small luxuries. This year +50% growth in sale of ‘premium economy flights’ (SS means tickets, because there are no PE flights), +18% business class. SS says PE fares have fallen -9%, business class -5%; period not given. Few airlines have PE cabins, and for those that do, the seat capacity share is around 15%, so SS’s +50% might be +50% of a small number.

 

Contradicting in part some of the SS themes in this report, is its statement that savings of 28% can be made by avoiding ‘popular’ days of departure. Also, ‘Best-Value Destinations are great alternatives to popular but pricier destinations’. Again, ‘popular’ is a part contradiction of what it has said elsewhere.

 

SS names some price falls – Kolkata -19%, Fukuoka -13%, Kota Kinabalu -20%. These are ‘more affordable’ than counterparts Delhi, Tokyo, Kuala Lumpur. Dates not given, but that is not really important as I presume those cities have been cheaper than those listed counterparts since forever.

 

Finally, SS – when describing itself (‘About Us’) – says it was the object of ‘multiple high-profile investment rounds, including from Silicon-Valley based Sequoia Capital’. And that after those funding inputs, although it was acquired by Trip in 2016, it ‘remains operationally independent’.

 

I find those statements anomalous. It notes the location of Sequoia (Silicon Valley, US) but not that Trip is a China-owned company. And why add that it is ‘operationally independent’? Is SS ashamed of its China connection?

 

 

*Notes: Following are my airline-type definitions:

 

Airline groups selling at least 75mn seats/year should have these three types of airline.

 

FSA=full-service-airline. Offering first/business/economy, travel agency bookings, meals/bookings/baggage/cancellations included, etc. As its name indicates – full service. May be, or could be, similar to Hybrid, see below.

 

LCA=low-cost-airline. (Not a no-frills-airline; see next.) An FSA but with lower operating costs – cheaper longer-hours flight-deck crew, younger/new longer-hours cabin crew, tighter cost control (twinned 3-star hotel rooms, for example), fewer fare types, may have first and business cabins as well as economy, and which allows bookings through travel agencies etc. If relevant, usually similar to the parent airline, but a different name, and competition against parent airline allowed. May be, or could be, similar to Hybrid, see below.

 

NFA=no-frills-airline. We believe that among the many essential elements that make a successful NFA are: shorthaul point-to-point routes; market freedom in terms of fares, routes; single aircraft type; where relevant, competition against parent airline allowed; extremely-low fares when bought at least three months in advance, say US$25; one fare at one time (no wholesale rates, travel agency commissions, etc); no refunds; no (free) service frills; single economy-class cabin; no (free) seat selection; two toilets for 150-seat aircraft; 25-minute turnaround time; cabin crew do daytime cabin cleaning; name and flight change charged at least US$25 each; no trade shows; plenty of consumer advertising and promotion; and much more. Developments in technology are making some of these ‘requirements’ less important.

 

Hybrid. Just that; a mix of types. Technically, most FSAs and LCAs are Hybrids, in that they offer a variety of services for a variety of prices. Because of this looser definition, this airline-type is not one of the three types defined above.

 

 

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

Travel Industry Data News, December 2-6

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Travel Industry Data News, December 2-6

From http://www.travelbusinessanalyst.com

 

TBA Tracking: November travel stocks’ ups and downs; unstructured/wild variations

6 December 2019

Travel stock prices (Asia Pacific, Europe, US) in November. Airlines: biggest growth, SAS +33%; biggest fall, Norwegian -12%. Hotels: Jinjiang +20%, NH -3%. Travel-Tech: Amadeus +9%, Trivago -33%. China travel stocks (new): China United Tvl +8%, China International Tvl -7%. Others: Walt Disney +17%, Genting -15%.

Previous month: Airlines: biggest growth, Norwegian +23%; biggest fall, Thai -17%. Hotels: Peninsula +18%, InterContinental -7%. Travel-Tech: cTrip +11%, Trivago -11%. China travel stocks (new): Air China +4%, Hainan Airlines -5%. Others: Airbus +11%, Boeing -9%.

TBA Travel Stocks Index: World 226, Asia Pacific 80, Europe 213, US 384. Index previous month: World 225, Asia Pacific 79, Europe 199, US 398.

TBA China Travel Stocks Index (new; quotes from China, Hong Kong, US): 96; previous month 93.

NVTT (Net Value Travel Tech) Stocks Index: 151; previous month 156.

Stockmarkets. Biggest growth New York-Travel Weekly +9%; biggest fall Kuala Lumpur -2%. Previous month: biggest growth Frankfurt +7%; biggest fall New Zealand -1%.

Commentary:

-Wild moves that make calm analysis difficult.

  -Sample 1: 5 of the 25 stockmarkets we track fell – in most months there might be one or sometimes two. However, three did particularly well – Istanbul was just a fraction below Travel Weekly, and Dublin was +7%.

  -Sample 2: Expedia, generally considered a strong OTA, fell 26%. That was not the worst – Trivago was, as now usual, the worst – but was still a bad sign. Indeed, half of our eight travel-tech stocks fell.

  -Sample 3: SAS growth looks impressive, but it is still below its end-2018 price and 70% of its peak in 2016.

  -Sample 4: Fellow Nordic airline Norwegian was the worst performer – having been the best the month before!

-Of the regions, Asia Pacific was weak, Europe fair, US fair-to-good.

Among our 5-airlines quotes in China, four fell, although three of them that are also quoted in Hong Kong grew.

-No-frills-airlines had a good month – except Air Asia, which has been tripping down most of this year, and is now almost at half its end-2018 price.

-Hotels in general performed well, helping the indices stay positive. In addition to Jinjiang, three heavyweights did well – Choice +10%, InterContinental +7%, Marriott +11%.

-‘Others’ also had some good performers in addition to Disney – Hertz (usually a bad performer) +15%, Royal Caribbean +10%.

-Europe’s big-3 airline groups had varying results – AFG -0.2%, ICAG +4%, LHG +11%.

-China stocks (including those quoted outside China) mixed – five of our 15 fell (one, an HNAG stock, remained suspended, in Hong Kong).

-Hong Kong’s Cathay is holding on after falling furthest in September – although it is still below its end-2018 price.

-Aircraft makers shrug off bad news. US tariffs on Airbus planes has not stopped its price rising, +3%, and +50% on its end-2018 price. Boeing is only +15% on its end-2018 price despite the continued grounding of its B737max, and +8% for the month although its October price was its lowest in the year.

Info from Travel Business Analyst. Details in next month’s editions of WYSK:What-You-Should-Know, published by Travel Business Analyst.

 

Travel business updates

5 December 2019

[] Global Data*, a data and analytics company, forecasts travellers from Japan to France will grow from 1.1mn this year (presumably GD’s estimate as the year has not finished) to 1.3mn in 2023.

GD shows a +4.6% average annual growth rate; we calculate +4.3%. This total appears to be departures from Japan, not arrivals in France.

*Notes: We have found in other reports that Global Data sometimes misreads/misinterprets/misreports core travel data – apparently mostly due to imprecision in its editorial commentary. At press time, GD had not answered our request for clarifications.

[] IATA (International Air Transport Association) reports for October RPKs +3.4%, ASKs +2.2%, load factor 82.0% +0.9 pt. RPKs by region – Asia Pacific +3.6%, Europe +2.2%, Middle East +5.5%, North America +3.9%.

International RPKs +3.2% – Asia Pacific +3.8%, Europe +2.1%, Middle East +5.9%, North America +4.1%.

Domestic RPKs +3.6% – Australia +1.8%, Brazil +3.9%, China +5.3%, India +3.6%, Japan +1.5%, Russia +5.6%, US +4.1%.

[] PCW (Phocuswright, a travel research company specialising in online data) forecasts France’s travel market (definition not known) will grow from US$52.2bn (at US$1 to €0.90) this year (presumably PCW’s estimate as the year has not finished) to US$55.4bn in 2023.

We calculate that would be +6.2% growth, a +1.5% annual average growth rate.

[] STR (nee Smith Travel Research) reports on US hotels 24-30 November: occupancy -11.6% to 50.6%, average room rate -6.7% to US$112.28.

 

Europe outbound

4 December 2019

II* on outbound travel from Europe, over Jan-Aug:

-Trips +2.5%; world +3.9%.

-‘Last year’ (we presume Jan-Dec 18, not Jan-Aug 18) +5%.

-Selected (by II; reason, and reason for order, not known) from West Europe: from Germany +2%, Netherlands +2%, Switzerland +2%, Italy +3%, France +3%.

-Selected (ditto) from East Europe: from Russia +7%, Poland +6%, Czech R +5%.

-Trips intraEurope +3%, to Asia +2%, to America (believed to be US, not Americas or North America) +3%.

-To Spain +1%. ‘Outperforming’ (presumably meaning above average, but figure not known) – Turkey, Portugal, Greece. To Germany +4%. To UK -5%.

-Holiday trips +3%. City Breaks (included in ‘Holiday’) +7%. Countryside* +5%, Cruises +5%. Sun & Beach (‘most popular’; share not known) +2%. Roundtrips* +1%.

-IPKI forecast +3-4% in 2020, which it notes would be faster than for this year – but 2019 estimate not given.

*Notes:

-II=Germany-based IPK International (IPKI), a research company, with ITB Berlin (ITBB), the big travel trade exhibition in the city. Unfortunately, II are often casual in reporting their findings, although we believe they are precise in their research work.

-For ‘holiday travel’, we believe II mean non-business travel, sometimes known as ‘leisure travel’.

-In 2019, II introduced ‘roundtrips’ as a category in some reports. There has been no further definition although the term makes no sense, as presumably around 95% of trips are roundtrips.

-This report also introduces ‘Countryside’; definition not known.

-In other reports, II have had a category ‘tour (sometimes ‘touring’) holidays’ (II has also never defined this, and as it is open to interpretation, we wonder how those questioned defined it).

-At press time, II had not answered our request for clarifications.

-A full report on this topic in our WYSK:What-You-Should-Know monthly-report contains some important additional information, qualification, and analysis.

 

Travel business updates

3 December 2019

[] STR (nee Smith Travel Research) reports on Middle East hotels in October: occupancy +6.5% to 67.6%, average room rate -3.9% to US$143.62.

[] STR (nee Smith Travel Research) reports on US hotels 17-23 November: occupancy +17.7% to 61.2%, average room rate +10.8% to US$124.71.

[] Luxembourg-based Corporacion America Airports, which operates 52 airports mainly in Latin America (in Europe in Armenia and Italy), reports passengers-handled in Q3 at 22.5mn +1.4%.

[] Greece’s DMO reports October air arrivals +5.7%, YTD +3.5%. Bank of Greece all arrivals September +5.0%, YTD +3.8%; spend +16.0%, YTD +14.0%.

[] US’s DMO reports* latest (with previous ones changed) US resident departures and visitor arrivals. In brief, for Jan-Sep, RDs +6.9%, VAs -1.0 – RDs getting worse, VAs getting better.

*Notes: A full report on this topic in our WYSK:What-You-Should-Know monthly-report contains some important additional information, qualification, and analysis.

 

China outbound

2 December 2019

Trip* and Union Pay (together ‘TUP’) have published a report on China outbound travel. Some excerpts:

-Government figures report that outbound spend by China nationals (probably just Chinese nationals living in China, but despite the definition, probably also including foreigners resident in China) was US$127.5bn. Period not given; our database, from WTO data, shows US$277.3bn +5.2% in 2018 with a -4.4% fall in Q1 2019. As the TUP and WTO figures are so different (TUP’s is half WTO’s) qualification is needed. WTO adds-up spend in destinations by visitors from China (but sometimes Chinese visitors if the destination measures that way). TUP do not define their methodology.

-Chinese travellers this year visited 158 +17% countries.

-Top-10 sources in China this year were Guangdong, Shanghai, Beijing, Jiangsu, Zhejiang, Sichuan, Hubei, Shandong, Fujian, Liaoning. We presume this is in order of size.

-Top-10 shopping destinations this year were Japan, UAE, UK, France, Singapore, US, Spain, Korea, Italy, Australia. We would normally presume this list is in order of size, but we would question some, and thus presume TUP have a different methodology.

-Female travellers accounted for 55% share of outbound travellers who shopped. We believe as stated this is worthless data; if husband-and-wife enter a shop together, how is breakdown made?

-Average shopping spend per person was 1.15-times higher for male travellers.

-Orders for museum tickets grew +105%, orders for ride-hailing grew +300% with average per-person spend US$10 (at US$1 to Y7.04), orders for local tour guides grew +40% with average spend US$114.

*Notes:

-Previously cTrip, now a group that includes cTrip, Qunar, Skyscanner.

-For period listed as 2019 (‘this year’), we presume this is approximately YTD, say Jan-Oct.

-No data given for Hong Kong and Macau, and as these are major destinations (despite the present problems for travel to Hong Kong), we presume these are excluded.

-At press time, TUP had not answered our request for clarifications.

 

 

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

TBA Tracking: November travel stocks’ ups and downs – unstructured/wild variations

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TBA Tracking: November travel stocks’ ups and downs – unstructured/wild variations

 

Travel stock prices (Asia Pacific, Europe, US) in November.

 

Airlines: biggest growth, SAS +33%; biggest fall, Norwegian -12%.

Hotels: Jinjiang +20%, NH -3%.

Travel-Tech: Amadeus +9%, Trivago -33%.

China travel stocks (new): China United Tvl +8%, China International Tvl -7%.

Others: Walt Disney +17%, Genting -15%.

 

Previous month:

Airlines: biggest growth, Norwegian +23%; biggest fall, Thai -17%.

Hotels: Peninsula +18%, InterContinental -7%.

Travel-Tech: cTrip +11%, Trivago -11%.

China travel stocks (new): Air China +4%, Hainan Airlines -5%.

Others: Airbus +11%, Boeing -9%.

 

TBA Travel Stocks Index: World 226, Asia Pacific 80, Europe 213, US 384.

Index previous month: World 225, Asia Pacific 79, Europe 199, US 398.

 

TBA China Travel Stocks Index (new; quotes from China, Hong Kong, US): 96; previous month 93.

 

NVTT (Net Value Travel Tech) Stocks Index: 151; previous month 156.

 

Stockmarkets. Biggest growth New York-Travel Weekly +9%; biggest fall Kuala Lumpur -2%.

Previous month: biggest growth Frankfurt +7%; biggest fall New Zealand -1%.

 

Commentary:

-Wild moves that make calm analysis difficult.

 

  -Sample 1: 5 of the 25 stockmarkets we track fell – in most months there might be one or sometimes two. However, three did particularly well – Istanbul was just a fraction below Travel Weekly, and Dublin was +7%.

 

  -Sample 2: Expedia, generally considered a strong OTA, fell 26%. That was not the worst – Trivago was, as now usual, the worst – but was still a bad sign. Indeed, half of our eight travel-tech stocks fell.

 

  -Sample 3: SAS growth looks impressive, but it is still below its end-2018 price and 70% of its peak in 2016.

 

  -Sample 4: Fellow Nordic airline Norwegian was the worst performer – having been the best the month before!

 

-Of the regions, Asia Pacific was weak, Europe fair, US fair-to-good.

 

Among our 5-airlines quotes in China, four fell, although three of them that are also quoted in Hong Kong grew.

 

-No-frills-airlines had a good month – except Air Asia, which has been tripping down most of this year, and is now almost at half its end-2018 price.

 

-Hotels in general performed well, helping the indices stay positive. In addition to Jinjiang, three heavyweights did well – Choice +10%, InterContinental +7%, Marriott +11%.

 

-‘Others’ also had some good performers in addition to Disney – Hertz (usually a bad performer) +15%, Royal Caribbean +10%.

 

-Europe’s big-3 airline groups had varying results – AFG -0.2%, ICAG +4%, LHG +11%.

-China stocks (including those quoted outside China) mixed – five of our 15 fell (one, an HNAG stock, remained suspended, in Hong Kong).

 

-Hong Kong’s Cathay is holding on after falling furthest in September – although it is still below its end-2018 price.

 

-Aircraft makers shrug off bad news. US tariffs on Airbus planes has not stopped its price rising, +3%, and +50% on its end-2018 price. Boeing is only +15% on its end-2018 price despite the continued grounding of its B737max, and +8% for the month although its October price was its lowest in the year.

 

Info from Travel Business Analyst. Details in next month’s editions of WYSK:What-You-Should-Know, published by Travel Business Analyst.

 

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

Travel Industry Data News, November 25-29

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Travel Industry Data News, November 25-29

From http://www.travelbusinessanalyst.com

 

TBA Tracking: Air passenger counts in France, Germany, UK

29 November 2019

A brief ‘main-points’ review of latest air passenger counts* to/from France, Germany, UK over selected country-pairs in Europe, UAE, US, growth only:

To/from France (Paris only): Germany -3%, UK -2%. UAE -3%, US +5%. All +1%.

To/from Germany: Italy +8%, Spain -5%, UK -5%. UAE -5%, US +3%. All +2%.

To/from UK: Germany -5%. UAE +5%, US +0.2%. All +2%.

*Data from Aeroports de Paris, Statistisches Bundesamt, Civil Aviation Authority, and most excerpted from our WYSK:What-You-Should-Know, published by Travel Business Analyst.

 

TBA Tracking: Airports in Europe

28 November 2019

A brief ‘main-points’ review of latest airport-passenger throughputs, growth only, usually for larger airports:

Main airports: Amsterdam -1%, Berlin (two) -4%, Frankfurt (two) +1%, Istanbul (two) +2%, London (five) +0.1%, Madrid +8%, Paris (2/3) +1%, Rome (two) +2%. All +3%.

‘Low-fare airports’ (those with sizeable portion of no-frills-airline traffic): Berlin Schonefeld -13%, London Luton +8%, London Stansted -0.4%, Milan Bergamo +8%, Palma +1%, Paris Orly -9%. All +2%.

*Data mainly from ACI (Airports Council International), some directly from airports, and most excerpted from our WYSK:What-You-Should-Know, published by Travel Business Analyst.

 

Done deals

27 November 2019

Global Data, a data and analytics company, reports on deals* by companies in the travel business in Q3. Findings include:

[] All deals.

-Deals done worth US$2.58bn +7.1% over Q2, and +35.1% over average of last four-Qs.

-Asia Pacific deals US$1.08bn.

-Country deals: US 25 deals US$731.92mn, China 19, India 10.

-Venture Financing US$7.26bn +121.0%. Top-5 US$1.61bn 62.4% share.

[] US deals.

-Total deals 90 +40.6% over Q2, +20% over average of last four-Qs.

-M&A Deals done worth US$5.61bn -74.8% over Q2, -36.5% over average of last four-Qs.

-US share 40.4% of world total US$13.9bn.

-Top-5 M&A deals US$3.78bn 67.3% share.

[] UK deals.

-Deals done 26 worth US$27.27mn -7.1%, also (sic) -7.1% over average of last four-Qs.

-M&A Deals done worth US$27.27m -99.2% over Q2, -98.7% over average of last four-Qs, 45.2% share.

-US share 0.2% of world total US$13.9bn.

-Top-5 M&A deals US$12.32mn, which we calculate was a 45.2% share.

*Notes: Details as reported by GD. Not all follow standard categorisation.

 

What’s working; what’s not. Airlines in Europe

26 November 2019

Our summary of traffic results* for the leading airlines (not, where relevant, airline groups) in Europe. Seat sales (newly available for British), in alphabetical order: Air France (once again available separated from KLM) +3%; British +1%; Easyjet +11%; Lufthansa +2%; Ryanair +8%.

Notes (on notable details; on whole-group for Air France (=AFKL), British (=ICAG), Lufthansa (=LHG)):

-AFKL +3%, which this year might be described as ‘steady’. KLM also +3%. Transavia +7%, but slowing.

-ICAG +5%. Is Level (sic) not working? Only +9%; as a newish airline, that should be much faster – closer to +20%. Iberia +7%. AerLingus +1%; also too slow. Vueling +6%.

-Easyjet. But its monthly growth was just +2% – for an NFA, this is a collapse. Is this Brexit related?

-LHG +3%. Eurowings (our calculation) -1%. If our estimates are close, it seems that Lufthansa management has messed up again (earlier, management messed up German Wings). Austrian +6%. Brussels (our calculation) +6%. Lufthansa +2%. Swiss +6%.

-Ryanair. And its seat factor holding high, at 96% – but remember it has a misleading way of measuring this.

-Others of note: SAS at -2%, caused by a pilot strike last April.

*Excerpts from the current editions of WYSK:What-You-Should-Know, published by Travel Business Analyst, over January-September.

 

TBA Tracking: Visitor arrivals in Asia Pacific, latest

25 November 2019

A brief ‘main-points’ review of latest visitor-arrival counts*, growth only, usually for larger destinations:

Bali +8%, Hong Kong -34% (from China -35%), India +2%, Philippines +28%, Singapore +3%, Sri Lanka -22%.

*Data from various sources, mainly WTO, DMOs, government departments, and most excerpted from our WYSK:What-You-Should-Know, published by Travel Business Analyst. Months are latest available, but may be different between destinations.

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

What’s working; what’s not. Airlines in Europe

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FOXTROTS*

 

What’s working; what’s not. Airlines in Europe.

ICAG’s Level not working? LHG messing up Eurowings?

 

Our summary of traffic results* for the leading airlines (not, where relevant, airline groups) in Europe.

 

Seat sales (newly available for British), in alphabetical order: Air France (once again available separated from KLM) +3%; British +1%; Easyjet +11%; Lufthansa +2%; Ryanair +8%.

 

Notes (on notable details; on whole-group for Air France (=AFKL), British (=ICAG), Lufthansa (=LHG)):

 

-AFKL +3%, which this year might be described as ‘steady’. KLM also +3%. Transavia +7%, but slowing.

 

-ICAG +5%. Is Level (sic) not working? Only +9%; as a newish airline, that should be much faster – closer to +20%. Iberia +7%. AerLingus +1%; also too slow. Vueling +6%.

 

-Easyjet. But its monthly growth was just +2% – for an NFA, this is a collapse. Is this Brexit related?

 

-LHG +3%. Eurowings (our calculation) -1%. If our estimates are close, it seems that Lufthansa management has messed up again (earlier, management messed up German Wings). Austrian +6%. Brussels (our calculation) +6%. Lufthansa +2%. Swiss +6%.

 

-Ryanair. And its seat factor holding high, at 96% – but remember it has a misleading way of measuring this.

 

-Others of note: SAS at -2%, caused by a pilot strike last April.

 

*Excerpts from the current editions of WYSK:What-You-Should-Know, published by Travel Business Analyst, over January-September.

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

Travel Industry Data News, November 18-22.

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Travel Industry Data News, November 18-22.

From http://www.travelbusinessanalyst.com

 

TBA Tracking: Resident/Citizen departures in Asia Pacific, latest

22 November 2019

A brief ‘main-points’ review of latest departure counts*, growth only, usually for larger markets.

Australia +2%, China (our estimates) +8%, Hong Kong +2%, India (our estimates) +5%, Japan +7%, Korea -4%.

*Data from various sources, mainly DMOs, government departments, and most excerpted from our WYSK:What-You-Should-Know, published by Travel Business Analyst. Months are latest available, but may be different between markets.

 

Travel business updates

21 November 2019

[] ITB China 2020 has started an Inbound Travel segment, resulting in what it reports as 25% growth in hosted buyers to 1050, of which 200 will be China-focused international travel buyers.

Based on our database, that growth is difficult to analyse. ITBC reported only ‘Chinese’ buyers for its event earlier this year, and not other nationalities, and not non-hosted buyers. On that figure, the new segment would mean +23.5% growth.

[] Visitors to North Africa will total 37.4mn in 2021 (GD says ‘ by 2022’), says Global Data. It reports that as +4.8% AAGR (annual average growth rate). Because of big changes in recent years, earlier patterns are not a good guide; our database indicates AAGR was +13.4% over 2015-18 but +3.9% over 2014-18.

 

Hotel business updates

20 November 2019

STR (nee Smith Travel Research) reports on US hotels:

-10-16 November occupancy -3.6% to 64.2%, average room rate -0.6% to US$129.96.

-October occupancy -0.8% to 69.3%, average room rate -0.5% to US$133.34.

-2019 forecast occupancy -0.2% to 66.0%, average room rate +1.0% to US$131.29. Among chain scale segments, only Economy +0.4% and Independent +0.3% are forecast to report occupancy growth, Luxury forecast to have the largest ADR growth +1.9%. (Forecast with Tourism Economics.)

-2020 forecast occupancy -0.4% to 65.7%, average room rate +0.9% to US$132.50. (Forecast with Tourism Economics.)

 

WTTC on medical tourism

19 November 2019

Excerpts from a WTTC* report on medical tourism:

[] US largest market for inbound and outbound spend.

[] US outbound spend, share 20%. US nationals spent US$2.3bn in 2017. Not clear how WTTC can separate-out non-citizens living in the US, and also add US nationals living in other countries.

[] Kuwait 2nd largest outbound spend US$1.5bn in 2015. Note 1, that year is different from US dates, 2, not specified whether Kuwait nationals only, or whether including the large number of foreigners living in Kuwait.

[] Nigeria 3rd largest outbound spend US$783mn in 2017, a 13.5% share of total outbound spend. Not the same category as for the US, which is share of total medical spend.

[] ‘Leading’ (no other definition) emerging destinations for spend – Turkey, Thailand, Jordan, Costa Rica, Mexico. Reason for order not given.

[] Spend on international medical tourism US$11bn in 2017, up +358% since 2000. We calculate that as +9.4% AAGR (annual average growth rate).

[] Medical-spend share 1.2% of total visitor spend in 2017; 0.6% in 2000.

[] WTTC names Europe markets in the top-10 – Netherlands, France, Belgium, Austria, Germany. Again, reason for order not known. Spend in each of the five is put at US$300-678mn.

[] Inbound US spend US$4bn in 2017, a 36% share of medical tourism spend.

[] Following the US, largest inbound spend France US$800mn, Turkey US$763mn.

[] ‘Emerging economies’ for medical tourism noted were Thailand US$589 million 1.0% share of inbound visitor spend, Costa Rica US$451mn 12.1%, Mexico US$315mn 1.5%.

[] Inbound spend; five are European countries, with Belgium, the UK and Hungary joining France and Turkey, spending US$417-636mn.

*Notes: WTTC (World Travel & Tourism Council), a lobby group for the travel business.

 

International travel counts

18 November 2019

Excerpts from II* findings on world inbound and outbound travel over Jan-Aug: (Any rounding by II; see Notes for important qualification/comment.)

-Outbound. Grew +3.9% -1pt. Asia fastest growth +6%; China +9%. North America (II say ‘Americans’) +4.5%. Europe (‘Europeans’) +2.5%.

-Inbound. Asia +6%. Europe +3.5%. ‘America’ (sic; not clear if this is the 23 countries in North America, or just the US) +2%.

-Holiday travel* grew +4%, business travel flat. Within business travel, MICE travel +2%, ‘traditional business travel’ -4%.

-City breaks +8%, giving it a 30% share, behind sun-and-beach (share not given), +2%. ‘Round trips’ +3%. Cruise travel +6%.

-‘Possibility of terror’ in ‘destinations like’ Israel, Turkey, Egypt, Jordan, Tunisia is ‘very high’. We do not which other destinations are ‘like’ those listed, or why these five are listed in this order.

-US, Mexico, South Africa, France have a ‘poor image’ for safety. We do not know what this means, nor how they are different to the other five.

-‘Destinations like’ Scandinavia, Switzerland, Austria, Ireland, Portugal, Australia, Canada are perceived ‘safe, where the terror threat is seen as low’. Again, we do not know which other destinations are ‘like’ those listed. Note that Scandinavia is a 3-country region (and we are surprised Finland is not included), not a destination.

IPK forecasts outbound travel +4%, ‘Asians’ +5%, ‘Europeans’ 3-4%, ‘Americans’ +3%. II do not explain on what these growths are based – estimates/forecasts for 2019? In 2018, IPK forecast +6% growth for 2019 (+8% for North and South America, +6% Asia, +5% Europe). As the figures IPK is now reporting for part of 2019 are much lower than it forecast for all-2019, the base for 2020 forecasts needs clarification.

*Notes:

-II=Germany-based IPK International (IPKI), a research company, with ITB Berlin (ITBB), the big travel trade exhibition in the city. Unfortunately, II are often casual in reporting their findings, although we believe they are precise in their research work.

-Another common fault with II reports is that they mix categorisation. Would a Singapore passport holder living in Paris be included in II’s ‘Asian’ count into Spain? And a France passport holder living in Singapore? These are common faults of non-specialists, but II is supposed to be a leader among specialists!

-For ‘holiday travel’, we believe II mean non-business travel, sometimes known as ‘leisure travel’.

-Earlier in 2019, II introduced ‘roundtrips’ as a category in some reports. There has been no further definition although the term makes no sense as presumably 99.9% of trips are roundtrips. In other reports, II have had a category ‘tour holidays’ (sometimes ‘touring’). II also never defined this, and as it was open to interpretation, we wondered how those questioned defined it.

-At press time, II had not answered our request for clarifications.

 

 

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

Travel Industry Data News, November 11-15

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Travel Industry Data News, November 11-15.

From http://www.travelbusinessanalyst.com

 

Travel business updates

15 November 2019

[] Greece’s DMO reports September air arrivals +1.3%, YTD +3.3%. Bank of Greece all arrivals August +11.0%, YTD +3.6%; spend +16.1%, YTD +13.6%.

[] STR (nee Smith Travel Research) reports hotel-rooms pipeline* at October:

-Asia Pacific 450,231 +20.7%. We calculate from our database that is -4.3% on the previous number reported by STR earlier this year.

-Europe 205,383 +44.3% (sic). +6.8%.

-US 205,299 +5.5%. -0.3%.

*Notes: A full report on this topic in our WYSK:What-You-Should-Know monthly-report contains some important additional information, qualification, and analysis.

[] OAG* reports on India:

-Domestic seat sales were +19% in 2018.

-US$8bn digital flight retailing market.

*UK-based OAG (formerly/formally Axio Aviation Holdings) provides comprehensive data on airline flights from 900 airlines and 4000 airports. Its flight-status database provides 35mn flight status updates daily, and processes 1.4mn requests. It is owned by UK-based Vitruvian Partners, a private-equity firm.

[] Research & Markets (RM), a company, reports:

Affluent customers spend 21-32% of their money on travel. No further details.

Japan targets 40mn visitors in 2020 and 60mn in 2030. That would be +4.1% AAGR (annual average growth rate). We calculate AAGR 2008-18 was much faster, +14.1%. Numerical growth would be lower – 20mn additional visitors in 2030 over 2030, compared with 23mn 2018 over 2008.

[] STR (nee Smith Travel Research) reports on US hotels 3-9 November: occupancy +0.1% to 69.0%, average room rate +1.9% to US$132.66.

[] ARC (the Airlines Reporting Corporation, handling financial settlements between US-based travel agencies and airlines), reports for October (any rounding by ARC):

-Air tickets sold US$8.3bn +1.5%. YTD US$84.4bn +2.8%.

-Average US roundtrip ticket US$506 -$3; passenger trips 25.4mn +1.5% (domestic – +2%, international +0.5%).

-EMD (electronic miscellaneous document) sales US$6.7mn +11%; EMD transactions +18%.

 

Done deals

14 November 2019

Global Data, a data and analytics company, reports on deals by companies in Europe’s travel business in Q3. Findings include:

-Deals done worth US$5.71bn +5.1% over average Oct 18-Sep 19.

-104 deals compared with average Oct 18-Sep 19 of 99 deals.

-M&A (mergers and acquisitions) accounted for 64 deals worth US$4.08bn, 61.5% share. Venture Financing 23 US$891.25mn 22.1%, Private Equity 17 US$742.83mn 16.4%.

-Top-5 deals worth US$4.52bn 79.1% share.

 

Travel business updates

13 November 2019

[] IATA (International Air Transport Association) reports for September RPKs +3.8%, ASKs +3.3%, load factor 81.9%, +0.4pt. RPKs by region – Asia Pacific +4.8%, Europe +2.6%, Middle East +2.0%, North America +5.1%.

International RPKs +3.0% – Asia Pacific +3.6%, Europe +2.9%, Middle East +1.8%, North America +4.3%.

Domestic RPKs +5.3%- Australia +1.8%, Brazil +1.7%, China +8.9%, India +1.6%, Japan +10.1%, Russia +3.2%, US +6.0%.

[] PCW (Phocuswright, a travel research company specialising in online data) reports gross bookings of publicly reported OTAs* were US$177.9bn +11% in H1; it was +21% H1 2018.

 

TBA Tracking: Indices, Travel Stocks

12 November 2019

The Baird/STR Hotel Stock Index in October for US hotel companies was 4641 +0.2% (over previous month). YTD, their stock index was +14.0%.

The worldwide ‘TBA-100 Hotel Stocks Index’ for October, from the current editions of WYSK:What-You-Should-Know, published by Travel Business Analyst, was at 183.

The worldwide ‘TBA-100 Airline Stocks Index’ for October, from the current editions of WYSK:What-You-Should-Know, published by Travel Business Analyst, was at 205.

The ‘TBA Travel Stocks Index’ for October, from the current editions of WYSK:What-You-Should-Know, published by Travel Business Analyst, shows: World 225, Asia Pacific 79, Europe 199, US 388.

The worldwide ‘Net-Value Travel-Tech Index’ for travel stocks of OTAs (+Amadeus) in October, from the current edition of our monthly Net Value report, was at 156.

The ‘China Travel Stock Index’ of China stock prices (from China companies quoted in Hong Kong and New York, as well as Shanghai), in October from the current editions of WYSK:What-You-Should-Know, published by Travel Business Analyst, was at 93.

Notes: The Baird/STR hotel index is based on 1000 at February 2000. The TBA Hotel and Airline stocks indices are based on 100 at December 2000, the ‘TBA All-Travel Index’ 100 at December 2006, the ‘Net-Value Travel-Tech Index’ 100 at December 2014, the ‘China Travel Stock Index’ 100 at December 2018. Or when first listed if later.

 

Euromonitor’s outlook

11 November 2019

Some new forecasts by Euromonitor* (EM), a UK-based market research company:

-Average spend per trip US$1101 by 2024 (could be 2023); change not given, and quoted in US$, risky at this time of sizeable currency fluctuations.

-‘Tourism demand’ (presumed ‘visitor spend’) in the US ‘could see 9.6% wiped off potential growth’ by 2024. We presume this is a possible lowering of previous forecasts, but without principal data, this forecast has little meaning.

-Forecasts that ‘Brexit uncertainty’ and a ‘severe recession’ in Europe (EM usually excludes the UK when reporting on ‘Europe’, and sometimes it includes all Europe, other times just the 27/8 members of the European Union) will make no-frills-airlines and short-term rentals the ‘most popular travel choices’.

  EM seems to be the only main forecaster expecting ‘severe’ recession for ‘Europe’. Most others forecast a recession (which generally means when two consecutive Qs where their GDP is falling) for one market, Germany, albeit slow growth in a few others.

  ‘Most-popular’ presumably means above-50%. That is already the case for NFAs on intraEurope, but unlikely for all flights, although EM does not put dates on its forecast.

  EM does not define ‘short-term rentals’ (it could mean ‘private accommodation’ such as AirBnB properties), and so this also has little meaning.

EM reports 59% of Europe’s population is ‘concerned about climate change’ to explain that ‘the move towards sustainable travel is on the rise’. That growth is no surprise (after all, it has been growing since it was identified, perhaps 20 years ago), but EM could help and forecast – 35% of leisure travellers will take trips billed as ‘sustainable’ in 2024 against 15% today?

-Middle East and Africa ‘enjoys sound growth’. EM forecasts departures will grow +5.6% by 2024. We have seen little outbound-travel data on these two areas. Similar measures from the WTO (World Tourism Organization, which it abbreviates to UNWTO) this year show Saudi Arabia -4%, UAE +2%, and nothing on Africa. This does not seem to be ‘sound growth’, which we would think means +4-5%? And that +5.6% forecast, if for 2024, would mean a +1.1% annual average growth rate; to us, that looks slow.

*Notes: We have run a few critical reports on EM findings – most apparently due to imprecision in its editorial commentary. At press time, EM had not answered our request for clarifications.

 

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

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