Yahoo Finance TUI boss optimistic that summer holiday season can be saved
The boss of travel operator TUI (TUI.L) has said that the summer holiday season can still be saved thanks to a string of successful COVID-19 vaccine programmes.
Friedrich Joussen told the BBC in an interview that the company was “confident” and “optimistic” that people could have a decent summer as rollout programmes in the UK, the US, and now across Europe gather pace.
TUI said it had received some 2.8 million holiday bookings last month alone. The company, which owns aircraft, cruise ships and a chain of travel agencies, was thrown into turbulence last year as the pandemic wreaked havoc on the industry.
Last week, the UK's biggest tour operator announced it would need to raise €350m ($416m, £304m) via a convertible bond to offset the impact of the coronavirus crisis.
The bonds are due in 2028 and the offering could be increased to €400m, the company said. They will be issued with a coupon between 4.50% and 5.00% per year and they will be convertible into new or existing TUI shares.
TUI, which sells holidays to 180 countries, has been bailed out three times by the German state since the onset of the COVID pandemic. It has received over €5bn in financial aid, so far.
However, it now expects to operate up to 75% of its normal schedule for the summer season.
“All profitability is in the quarter commencing July, so that is important,” Joussen said.
He added that he expected some countries to ask travellers for proof they had been totally vaccinated before they were allowed to cross borders, but that a negative test result would be just as effective in preventing the spread of COVID-19.
It comes as the latest UK government figures show that 32.4 million people have received their first dose of the vaccine, with 8.5 million being totally inoculated.
European countries have ramped up their vaccination programmes in recent weeks, as the continent suffers from a third wave of infections.
Last month France sent a number of regions into lockdown, while Poland announced that nurseries and preschools would close.
Elsewhere, the Finnish government submitted a proposal that would see temporary restrictions on movement in the worst-hit areas for 3 weeks, with people only able to leave their homes for essential reasons or outdoor recreation.
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According to the World Travel and Tourism Council (WTTC), income across the travel sector fell by almost $4.5tn last year, putting more than 62 million people out of work.
It is pressing for international travel to resume in June to stem further job losses.
The comments come just days after the UK government's Global Travel Taskforce (GTTF) announced a traffic light system for travel, which categorises countries based on risk as well as COVID tests, even for people arriving from low-risk green destinations.
The need for those who are vaccinated to still be expected to pay for gold standard PCR tests on their return to Britain has been called a "hammer blow" for the travel industry.
Despite the announcement, GTTF did not confirm whether foreign holidays will be permitted from 17 May, but it did suggest that it could still resume "in an accessible and affordable way."
May was the earliest month when international travel was expected to resume under prime minister Boris Johnson's roadmap out of lockdown.
Transport secretary Grant Shapps has said that the UK will work with the travel sector and private COVID testing providers to reduce the cost of foreign trips.
But Shapps voiced "concerns" over the costs of the tests, adding that the government was committed to driving down the price of these by working with the private sector.
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