Good German sales despite strong dollar

German tour operators have generally good bookings for the USA this year despite the strong dollar and are aiming to keep prices stable for 2017.

June 29, 2016
New Orleans’ French Quarter remains a top draw.
Photo: New Orleans CVB

The dollar is having a noticeable effect on incoming travel to the USA this year, according to participants at the recent IPW trade fair in New Orleans which attracted some 6,000 trade visitors from 73 countries. “We're feeling the headwinds,” admitted Chris Thompson, head of Brand USA. But instead of responding with price cuts, the marketing organisation is promoting better value for money, for example by highlighting options to combine major destinations with lesser-known regions.

German tour operators are taking a similar approach after a surprisingly good year for US bookings. TUI and FTI have a single-digit rise in US sales, in revenue terms, while specialists such as Canusa and America Unlimited have double-digit growth, mostly due to higher prices. In contrast, Thomas Cook admits “somewhat muted demand” and Dertour, after a record 2015, has lower sales as a result of double-digit price increases.

To stimulate demand, tour operators are trying to offer more value for money, such as with hotel upgrades, as well as with dynamic pricing using renegotiated rates. Demand for advance bookings of excursions and restaurants is also good, according to TUI, as they enable good budget planning.

Tour operators have also stepped up their marketing for US destinations and offers. “We've put a lot of the budget into marketing together with the very active destination partners,” commented Canusa. America Unlimited is also focusing on millennials.

There are also big price differences across the USA. New York, for example, is now cheaper than any time in the last five years thanks to low flight prices and thousands of new hotel rooms, according to FTI. Dertour pointed to an end to extreme price increases in Miami and San Francisco.

Overall, the winter season was good for US sales on the German market and last year's record number of 2.1 million German visitors could be achieved again this year, experts believe.

Looking ahead, German tour operators are hopeful they can keep prices generally stable for 2017 after negotiating rates with suppliers at IPW. “People have got used to the price level,” FTI believes.

Meanwhile, this year's IPW host New Orleans will benefit next year from new twice-weekly direct flights from Germany by Condor, which sees “great potential” in the destination. The Louis Armstrong International Airport, which welcomed a record 10.7 million passengers last year, has been expanded with a new passenger terminal ready for higher numbers.

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