UK travellers to spend 9% more on domestic holidays due to airport delays, rising prices and Covid fears

Amid the airport queues, Covid stress and ever-growing cost of living, many will be reconsidering holiday plans this summer. It may be that a dash for the seaside or a secluded caravan becomes that much more attractive than a trip overseas.

It is predicted British holidaymakers will spend billions more on trips within the UK, i can reveal, even as the wider travel market lags behind its pre-pandemic strength.

Domestic holiday spending will reach £15.7bn in 2022, a 9 per cent increase on the amount spent in 2019, according to Mintel data exclusively shared with i.

While British tourists are expected to spend a total of £54bn on overseas and domestic travel this year – a 157 per cent increase on the £21bn spent in the pandemic-hit 2021 – this figure is still 7 per cent short of its pre-Covid levels. Spending on overseas travel will lag 12 per cent short of 2019 levels, Mintel predicts, coming in at £38.2bn for 2022.

As scenes of spiralling queues or lost baggage at UK airports play out this summer, Mintel found that 72 per cent of those polled cited airport chaos as putting them off flying until the situation is resolved. Instead, 81 per cent of those who usually holiday abroad say they are likely to travel domestically in the next two years.

Covid still weighs heavily on travellers’ minds: 30 per cent of holidaymakers remain worried about virus-related disruption to their trip, whether by travel regulations changing while they are away or discovering they do not meet entry requirements.

The cost of living crisis is also a key barrier, says Paul Davies, director for travel at Mintel. Inflation not only means the cost of plane, train and boat tickets is significantly higher, but equally local travelling costs or car hire.

“The rising cost of living will force holidaymakers to prioritise expenditure carefully, just as they did during the last income squeeze,” he explains. “Short overseas trips and city breaks will take longer to recover as Brits prioritise their main holiday, whilst lower-cost staycations and camping breaks will perform strongly.”

Mr Davies says that even as prices rise, people are unlikely to change their plans significantly if they were already in place, but would be likely to reconsider in future, pushing these trends into 2023 and beyond.

Another knock-on effect is would-be foreign travellers are putting off on booking their holidays until later than normal, says Danni Hewson, AJ Bell financial analyst.

“The chaos witnessed at airports over the Easter holiday adds another layer of nerves,” she explains. “No one wants to be stuck for hours with tired and emotional children and tales of people getting stuck in resorts and having to pay extra cash to get themselves home put even more families off a summer holiday in the sun.

“Better to wait until the initial restart troubles are smoothed out and the threat of industrial action, both home and abroad, isn’t hanging over the industry like a storm cloud.”

Allegra Dawes, at global primary research firm Third Bridge, says many of these issues are a function of a “strong surge in demand” for flights and holidays and the difficulty in ramping up capacity to meet it.

“In the short term, consumers still have a pretty good level of savings,” she explains. “There’s a lot of pent-up demand remaining from the pandemic, and I think a lot of people are taking the opportunity to travel, despite the challenges.”

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Ms Dawes says the Mintel figures point to a longer-term trend that may become cemented by 2024 or 2025. “You might see passengers and travellers in general start to look for domestic options, cheaper options, and less risky in terms of potential disruption,” she adds.

The UK tourist experience has “come on leaps and bounds since the 70s and 80s”, she explains, with growing numbers of luxury and mid-level options emerging in glamping sites, countryside spas or boutique city stays.

The airline sector may be in for a torrid time as a result. Ryanair’s chief financial officer Neil Sorahan has already warned that “the days of €9.99 (£8.40) fares are probably coming to an end”, with costs and looming strikes likely to eat into the budget airline’s bottom line.

The scene is set for a competitive drive between different operators, says Ms Dawes, with the differences between different airlines set to become starker as pressure grows. . There could be more bidding for rival airlines, much like Wizz Air’s recent approach for easyJet, while fleets could be allocated different with orders of new planes focusing on “very efficient, cost-effective air travel” in narrow-bodied craft, she suggests.

Whatever the impact of this summer’s turmoil, it’s likely our summer holidays could look very different next year.

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