Europe’s giant TUI keen to resume charter flights, upbeat on post-war tourism

Thursday, 16 January 2014 00:00 -     - {{hitsCtrl.values.hits}}

By Shabiya Ali Ahlam TUI, one of the world’s leading travel companies this week declared that post-war Sri Lanka has great potential, encouraging the UK-headquartered giant to explore prospects of reintroducing a charter flight with 300 tourists per week. This optimism was shared by TUI Chief Executive Officer Peter Long who led a top level team to Sri Lanka on an exploratory visit. TUI used to operate a charter flight back in mid-2010 but suspended it due to waning demand in Sri Lanka from a recessionary Europe. However with the uptake in Sri Lanka’s attractiveness as a tourist destination post-war, a strong pipeline of large scale resorts, improved outlook in outbound travel from Europe and new and bigger aircraft for its operations, are among reasons why TUI is exploring prospects for the resumption in charter flights. TUI is one of the world’s leading leisure travel groups operating in over 180 countries with more than 30 million customers in 31 key source markets. “We are asking ourselves about the possibility of resuming charter flights. That is why we are here to help us understand the opportunities available. We certainly believe that there is great potential in Sri Lanka,” Long told journalists in Colombo on Tuesday. He said charter flights operated previously via First Choice saw weekly arrival of 250 tourists in to Sri Lanka. Due to the lack of scalability, the company stopped its charter flights in April 2010. However, it continued to bring in tourists through scheduled flights though numbers had dwindled. The idea of recommencing charter flights to Sri Lanka has surfaced following the TUI Group’s resort brand RIU partnering with Aitken Spence (which also represents TUI in Sri Lanka) and announcing that the Spanish hotel chain would manage its newest 500-room facility, which will be constructed on an 11-hectare site in Ahungalla. “I think this (entry of RIU) will bring about significant opportunities for us because we have strong relations with RIU across all destinations. We need scale and if we are to operate our flights here, we need bigger numbers and we want to work with larger hotels to make sure there is sufficient accommodation available. Therefore, the RIU project is very important and exciting for us. My feeling today is that there are exciting opportunities here and we want to convert this opportunity into a detailed plan,” Long pointed out. A hitherto lack of large hotels was cited as a deterrent to bring in tourists in big numbers. “We are not saying that the country should be spoilt by a concrete jungle. It should be done in an environmentally friendly manner,” added Long for whom it his first visit to Sri Lanka. While increasing room capacity is an area that needs focus on, Long added that continuous infrastructure in order to facilitate tourism is imperative. Furthermore, he stressed on the need to market the country as a tourist destination since travellers from many regions, including Europe, are unaware of the experiences Sri Lanka has to offer. In this endeavour, TUI shared that it is willing to support the Sri Lankan tourism authority to help promote the country in the 31 source markets in which it is well established around the world. TUI was named World’s Leading Tour Operator at the World Travel Awards in November last year. When questioned on his views on the competitiveness of Sri Lanka, as there is an ongoing debate that its accommodation is overpriced, Long said: “I think what will help is the economics of operating bigger hotels and that will bring more attractive prices. The economics of a 50-room hotel is different to that of a 500-room one. And clearly, every country has to be mindful of the fact that whether the competition is nearby or 1,000 miles away, it is there. For that, you have to be competitive by having large scale operations that would bring about the economies of scale to accommodate capacity. “I don’t think Sri Lanka will lose its competitiveness or that it would be disadvantaged in terms of cost if it operated on such a scale. Our business is about that. With our large scale operations, we are able to fill up larger hotels and that in turn serves the region and brings about bigger returns for hoteliers and tour operators, and most importantly, a value for money holiday for our customer. However, there is an urgent need to invest in long term sustainable tourism,” emphasised Long. In the financial year ending September 2013, TUI became the first business in the UK to take delivery of the Boeing 787 Dreamliner. This has enabled it to fly direct to new and exciting destinations such as Thailand from the UK. In May last year TUI committed to purchasing 60 new Boeing 737 MAX aircraft and secured the option and right to purchase another 90 on the same terms. The deal was to enhance TUI’s unique offering, replace older aircraft, improve fuel efficiency and help secure the future of six airlines. The delivery of the 60 committed aircraft will run from January 2018 until March 2023. In November TUI completed an order for two additional Boeing 787-8 Dreamliner aircraft from Boeing. The additional order takes the group’s commitment from 13 to 15 Dreamliners, with the additional two aircraft expected to arrive in 2016. TUI Travel operates six airlines, four of which operate, or will operate, Dreamliner aircraft: Thomson Airways, Arkefly, TUI Fly Nordic and Jetairfly.