Faced with end-of-year financial results and passenger volume data that are expected to be flat and losing market share midst an overall market environment that is sluggish due to a weakened euro, TUI Germany, under its new CEO, Sebastian Ebel, is expanding the company’s hotel capacity and cutting some prices as it strives to recapture share in the German market. Ebel aims to increase share to 25 percent by 2020, which would be a 48 percent increase from its16.0 percent share (see table below).

TUI has added 3,500 new hotels for summer 2016 both in short/medium-haul and long-haul destinations—which means 1,700 more hotels in overseas destinations, which is 20 increase over the summer of 2015.

TUI’s prices will drop by about 2-3 percent on average; this figure includes early booking discounts. Ebel said the reduction resulted from “flight over-capacity” and lower jet fuel costs. Still, some long-haul destinations will be more expensive due to the strong the U.S. dollar vs. the weak euro. In a statement, the company said that most destinations are selling well with the exception of Tunisia where bookings have slumped. Premium brand Airtours has a double-digit rise in winter bookings after “good growth” in 2014/15.

Top Tour Operators in Germany

Also, from Germany: A Berlin-based meta-search engine for holiday homes, Hometogo, has entered the U.S. holiday market and is launching a nationwide advertising and marketing campaign to raise awareness. The hometogo websites enable users to find and compare offers but then redirects them to the provider’s website for bookings. The company, which is already active in various European markets, claims to cover about 3.1 million offers for holiday homes, including about a halif-million units in the USA where the offering will be expanded

Germany’s largest and third-largest tour operators—Tui and DER Touristik, respectively—are proceeding apace with their previously announced plans to unify a brand (Tui) and to restructure following a major acquisition (DER Touristik).

In the first phase of the Tui’s international rebrand, the company announced that the Dutch travel operation Arke, had changed its name to Tui. Already well-known in Germany, where it is the largest tour operator, the Tui name will gradually replace the large tour operator brands, continuing with France in 2015, followed by Belgium, the Nordics and the UK in the next two years.

“Creating an internationally unified branding will enable us to offer our customers a consistent holiday experience,” said Erik Friemut, a member of the Tui Group’s executive committee, adding “A unified global brand will also significantly enhance our competitiveness in the important online segment and help us modernize our brand. Our Dutch colleagues have implemented the rebranding campaign within a very short period of time, and we are very proud of what they have achieved. They will now be the blueprint for the other European markets.”

DER Touristik, meanwhile, is organizing as a holding company with an international management board, and is divided into three regions covering 14 European countries, and with three central units. This follows the recent acquisition of Kuoni tour operator businesses in Europe. Schematically the new organization looks like this:

DER Touristik’s Three Regions

At the three units, Michael Kimmer is CEO, destination management and hotels, with responsibility for expanding the worldwide destination activities. Chief transformation officer Dirk Tietz will head IT and corporate development, while a chief financial officer for the group remains to be appointed.

CEO Sören Hartmann, who will run the overall group, said the DER Touristik Group would be “lean” and would “act fast” and emphasized that the companies in the local markets would remain independent and be led by their existing management team.

It’s not all about the strong dollar vs. the weak euro. The latest monthly report from GfK, the Nuernberg-based research organization that surveys 1,200 travel agencies in Germany on a regular basis, contained some more news on business activity that, while not discouraging, is not encouraging, either. Worse, when one steps back to put the current, sluggish news, in a broader context, the outlook for any meaningful growth in the number of visitors from Germany to the U.S. is gray for as far as the statistical horizon stretches: In its most recent long-term forecast (through 2020), the U.S. National Travel and Tourism Office (NTTO) projects that inbound traffic from German will remain at about the same in 2015 as it was in 2014. And then it won’t increase more than 2 percent in any year between now and 2020.

But beyond that, there are factors—not the kind that NTTO configures into its forecast—suggesting that the long term outlook is even less encouraging: Specifically, Germany is already the oldest country in Europe and has little chance of becoming younger in the near term, as it now has the lowest birth rate of any major nation in the world. That means fewer workers to replace the German workers now in their prime who will grow older, and then fewer people to replace those now in the prime travel-age demographic who will grow out of it.

First, the latest snapshot: The latest news is that overall sales revenues for German travel agents declined by 3.1 percent in August, following an overall decline of one percent in July.  Also, there was no last-minute “sales boom” this year as there was in 2014. Revenues from late sales of summer holidays fell by as much as 8.3 percent last month, said GfK.

Second, the long view: Information that has been released from different sources over the past year, when taken as a whole, comprises the long-term bad news. A study published by the German auditing firm BDO with the Hamburg Institute of International Economics (HWWI) says Germany’s birth rate has slumped to the lowest in the world. It has dropped below Japan to have not just the lowest birth rate across Europe but also globally, according to the report. In Germany, an average of 8.2 children were born per 1,000 inhabitants over the past five years, according to the study. It said Japan saw 8.4 children born per 1,000 inhabitants over the same time period.

Right now, the median age—half the population of this nation of 81 million people is older than the median and half is younger—is 46. Of all the nations in the world, only Monaco (population, 36,371 in 2011) has a higher median age (51). Here’s how the German population breaks out into age categories.

Breakdown of Population of Germany, USA, by Age Group

2005-2020

(000s)

Source: U.S. Department of Commerce, International Trade Administration, National Travel and Tourism Office

ᶠ Forecast