Global tourism is returning to pre-pandemic levels, but the industry is encountering new challenges. Travelers are increasingly organizing their trips independently, and climate change is affecting the popularity of destinations, writes Pawel Majtkowski, an eToro analyst. At the same time, rising prices and concerns about an economic slowdown cast a shadow over the future of market leaders like Airbnb and TUI.
The upcoming long August weekend due to St. Mary’s holiday (plus Friday, an extra day off offered by the government) is a period of increased travel for Romanians. Black Sea resorts in particular are hoping to benefit from the surge as 140,000 tourists are expected to spend the four-day holiday in the Romanian resorts. This is also the last mini-vacation that Romanians will have until Christmas.
According to data from the World Tourism Organization, global tourism in 2023 was 11% lower than in 2019, but by the end of the first quarter of this year, the difference had narrowed to just 3%.
Although statistics are returning to previous levels, the tourism business has undergone a radical transformation. Travelers are increasingly acting as their own travel agents, planning and booking trips independently. The range of available travel options is expanding, and prices are becoming more transparent and easier to compare. At the same time, tourism is becoming more dependent on weather conditions, linked to climate change—as evidenced by the recent wildfires in Greece. New trends, such as “Coolcations” (vacations in cooler regions like Scandinavia to escape the summer heat), are gaining popularity. According to data from booking platforms like Airbnb, the time between booking and stay is shortening, indicating that tourists are planning their trips later, especially for longer vacations.
Europe remains the most popular travel destination globally, with forecasts suggesting that tourists will spend a record €800 billion on the continent this year—37% more than before the pandemic, despite the number of tourists being only 6% higher than in 2019. This is due to significant price increases driven by inflation and rising demand. The main driver of tourism growth in Europe continues to be tourists from the USA. Although countries like Poland are gaining popularity, 72% of tourism spending in Europe is concentrated in the western part of the continent. On the other hand, in many places in Europe, the number of tourists is already too high, prompting the search for new attractive destinations.
Globally, the tourism industry is experiencing mixed feelings due to the risk of a global economic slowdown. Last week, Airbnb’s shares fell by 14% after the company announced second-quarter financial results that were below market expectations. The company’s revenues grew by 11% year-on-year, but net profit decreased by 15% compared to the same period last year. With over 8 million listings on its platform, AirBnB removed 200,000 that did not meet new quality standards. The company warns of a possible slowdown in demand in the U.S. and increasingly late vacation planning, which could also negatively impact future revenues.
Traditional tourism companies like Germany’s TUI also face challenges. Since its peak in 1999, TUI’s shares have lost 97% of their value and significantly lag behind the broader market (a 22% drop in 2024, despite a nearly 5% increase in the past week). Currently, the share price is only 20% higher than its record low. This week, the company reported its quarterly results—revenues reached a record €5.8 billion, 9% higher than a year earlier. The company reduced its debt by over €42 million, but it remains €2.1 billion in debt. Bookings for this summer increased by 6% compared to last year, and the average selling price of services is 3% higher than a year ago. TUI plans for revenues to grow by 10% throughout 2024.
Romania to promote itself as hot tourism destination on German taxis at EURO 2024
