According to research from OC&C Strategy Consultants, European travel and tourism are nearing pre-pandemic levels, with travellers showing a willingness to spend more despite increased expenses for air travel and accommodation.
The Covid-19 pandemic dealt a severe blow to the global economy, particularly affecting the travel and tourism industry. However, after four years of gradual recovery, the industry is finally seeing positive signs of revival, with projections suggesting that most European markets will surpass pre-pandemic levels by 2025.
Despite the higher costs associated with travel, travellers are eager to explore again as the pandemic recedes into memory. While airfare in the Eurozone has increased by 38% since 2019 and hotel prices have risen by 26%, travellers are still keen to invest in travel experiences, including tour packages, although low-cost options remain popular among younger travellers.
Several factors have contributed to the rise in travel costs, including inflation, higher demand, and operational challenges such as staff shortages. Additionally, measures taken by airlines to promote sustainability, such as the use of green fuels, have led to increased costs for consumers.
Source: Eurostat
Although sustainability issues influence the travel decisions of the majority of European travellers, only a small percentage are willing to pay more for travel experiences aligned with environmental, social, and governance (ESG) values. However, consumers are becoming increasingly sceptical of greenwashing practices, emphasizing the need for genuine ESG initiatives in the travel industry.
Despite these challenges, the recovery in European tourism is evident across various countries. Destinations such as Portugal, Montenegro, Turkey, and Malta have seen significant increases in tourist arrivals, with all-inclusive holiday options and affordable travel costs attracting price-conscious travellers. In contrast, Eastern European destinations like Lithuania, Latvia, Estonia, and Finland have experienced a slower rebound, highlighting regional variations in recovery rates.