The Arab spring effects leisure carriers' bottom line

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Turmoil in the Middle East and North Africa has significantly impacted leisure carriers such as Thomas Cook and TUI and caused them to shift planes and capacity away from destinations such as Egypt, Morocco and Tunisia.

Thomas Cook cited the disruption in programmes to Egypt and Tunisia as being the main cause for an increase in group first-half seasonal underlying losses from operations of £36 million to £166 million on the previous year.

Meanwhile, TUI reports that events in North Africa were continuing to impact significantly on trading even in August, especially on its French business.

TUI chief executive Peter Long says that in France, holidaymakers who would normally have taken their vacation in North Africa, have instead chosen to holiday within their own country.

However, Sylviane Lust director general of the International Air Carrier Association says there is no reduction in capacity for her members. "It's not as though suddenly the airlines are staying on the ground. Passengers are still going on holiday, simply the destinations have shifted." She reveals that holiday hotspots such Greece, Turkey and Spain have been the main beneficiaries of the capacity switch.

While cost-conscious holidaymakers are returning to places that offer economy and familiarity, the Arab Spring has not led to an upsurge in traffic to more exotic destinations, according to Paul Dickinson, sales and marketing director for long-haul giant Virgin Atlantic.

He says Virgin Atlantic, which offers leisure services to destinations such as the Caribbean and the USA, have not benefitted from the turmoil. "The markets you might assume would have benefitted from some of these people moving away from the Middle East and North Africa haven't done so. He confirms that instead holidaymakers have chosen near-European traditional sun destinations or taken domestic holidays.