herald

Monday 18 December 2017

How bureaucrats abroad now decide where you holiday

Now Falcon Travel cuts its Irish operation, writes, Eoghan Corry

Changing times in the travel business in Ireland. Three months ago the country's leading holiday brand disappeared. Now Falcon Holidays are to downgrade their Irish operation to a marketing operation, and the MD and two fellow directors are moving on.

Damien Mooney, managing director since 1997 and until recently president of the Irish Tour Operators Federation, is to depart along with two senior management colleagues, Don Shearer, sales and distribution director, and Sean Ryan, the finance director.

It means that Falcon are no longer going to have back-of-house operation in Ireland, transferring those operations instead to the German conglomerate TUI, which has owned the company since 2008.

Christine Donnelly, based in Belfast, is the new head of Ireland, while marketing manager Charlotte Brenner heads up the Dublin operation.

That Falcon have reduced their Irish headquarters to a service role is a measure of how things have changed in the business. Irish people bought 1.1m holiday packages in 2001. This year they will buy fewer than 400,000.

The decline has been enough to send alarms through the business among those tour operators who have survived after the failure of big name brands, such as Budget Travel, Slattery/Stein and XL Holidays.

Since the demise of Budget Travel, Falcon has commanded a 35pc share of the package holiday business in Ireland, with about 28pc operated by Falcon and about 7pc of that operated by the JWT brand, purchased from the Walsh family after the death of industry father figure Joe Walsh in 1995.

They have gained about ten points in market share into key Budget Travel properties, such as the Sonamar in Majorca, and destinations such as Corfu. But the freefall in the holiday business has meant that costs have had to be further pared back.

Falcon has also closed 12 of its 24 shops, a side of the business that had been successfully developed in the good times.

Mr Mooney commented recently that he had been astonished by the loss of consumer confidence in Ireland in the post-September 2008 period, with people postponing their holidays and, equally uncomfortable for the holiday companies, the holiday decision. In all, 40pc of the business disappeared last year, and some operators cut capacity too late to save themselves.

"Ireland will remain a separate market. The Falcon brand is strong here, there are unique holidaymakers and a family core sector which is different from other countries. But the changes within the travel industry in Ireland have resulted in many companies having to realign their businesses to reflect the market conditions."

Falcon followed Budget Travel in moving their business away form travel agents, reducing commission to 5pc and offering a 5pc incentive to customers to book online. The closure of 12 shops has meant that the company has looked back to franchise agreements with independent agents to keep its share of the Irish market.

What does it mean for the consumer? Not a lot. The Falcon and JWT brochures will still be printed and distributed. There will still be Falcon reps looking after Irish holiday makers at the sun resort where they travel.

The company say this "a realignment". But Falcon Holidays' separate Irish identity has been dissipated, if not eradicated altogether.

There have also been recent moves to integrate two other Irish brands, Panorama and Sunworld into a competing English parent, Thomas Cook.

Contrary to what most of us believe, we don't decide where to go on holiday. The decision is made for us by the tour operators who runs flights to certain destinations and put them on sale at affordable prices.

Those decisions are increasingly being made outside of Dublin and outside of Ireland.

It is a worrying trend.

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