South Tenerife is one of those lucky places to be blessed with all year round sunshine, very little rain and very pleasant temperatures.  Now wonder over one and a half million Britons visited the island last year.  However are we going to see a decrease in British visitor numbers in 2008?  Why?  I think a variety of factors are going to combine to make for a downturn.  

Firstly, due to the credit crunch, cash has become tighter as interest rates have been pushed up reducing cash for luxuries such as a second holiday, quite a few visits to the island are just for one week as a second holiday in the winter months, I can see these type of holidays to be the first go for cash strapped families.

The record price of oil is now working its way through the system.  Many airlines buy their with prices fixed in advance. This allows them to control their short term costs, at $70 dollars a barrel this allows them to keep their prices keen, but at $95 a barrel this has to be passed on to the consumer.  Last year in May I could get return flights for around £170, this year they are around £250.  However, fuel costs are not just the only factor, competition is another.

Last year, Monarch and British Airways had daily flights to the island, with Jet2.com and Ryan air joining the fray with the charter flights filling in.  However, things have changed.  Competition has reduced.  BA sold their franchise operation GB Airways to Easyjet last year.  The operation passes over at the end of March.  BA’s prices were competitive without the no frills cattle truck approach.  I have doubts that Easyjet will continue the daily flight schedule in the long term.  They prefer short haul times of no longer than 2 hours one way so they can get around 4 return flights a day.  With Tenerife being 4 hours one way this model comes into question.  Add the fact that their seat pitches are 29 inch as opposed to BA’s 31 inch, are passengers going to put up with 4 hours of those seats?  Some how I doubt it.  I think Easyjet will pull out leaving Monarch again with only daily carrier from the UK.  This will give them the opportunity to increase their margins and hence prices.  

What effect is all this going to lead to?  Yes numbers will go down as prices go up.  But we will see an increase in the more senior traveller, who will be taking 4 week visits to avoid the worst of the British winter if they can get a good bargain.  There is plenty of good cheap self catering apartments and villas in areas such as Golf Del Sur, that is not an area which attracts the lager louts and their girlfriends, and has good facilities for the more mature visitor.  Areas such Playa Las Americas are more likely to see numbers drop in the winter months as this is a more youth orientated resort and has more hotels, which are more expensive.  However, we will see what happens.

John is a regular visitor to Tenerife and has a holiday web site – www.tenerife-holidays.biz