SCOTTSDALE, Ariz.
-- Much talk focused on possible mergers and acquisitions in the
coming year at the U.S. Tour Operators Association's Annual
Conference & Marketplace.
With the weakness
of the dollar against the euro and pound sterling giving a
substantial boost to the buying power of those using those
currencies, some tour operators said major European companies were
poised to make significant inroads into the U.S. market.
USTOA President Bob
Whitley acknowledged that companies in Europe and the U.K. are
indeed scouting the U.S. market but noted that this isn't something
new.
"First Choice has
already been buying American operators. It now has 18 companies,"
he said.
Whitley said there
were a number of operators that might be ready to make
deals.
"There are some
entrepreneurs who are getting to the age where they'd like to
retire," he said.
Tour operators at
the conference said they expected Germany's TUI, the U.K.'s
MyTravel and Canada's Air Transat to follow in the footsteps of
First Choice.
Whitley made a
distinction between the kinds of acquisitions that are on the
horizon and some that rocked the industry in recent
years.
"I think we are
over the venture-capitalist phase," he said. "It was a disaster to
our industry. That was when investors and bankers were trying to
get into the tour operator industry. Now what's happening is that
professional travel companies are trying to expand. That's OK.
That's not the banking industry trying to get into things they
don't understand."
Whitley cited three
examples of consolidations by investment groups that collapsed:
Global Vacation Group, Vista Travel Ventures (more frequently
referred to as Kingdom Vacations) and the Far & Wide Travel
Corp.
USTOA Chairman
Nikos Tsakanikas said, "Today's consolidations are different. They
are companies with experience in the travel industry."
Other trends
generated buzz at the conference, too:
"
The growth of river cruising has been so meteoric that some
questioned how long the most popular rivers could sustain the
current growth rate. Most said that growth of the industry would
have to level off.
"
Beyond the rivers, sustainability in general is an issue of
increasing importance to operators. The USTOA responded by creating
the Responsible Tourism Committee in 2006. Harry Dalgaard, Rail
Europe Group's executive vice president of marketing, heads the
committee.
"Our first priority
will be to educate members, to bring up the level of awareness,"
Dalgaard said. "Then we'll develop a way
to certify it and formulate a strategy to bring members up to
global speed on issues of responsible tourism."
To
contact reporter David Cogswell, send e-mail to [email protected].