PriceWaterhouseCoopers Warns of Problems in the Travel Industry

According to reports, PriceWaterhouseCooppers is claiming that the demise of Budget Travel could be the start of a wave of insolvencies across the travel sector. Travel experts agree that the fall of one of Ireland’s biggest tour operators could be bad news.

According to reports, for the first three quarters of this year, the rate of travel insolvencies was 13 percent higher than for the same period in the previous year. The director at PriceWaterhouseCoopers, Ian Oakley Smith, says that, despite an increase in failures this year, the travel sector has experienced a relatively low rate of insolvency when compared to other hospitality and leisure sectors.

However, Smith went on to say that this is now starting to change as some of the biggest names, like Budget Travel, are starting to finally go under thanks to the recession. Although the weak pound and domestic holidaymakers have benefited many travel companies, there are a lot of lenders that do not wish to lend out anymore money.

The PriceWaterhouseCoopers director went on to say that ski slopes will be desolate this season as early summer bookings suggest. This will inevitably lead to a ticking time bomb for the travel industry. With just the collapse of Budget Travel, people saw 172 jobs lost, 17 agencies closed, and 750 people stranded abroad. Another 380 people were due to fly out on holidays with Budget Travel recently, but will no longer be able to do so.

Of course, this is not the only time that the fall of a company has left people stranded abroad this year. Although the industry is trying to improve, experts claim that this is something that we are going to see more of before things get better.