This report looks at outbound travel from the Republic of Ireland (RoI) only and does not include Northern Ireland. Within this report, ‘Ireland’ means the RoI and ‘the Irish’ refers to those living within the RoI – any reference to Northern Ireland or the Irish population in general is specified as such.
The RoI’s outbound travel market, like many others, has been adversely affected by the global financial crisis that began in late 2008 and is still ongoing. Outbound volume had peaked at 8 million arrivals in 2008 but the numbers going overseas contracted by 9.3% in 2009, as more Irish decided to swap their overseas break for a domestic one. In general, the Irish have become less willing to spend on holidays, either at home and overseas, as their economy continues to falter. Between 2008-09, average expenditure for outbound trips slipped by 6.8% to €973; job security fears are curbing desire for multiple overseas breaks.
Irish consumers in general are keen on securing value for money when it comes to purchasing discretionary items such as holidays. Holidays abroad are now being perceived as more costly, but this does not mean that Irish holidaymakers are abandoning plans to head overseas altogether. Many Irish consumers have conceded that they cannot afford to take an overseas holiday during the recession but Mintel research shows that many Irish consumers still have aspirations to take a holiday. So frequency and expenditure might fall, but not desire. Instead, they are inclined to hunt and examine deals more closely before making a final decision. An expected cold snap anticipated for winter 2010 should also push some Irish abroad to sunnier climes during the upcoming winter season.
In terms of destinations, close to 85% of all trips out of the RoI are within Europe, most significantly to Great Britain, Spain, France, the US, Italy, Portugal, Northern Ireland, Germany, Austria and the Netherlands. In the recent past, the proportion of trips outside of Europe was growing, albeit from a small base. This has since reversed, as the significant depreciation of the Euro since the second half of 2008 has made it more attractive for RoI residents to holiday at home or within the Eurozone.
Trade sources have also revealed that owing to the recession, the Irish are looking for more economical alternatives to their city or beach breaks. Camping holidays are on the rise, as they are often a good budget option due to their self-catering nature, especially for cash-strapped families. All-inclusive packages are also expected to grow in popularity, simply because they limit opportunities to overspend on food, drink and activities.
The typical Irish traveller tends to plan and book their holiday online, with traditional travel agents relegated to the sidelines when it comes to booking a trip. In 2009, according to the Central Statistics Office of Ireland (CSO), 72.6% of Irish trips abroad were booked on the Internet versus just 13.7% at travel agents. Notably, the 50+ age segment are the most prolific travellers out of the RoI, with the 20-49 age group being the next most important segment. Generally, older Irish tourists have more time and money to spend when abroad, with their younger counterparts spending less overall due to greater financial commitments. Currently, some six out of ten trips from Ireland are for the primary purpose of holidays. Interestingly, the proportion going abroad to visit friends and relatives (VFR) increased significantly between 2008-09, suggesting that more Irish were staying with their friends and relatives instead of paid accommodation to keep costs down while on holiday. The number of Irish heading overseas looking for work has also increased, due to the recessionary conditions back home. April to September is the peak travelling period for Irish tourists.
For the Irish, as for many, travelling is all about escaping the grind of daily life, giving them an opportunity to unwind from their worries or stress in the workplace. This need to escape should help sustain demand for short breaks out of Ireland, especially since there is an increasing uncertainty over the Irish economy and its population’s personal financial prospects.
Air travel is the mode of transport most adopted by those from the RoI but in recent years, travelling over land and by sea has been gaining in popularity. With the uncertainty created by the ash cloud still hovering over Europe owing to the continual eruption of the Eyjafjallajökull volcano in Iceland anticipated for the rest of the year, alternatives to air travel are expected to see a rise in popularity. Irish airlines had a difficult time in 2009 as overseas travel demand fell. The national carrier, Aer Lingus, is not expected to recover until at least 2011. Ryanair, Ireland’s main low-cost carrier (LCC), however, reported a profit in the 12 months to March 2010 despite difficult trading conditions.
The travel trade in Ireland has suffered tremendously from the economic upheaval in 2009. Its biggest independent tour operator, Budget Travel, went into liquidation last year. The sector contracted by 40% in 2009, with a further decline of between 10-15% anticipated in 2010.
Looking ahead, the Irish economy is projected to grow by an anaemic 1% in 2010 due to increased exports to the country’s primary trading partners. This is not guaranteed, however, as the country continues to be battered by high employment, especially among its youth. Demand for outbound travel could see a small increase in 2010 but this will probably not make up for the 10% loss in total demand that occurred over 2008-09.
