How Has Exchange Rate Affected the Holiday Industry?
Now that the worst of the credit crunch is over, the holiday industry has been making a recovery. However, quite clearly, the industry has been affected and it would be foolish to think otherwise despite the stated opinions of some supposedly in the know. The exchange rate has caused problems for all sectors of the airline industry and they're not completely out of the dark just yet.
Many world regions were affected profit-wise, some by making a loss and others by only making a fraction of what they would otherwise make. The hotel industry was affected also, indicated by the deals they were forced to make to entice holidaymakers not to forfeit their travels.
The airline industry were perhaps affected even more with fuel prices changing all of the time. The exchange rates were affected also with the global economy being an overall victim in this. The market was already turbulent but this sunk it into al all-time low. We began to see mergers between major companies being forced to make such moves in light of the economic situation within the industry meaning that the credit crunch will have made a lasting mark upon the industry no matter how well it recovers.
The exchange rate in the UK affected British travellers more than most. They were already forced to hold on to their wallets. A summer holiday to a Brit, taking into account the climate in Britain, is often the one thing they choose not to do without even in a time of crisis. What it meant was that they chose to travel with budget airlines and as a result, these airlines began to do better as their expenses were low and they weren't left as open as some of their more high-flying competitors.
Flag carriers also paid the price. Major airlines such as British Airways lost a lot of money during this time and were forced to cut their costs to stay in line with the likes of easyJet.
Article Source: FxTradingStock.com
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Travel to Mallorca all inclusive. Book your holiday here.
by: Timothy Owen
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Date: Fri, 29 Apr 2011
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