Prices are soaring, but we are not. Why winter tours to resorts are so expensive

Julia Suntsova

In the first month of the new year 2023 – another heavy jump: +20% - 40% by December 2022 for a holiday on the Red Sea.

The main visible reason is the reduction of flights. Flight programs are disappearing and prices for tours have been rising continuously since the summer. 

The flow of those wishing to fly is gaining, the tour operator is ready to charter a ship, but there is simply nothing to fly to the resorts. Lessors have banned Russian airlines from taking planes into the sky.

In January, the flight program of iFly Airlines to Hurghada and Sharm el-Sheikh was removed (it was carried out in partnership with TEZ TOUR). At the end of last 2022, Nordwind flights were canceled. The tour operator Pegas Touristik, of course, transplanted its customers to alternative Southwind Airlines, but the volume of transportation still decreased, - explain the participants of the tg channel for travel industry specialists "Roof of the B2B Tourist House".

"The average check when booking a tour to the Red Sea resorts with arrival in the second half of January amounted to 93.4 thousand rubles, which is 20.7% higher than in the first half of the previous month." In "Fly.ru" record an even greater rise in price - by 40%", - the Travelata company cites statistics.

"Now it is difficult to single out a group of budget foreign destinations. Everything has become more expensive. It has risen in price by about two times. There are not many destinations available. But Turkey and Egypt, even despite the price increase, are still leading in terms of [sales]", - commented Maya Lomidze, Executive Director of the ATOR Association.Travel agents, however, hope that the big jump in January is only a consequence of increased New Year's demand, and then prices will adjust, tours will remain more or less accessible to Russian tourists.

The regulation of the cost of travel packages is also influenced by the purposeful actions of the receiving and sending parties.

"We do not take the peaks of tourist activity, for the rest of the time the Egyptians are clearly trying to keep prices at a minimum level and earn not at the expense of a high margin from each tourist, but at the expense of the number of vacationers. The Egyptian side even changed its mind about raising prices for hotels. Even at the booking prices are quite reasonable, and for tour operators the price tag is obviously even lower. Prices are calculated according to the official dollar exchange rate, and it has been quite divine lately. So it seems more plausible to me that "ours" earn from this price increase, this is my personal subjective opinion", - says the traveler, writer (lived in Egypt for 10 years) Maria Zagainova.The consequences of the pandemic, general geopolitical tensions, economic uncertainty, fear of sanctions for partnership with Russia, and a drop in the purchasing power of Russians also affect the pricing of a tourist product.

"Hotels in Egypt and Turkey are trying to compensate for losses after two years of COVID-19, and as a result we get a price increase. This does not affect the demand in any way yet, people are ready to go for X 2," ATOR comments.

However, there are other Russian tourists - today they do not dare to travel abroad, fearing to get stuck in a foreign country for an indefinite time if another emergency happens. This factor of "fear" also affects the economy of the industry.

But there is also good news. Turkey and Egypt are still very interested in tourists from Russia and the CIS. They are trying to solve the problem with reduced Russian flights, and three "windows" have already been opened for today.

Turkey has launched its airline specifically for Russian tourists, and this is in addition to regular flights of Pegasus and Turkish Airlines to several Russian cities. Egypt, too, would not mind its own flight program, but after the Sinai A 321 disaster, only Russian airlines have always carried out air transportation to resorts, this was a fundamental requirement on our part.

In mass foreign destinations in 2022, sales were also helped by the new practice of cooperation between tour operators. Due to the difficulties with air travel, they decided to switch from competition to alliance, chartering joint charters to Turkey, Egypt, the UAE, Cuba, etc., ATOR (Association of Tour Operators of Russia) says.

Finally, the third way out is to combine domestic and international flights into one package.

"At the meeting with airlines, the results of transportation in the summer season of 2022 and the prospects for the operational activities of airlines in the upcoming winter season were discussed. In particular, airlines are working with tour operators on the possibility of combining domestic and international flights in one package", - the Federal Air Transport Agency reported in October 2022.

In other words, the combined flight includes a block of seats for a flight abroad and a block of seats for a flight in Russia.

As Dmitry Gorin, Vice-president of the Russian Union of Travel Industry (PCT), explains, there is a shortage of international air transportation in Russia. It is quota-based and limited, it is not carried out from all cities, and the number of aircraft that can fly abroad is several times less than in the domestic market.

"Airlines with the regulator are solving the issue of additional loading of domestic flights to Russian cities from where international flights are operated. You can still buy tickets at a pass-through tariff now. But guaranteed blocks of places are important for package tourism. And tour operators will be able to use guaranteed transportation on domestic and international flights in their travel packages. The merger allows us to expand the network of offers from different regions of Russia, to build an optimal route in terms of direct flights to the international airport", - Gorin added.

Thus, due to the increase in the flow of passengers on domestic flights, tour operators receive a better price for an international flight, which has a positive effect on the cost of the package. Such an offer is already more profitable than independent travel.

Domestic tourists, in turn, receive additional flights to and from regions (where there are international airports). And one more beneficiary - airlines and airports are raising their transportation targets.