A new place to spend euros: Estonia

by Sean McLachlan on

One of the greatest boons to travelers in recent years is the expanding eurozone. Gone are the days when you spent a few days in France, then wasted money getting your francs exchanged into lire in order to visit Italy. There were always a few odd coins left over that ended up sitting useless in the sock drawer.

At the start of 2011, Estonia has become the 17th country to join the eurozone. The kroon will soon become a memory as the old currency is phased out.

While this is good news for travelers carrying euros, it could carry a hint of future trouble. Many countries that adopted the euro saw prices rise as shopkeepers rounded up in the exchange. This is what happened in Spain, and prices never stopped rising. What used to be a budget travel destination soon became almost as expensive as the rest of Europe. Living in Madrid I’m constantly hearing Spaniards complain about how much more expensive things are these days.

Estonia has also become a budget travel destination in recent years. The Baltic republic may be small with only 1.3 million people, but it has an interesting history, some beautiful countryside, and a distinct culture. Hopefully it won’t get too expensive to experience all that.

Ryanair says “screw you” to stranded passengers – European Union sends them a copy of the law

by Scott Carmichael on

Ryanair CEO Micheal O’Leary played tough guy this week when he told his customers that he wouldn’t pay a penny to cover expenses resulting from being stranded due to the Icelandic Volcano.

In statements to the media, he admitted that he was fully aware of EU compensation laws, but chose to ignore them claiming:

There’s no legislation designed that says any airline getting a fare of 30 euro (£26) should be reimbursing passengers many thousands of euro for hotel accommodation. It’s absurd.

Well, unfortunately for Mr O’Leary, there actually is legislation that is designed just for that purpose. In fact, European air travelers are one of the most protected groups of travelers in the world.

As it turns out, European lawmakers may have told Ryanair to re-read the laws he’s bound to – because two days after his tough statements, the airline took a u-turn and confirmed that they would indeed be refunding passengers for “reasonably-receipted expenses”.

Greece finds itself in the middle of a pefect storm – economy down, tourism down

by Scott Carmichael on

Greece has long been one of the black sheep members of the European Union – it has always relied on huge farming subsidies as its fellow nations worried about the stability of the Greek economy.

This year, those stability worries became justified when their economy collapsed. A combination of poor financial decisions and the global economic meltdown forced the Greek government to turn to its fellow countries for a bailout.

Now the European Union has finally decided to bail the Greek out, sentiment about the scope of the bailout has left Europeans mighty annoyed with the Greek. So annoyed in fact, that many of them have decided to book their vacation elsewhere – removing one of the largest sources of Greek income.

German airline Air Berlin has described the drops as “massive”, but did not have any firm numbers to report on. Germany and the UK account for about 5 million tourists each year – a third of the 15 million that visit Greece each year. In 2009, tourism had already dropped 8%, so a continuing drop may prove to be a national disaster for Greece – especially since they’ll need to dig themselves out of their $400 billion debt pile sooner or later.

Gadlinks for Tuesday, 1.26.2010

by Katie Hammel on

Happy Tuesday, Gadling fans! Here are a few more travel tidbits to help you through the week.

More Gadlinks HERE.

Americans prefer independence (when traveling)

by Tom Johansmeyer on

The United States is the largest leisure travel market in the world – by far. The closest point of reference is the entire European Union. We’re three times larger than our closest competitor, the United Kingdom. Yet, despite our size, we just don’t spend as much money on packaged travel. In fact, the folks in the UK spend 50 percent more on it than we do.

Over here, the travel business accounts for $271 billion a year, according to travel industry research firm PhoCusWright, and only 7 percent of that ($18 billion) is spent on travel packages. Meanwhile, the UK has an $84 billion-a-year travel industry – not even a third of ours – and they spend $30 billion a year on packages (35 percent of the local market).

What’s the deal?

There are plenty of reasons bandied about. Europeans tend to take longer vacations, with 10 to 14 days not unusual (especially for the residents of northern European countries), and they tend to take more time off than the workaholics in the United States. They go more and longer, which translates to increased spending.

But, this doesn’t explain the affinity for packages. What makes Americans different?

Well, independence is a major factor. Americans usually prefer to set their own agendas, deciding what they want to see and do, taking on the task of research (and coming to places like Gadling – thanks, by the way, we all appreciate it) and putting together the pieces on their own.

Maybe we’re getting lazier or trying to seem like sophisticated Europeans, but the packaged travel market is growing on this side of the Atlantic, even rapidly. Of course, you need to compare it to starting point to understand how this can happen. In 1999, the packaged travel market was effectively nonexistent. Some large, enterprising online travel agencies, however, created a market from nothing, and turned it into an $8 billion space by the end of last year. This “new” offer has grown at a compound annual growth rate (CAGR) of 50 percent during this time, while tour operators have seen aggregate revenues decline at a compound annual rate of 5 percent.

So, we’re still not heavy package buyers in the United States, but taking the easy way out is becoming more and more attractive.