Tourists are looking for better value for money, ETC report shows

European tourism showed strong resilience in the last quarter of 2024 despite economic pressures, geopolitical uncertainties, adverse weather conditions and changing consumer behavior. The latest European Commission travel report (ETC) shows a 6,3% increase in foreign arrivals compared to 2019 levels and a 6,7% increase compared to 2023. Overnight stays also increased by 5,9% compared to 2019 and 4,8% year-on-year.

Report "European Tourism Trends and Prospects" for the fourth quarter of 2024 offers insight into the dynamic performance of European tourism during the autumn and winter period and provides a comprehensive analysis of the latest tourism and macroeconomic developments in the region.

While travel outcomes remained strong, the report shows that consumers are increasingly opting for destinations that are good value for money. This is likely due to higher travel costs caused by increased service inflation and increased travel demand. The latest estimate suggests that in 2024 tourists spent 7,8% more across Europe than in 2023, amounting to €705 billion, with almost three quarters of total regional spending driven by Western European tourists.

"As we look towards 2025, European tourism will continue to navigate an increasingly complex landscape and heightened geopolitical and economic uncertainty. Despite challenges such as rising travel costs and changing consumer preferences, the European tourism sector has shown remarkable resilience. At the same time, we are witnessing positive trends, such as the increasing focus on off-season travel, which is spreading tourism demand more evenly throughout the year. Looking ahead, maintaining this momentum will require strategic investments in a diverse offering to ensure continued performance and competitiveness, ETC President Miguel Sanz commented on the report.

Travelers are looking for good value for money in the off-season

Compared to the previous quarter, tourism performance is stronger in both arrivals and overnight stays, indicating that travel towards the end of the season (September-October) and during the winter period remained strong. This trend is in line with growing consumer preferences for value-for-money travel, because those months usually offer lower prices. In addition, extreme summer temperatures in some sub-regions and lower passenger numbers may have affected travel patterns.

Southern Europe slows down as northern lights draw tourists to Iceland

After a strong summer period, several southern and Mediterranean destinations recorded slower results in the fourth quarter, including Portugal, Serbia, Greece and Montenegro. Montenegro was the only destination in the reports with fewer arrivals than in 2023, and tourists are likely to go elsewhere due to the influx of recent years. Serbia, Portugal and Greece recorded weakened growth in arrivals from the third quarter, but are still up significantly compared to 2019, by 28,9%, 17,8% and 13,7% respectively. However, some southern and Mediterranean destinations managed to buck this trend, including Italy, with arrivals up 5,9% and overnight stays up 10% compared to 2019 figures.

Iceland, on the other hand, saw a 14% increase in arrivals in the fourth quarter compared to 2019, making it the fastest-growing winter tourism destination. The increase was driven by increased solar activity, attracting visitors eager to witness the northern lights, with strong demand from Germany, the Netherlands, Italy and the United Kingdom.

Weather conditions continue to affect travel

Extreme weather events, including floods, storms and snowfall, affected travel across Europe, leading to delays and cancellations in major hubs such as France, Germany, Spain and the United Kingdom. The Spanish region of Valencia was particularly hard hit by the heavy flooding, with arrival growth slowing in November (4,2%) and December (-6,3%) after a strong performance in the rest of the year, when arrival growth outpaced Spain as a whole.

Long journeys are lagging behind

Looking ahead, the recovery in long-haul travel is still lagging behind, with final figures for 2024 showing it to remain 5% below 2019 levels. This is largely due to the slow recovery in the Asia/Pacific region, particularly in China. Travel demand from this market has been largely focused on regional travel, with fewer long-haul trips, particularly to Europe, due to limited connectivity and visa requirements. On average, arrivals from China to European destinations are 39,6% below pre-pandemic levels.

In contrast, US transatlantic travel has helped maintain momentum during Europe's post-pandemic recovery. However, uncertainty is rising under the Trump administration as inflation risks could reduce disposable income, potentially reducing international travel. In the fourth quarter, 22 of 27 destinations reported higher arrivals from the US that exceeded 2019 levels, led by Turkey (+153%), Portugal (+91%), Lithuania (+67%) and Montenegro (+49%).

Cover photo source: Gorski Kotar Tourist Board