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Rewe tourism units positive on FY sales

Thu Jul 2, 2009 9:00am EDT

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* To outperform market, may break even - CEO

* Trend towards more short-term bookings

* To keep prices broadly stable this winter

FRANKFURT, July 2 (Reuters) - The modular travel division of Germany's Rewe Group sees full-year sales slightly below last year, although they should outperform the market and may break even in spite of the global recession, Chief Executive Michael Frese said.

Dertour, Meier's Weltreisen and ADAC-Reisen -- the modular and long-distance units of Germany's third-largest travel company Rewe -- see a clear trend towards more short-term bookings amid growing economic uncertainty, Frese said.

"If the current trend lasts, we may even reach breakeven," Frese said in speech prepared for the presentation of the units' winter season catalogues on Thursday.

"We will definitely be better than the market," Frese said.

The three units - which sell different parts of a holiday separately so that the customer can chose independently which flight, hotel or tour to go for -- posted sales of more than 1.5 billion euros ($2.12 billion) in their fiscal year 2007/08 to Oct. 31.

Overall, German tour operators' sales were down about 7 percent at the moment mainly due to lower airfares and Frese said the market may end 2008/09 down about 5 percent.

The travel industry has been hard hit by the global recession as companies and households tighten their budgets, forcing airlines to ground planes, cut capacity and prices amid a dire industry outlook. [ID:nJAK466740]

The world's airlines lost more than $3 billion in the first quarter of 2009, the International Air Transport Association said on Tuesday, keeping its estimate for full-year losses of $9 billion. [ID:nLU644766]

The German operations of TUI Travel (TT.L) plan to cut their prices in the coming winter season by an average of 5 percent, having been able to get better rates on hotel rooms and lower fuel costs. [ID:nFAB013167]

Dertour, Meier's Weltreisen and ADAC Reisen will keep prices broadly stable this winter season, but will also offer discounts in some regions, Frese said. Further declines in hotel prices and airfares, however, could lead to more price cuts, he added. ($1=.7077 Euro) (Editing by Simon Jessop)



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