Travel industry back on the go again
Whereas in recent years holidays were more limited to balconies or domestic trips, airliners and long-distance travel are now in high demand again. Almost all countries have removed their pandemic-related restrictions and there are no more obstacles to holidays in popular vacation destinations.
Strong demand despite high prices
Those looking for bargains will be bitterly disappointed: High fuel prices, generally strong inflation, and pent-up demand have made travelling significantly more expensive. Nonetheless, people are not letting this stop them and according to the forecasts the tourism industry is looking forward to a record-setting summer.
Tourism as a global growth market
In recent decades, global tourism has generally grown very strongly. According to data from the World Tourism Organization (UNWTO), there were around 1.46 billion cross-border trips in 2019, up from just 25 million in 1950. While the pandemic did put a major dent in this rapid growth, the underlying trend remains intact and more increases can be anticipated in the years ahead. However, some interference may come from additional levies and taxes designed to intentionally make flying more expensive as a measure against climate change, or from geopolitical developments.
At the same time, travellers themselves are also becoming more and more demanding. Travel packages and all-inclusive are out of fashion at the moment, as travellers look for adventure and variety. For example, short city trips that people put together themselves have superseded traditional beach holidays.
Independent travel is “in”
With its high price transparency, easy availability, and ever greater volume of accessible information, the internet opens up limitless opportunities. Strong growth is being registered for portals such as Booking.com, Expedia, and TripAdvisor, while previous market leaders are struggling. Service providers such as Airbnb are disrupting the hotel market and generating strong competition for established players.
Investing in the megatrend
The portfolio of Raiffeisen-MegaTrends-ESG-Aktien includes hotel chains such as the budget hotel specialist Whitbread and the luxury hotel operator Marriott, which has brands such as Ritz-Carlton and St. Regis. There is also investment in online platforms such as Booking.com and Airbnb (which already have a monopoly-like position in some countries). Due to the relatively low overhead costs, companies like this have an easily scalable, flexible business model and can react very dynamically to changes in demand. Additionally, companies such as TUI also stand to profit from the rampant growth in demand. Despite its structural problems, over the short term at least TUI will probably be able to present good news, which will be honoured accordingly on the markets.
Tourism industry: Great potential, but challenges abound
The tourism industry offers great growth opportunities, but is also faced with great challenges, due to climate change and geopolitical developments. Raiffeisen-MegaTrends-ESG-Aktien invests in promising companies that profit either directly or indirectly from this trend. Naturally, compliance with very strict ESG criteria is closely monitored. Because significant parts of the global tourism industry still have a cavalier attitude to the environment and resources, and social factors (treatment of employees) also deserve criticism in some cases. It should be mentioned that, completely disregarding the recent pandemic, this industry is also exposed to cycles and fluctuations, which result in additional opportunities as well as risks. Consequently, continuous, careful asset selection and close market monitoring by way of active fund management is even more important.
The fund exhibits elevated volatility, meaning that unit prices can move significantly higher or lower in short periods of time, and it is not possible to rule out loss of capital.