Chief Executive Sebastian Ebel on Wednesday (12 August) admitted he did not know what the future held for First Choice following the launch of Sundeals, telling a media briefing: “Ask the British management.”
A Tui UK spokesperson then told TTG: “First Choice will remain as it is, continuing to service their existing customers. Sundeals will serve an incremental customer, one looking for a no-frills, low-cost package.
“First Choice is trading, taking bookings and looking after its customers.”
However, when TTG sought further clarification, Tui said: “There are no details on the future of First Choice at this stage. First Choice will continue to operate alongside Tui and Sundeals."
Sundeals was launched in the UK last month, hoping to challenge OTAs with a direct sell dynamic packaging offering aimed at the budget-conscious and late sales.
Its initial offering includes 20,000 hotels in more than 100 destinations, with flights from budget airlines like Ryanair, as well as Tui Airways.
Speaking as Tui posted its third-quarter results on Wednesday, Ebel said: “The focus for dynamic packaging will be Sundeals; First Choice never had the impact.”
He added: “It [First Choice] does not play the role it played five years ago. I would assume the focus will be on Sundeals.”
No change in retail policy
First Choice was once a major package brand. Tui acquired the name in 2007 and turned it into an all-inclusive operator between 2012 and 2019. It then widened its scope and in 2023, relaunched it again, aiming it at younger budget-conscious clients and signing up influencers to promote it.
The revamped First Choice offered camping, hostels, apartments and rail travel as well as traditional packages, aiming at those who wanted a package with more flexibility.
Sundeals will follow the model of Tui’s German budget brand Airtours in selling cheap traditional dynamic packages direct. Ebel explained these were previously sold under the Tui brand in the UK. “The market research found customers were not sure what they were getting,” he said.
Ebel said Sundeals was aimed at taking share from OTAs like Loveholidays and that Sundeals would help differentiate from the unique hotels offered by the Tui brand.
Ebel said the focus of effort in the UK was “90% Tui, 10% Sundeals.” He insisted retail sales remained “extremely important for us”, particularly in helping to sell Tui’s own-brand properties.
“Yes, it is an expensive channel, but it is a good channel that offers high margin products," he stressed. "It is not a change in policy.”