European traffic outstrips sales in 2005

Emily Pacey

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The latest ETRC Index reports full year results for 2005, revealing low growth rates for the European industry

International passenger traffic grew at almost three times the rate of sales in 2005, according to the latest edition of the European Travel Retail Council's (ETRC) Index, which revealed fourth quarter and full-year figures for 2005.
 
European travel-retail sales grew by 2.9% in 2005, while passenger traffic increased by 7.9%. However, this does not reflect a  narrower gap between the two variables in the fourth quarter, when sales rose by 5.3% and traffic increased by 5.8%. The report attributed the low yearly results to a poor first quarter in which all product categories trailed the growth in traffic figures.
 
Beauty, confectionery and liquor recorded positive trends in 2005 compared to 2004, increasing at 6.8%, 4.6% and 4% respectively. However, all other categories failed to reach the same levels of sales as 2004, although all showed an improving trend over the year. Tobacco sales grew by 5.7% over the year but fell well short of 2004 results.
 
The ETRC once again indicated a problem with penetration, blaming the disappointing trend recorded in 2005 on the increased frequency of travel, particularly on low-cost carriers.