The British pound’s plunge is good news for international travelers thinking about a trip to the UK in the near future but terrible news for British holidaymakers. And the impact over time is almost certainly negative for everyone.
For years, sun-deprived Brits have used their relatively strong currency to enjoy affordable holidays to euro zone countries. Spain is the destination of one in five outbound trips of UK and Irish residents, according to European Union data. But the weaker pound will make those holidays more expensive for Brits in sterling terms.
Tour operators may also charge UK travelers surcharges to make up for the difference in cost in local currency terms at non-UK destinations due to the sharp moves. “This is legal,” the Association of British Travel Agents is reminding people.
Just because you’ve paid for your holiday doesn’t get you out of those fees, ABTA says. Tour operators can charge up to 10% of the trip’s cost between when you book and when you’ve traveled, although the company must absorb the first 2% of additional cost and make it clear (read: it’s probably in the fine print) to travelers ahead of time.
But aside from more expensive travel in the short-term, more severe impacts could be felt two years down the road, the earliest point when the UK could actually officially leave the EU.
It could affect the air-rights agreements that allow for UK carriers to easily open new routes and expand schedules within the EU and mean more expensive fares for not just British citizens. That’s why airlines like easyJet are lobbying the UK government to make sure the UK stays part of the single EU aviation market.
Investors don’t seem so reassured. Airline stocks are plunging, with British Airways parent International Airlines Group, down 20%. EasyJet shares are off 17%.
Brexit has another unwelcome side effect for travelers: It could create more onerous visa requirements, and even longer immigration lines at the airport.