July 22, 2011 / 11:51 AM / 8 years ago

Record Swiss franc sends Swiss on holidays to Greece

ZURICH (Reuters Life!) - Holidaymakers don’t come happier than 39-year-old Swiss private banker Andreas Pletscher, who has just saved 2,000 euros ($2,840) on a two-week family holiday to Greece.

A tourist walks in front of the Parthenon temple at the Acropolis hill in Athens, July 10, 2011. Picture taken July 10, 2011. REUTERS/John Kolesidis

Wallets stuffed with the single currency, the Swiss are shunning Alpine resorts and flocking abroad. Sovereign debt woes in the euro zone have driven the safe-haven franc up some 6 percent against the single currency so far this year, after a rise of more than 15 percent in 2010.

“It’s substantially cheaper. We’ve saved about a fifth,” Pletscher said, smiling as he handed over his passport to check in for a flight to the Greek city of Patras. He plans to spend the extra cash on meals out and shopping.

Although the strong franc is a boon for tourists, it has prompted squeals from retailers and hoteliers, who see their profits disappearing into the tills of foreign competitors.

Exporters say they are close to breaching the pain threshold, and have lowered prices to keep orders afloat. Some companies are making staff work longer hours for the same wage, while others warn they may start paying employees in euros to control costs.

“The euro is hurting us more than the financial crisis,” Guglielmo Brentel, head of the Swiss Hotel Association told the NZZ am Sonntag.

Since 2008, the cost of holidaying in Switzerland has risen by a fifth for tourists from the euro zone, while Britons can now reckon with prices that are 35 percent more expensive, consultancy BAK Basel said, forecasting a fall in overnight stays from foreign visitors of 2.6 percent this summer.

In some of the worst affected Alpine regions, hoteliers are trying to lure holidaymakers from the single currency bloc by quoting prices in euros at a conversion 20 percent below the current market rate.


Not only for holidays are the Swiss splashing their cash abroad. About 70 percent of consumers have shopped across the border in the past year according to consultancy Fuhrer & Hotz.

Retailers estimate they are losing about 2 billion francs a year from so-called “shopping tourists.”

Swiss supermarket chain Migros plans to halve the floor space in a Basel shopping center store, given the lack of customers. Newspaper pictures depict eerily deserted aisles.

And it seems to be a one-way street.

The number of foreign drivers filling up on cheaper petrol is also down, according to reports, because the weak euro erodes the price advantage of getting fuel in Switzerland.

Last week economy minister Johann Schneider-Ammann prompted outrage from retailers for sympathizing with shoppers who hop across the border to stock up on cheaper food and clothing.

But Manuel Calvo, a trader at a bank who deals daily with the tumbling euro, said shops are wrong to blame consumers for hunting for value.

“It’s true, Swiss shops are suffering extremely under the strong franc. But they’re not lowering the prices,” Calvo, 30, said as he headed off on holiday to Mallorca.

“We’d be stupid if we didn’t go shopping abroad.”


Responding to industry woes, the government increased funding for tourism advertising earlier this year, but has since held off implementing further measures.

Nevertheless, politicians are keen to set a good example. Tabloid Blick am Abend published photos of prominent parliamentarians enjoying the Swiss mountains and lakes.

But such photos are unlikely to cheer Switzerland Tourism Chief Juerg Schmid, who finds the exodus of holidaymakers downright dispiriting.

As tens of thousands of Swiss jetted off to foreign climes last weekend to start the school holidays, Schmid urged his compatriots to think of domestic jobs and holiday at home.

“The trains are efficient, you get the room you’ve booked, every mountain has a train up it and everything is clean” he told Sunday tabloid Sonntagsblick.

Yet even the prospect of having to endure strikes and disorder in Greece is failing to lessen the attraction to the order-loving Swiss.

Bookings to the Mediterranean hot-spot are up more than 20 percent, while holidays to Spain have risen by double figures, said Peter Brun, spokesman for Swiss travel group Kuoni.

Competitor TUI Suisse has laid on 14 extra flights over the summer season to the most popular destinations — among them Kos, Crete and Cyprus — to cater for the growing demand, TUI Suisse spokesman Roland Schmid said.

“Depending on departure date, prices are now up to 30 percent cheaper than last year due to the favorable dollar and euro.”

Editing by Paul Casciato

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