Race to the beach
The Covid-19 pandemic has hit no business sector harder than travel and tourism, but are we already seeing some signs of recovery?
In 2019, the travel and tourism industry accounted for 330m jobs worldwide, and 10.3% of global GDP. Then came the Covid-19 pandemic and in Q1 2020, international tourist arrivals decreased by 22%, with arrivals in March alone down by 57% following the start of lockdown in many countries.
UNWTO suggest that international tourist arrivals could be down between 58-78% in 2020. When compared to a decrease of 4% as a result of the recession in 2009 and a 0.4% decrease in 2003 after the SARS outbreak, it is clear that there is no precedence for what we are experiencing.
However, given the declining infection rates and the economic importance of the sector, there are increasingly positive signs for the industry. From mid June, depending on infection rates, many European countries are beginning to ease travel restrictions, with Italy (3rd June), Greece and Germany (15th June), and Spain (1st July) beginning to open borders more widely.
International travel is expected to recover slowly as quarantine measure vary across countries, but encouragingly, airlines are beginning to increase their flight schedules from mid June. Health and safety concerns aside, many customers are cautious to book as airlines and travel operators have been slow to refund trips booked for the lockdown period. The Secretary-General of the UNWTO calls trust the currency of our ‘new normal’, and indeed trust in both adequate health and safety measures, as well as reasonable flexibility when booking will be key to encourage travel going forward.
Most of the UNWTO Panel of Experts believe domestic travel will recover by the end of Q3 2020, with many European countries preparing to serve domestic tourists from early June, with countries like Germany and Italy even considering financial incentives, with a €500 tax bonus being discussed in Italy. In the UK, domestic tourism is likely to start on the 4th July at the earliest if restaurants and hotels are allowed to open.
The most probable scenario is that those in the highest risk categories will not travel at all this summer. The less risk averse will likely explore domestic destinations accessible by car. The FT reports an increase in searches for trips to Northern France, a 63% increase in reservations week on week for Classic Cottages, which rents properties in southern and western England, as well as a significant increase in domestic trips for campervans by Indie Campers. Aside from camping and holiday rentals, holiday parks where families and couples can have their own accommodation, such as Center Parcs and Forest Holidays are also likely to benefit. It is expected that the younger, low-risk groups will consider air travel for their summer holiday, and given that there are 17m millennials in the UK, this is a sizeable opportunity.
It will be a long road back to recovery, but at last we can begin to start dreaming about a holiday that is right for our level of risk. The #TravelTomorrow campaign reminds us that travelling is not just important for our mental health; it supports millions of workers employed in the sector; brings people together; enables us to learn about different cultures and promotes sustainability. Going forward, these values will leave a mark on how the industry will evolve.
Christina Roseler