Former Spirit Airlines CEO Ben Baldanza argues for low-cost carriers that ‘living more on comfortable types of traffic’ can be ‘more aggressive in this environment’ and will ‘peak up’ due to their business model.
The outlook for travel switching has waned this year after a global epidemic devastated the industry and damaged the tourism-based economy as travelers postponed plans amid vaccine delays and border restrictions.
Tourist destinations from Thailand to Iceland hoped that the Covid-19 vaccine would allow countries to reopen their borders and drive much-needed recovery in 2021. Now, in some places the vaccine rollout is delayed and new virus strains appear, it seems probable. International travel can stall for years.
With less than a billion international arrivals, after declaring 2020 to be the worst year for record tourism, the United Nations World Tourism Organization says the prospect of a 2021 rebound has worsened. In October, experts %% surveyed by the agency believe that a 2021 rebound is possible. Only 0% said they believe that in January and some 1% did not think that travel would reach pre-epidemic levels by 2024 or earlier.
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James Sowan, who owns a catering transportation company for tourists in Fiji, called a staff meeting earlier this month and asked employees to start looking for other jobs. He recently took advantage of a government assistance program and brought back some scattered workers, hoping the vaccine would start traveling in early April.
But now Mr. Sova doesn’t think tourists will return until next year, and he and his wife can’t afford to pay wages at his company, Pacific Destinations Fiji. He borrows from his bank to keep some key employees.
“The hardest thing is seeing them in the eye,” Mr. Sowane said. “You’re looking at his wife and his children and his husband because we know them so well.”
According to estimates by the World Travel and Tourism Council, epidemics, travel, tourism and related business activity account for 10% of the global economy and one in 10 jobs. Many destinations, from the Pacific islands to Macau to Greece, were more dependent on tourism than that.
“People will go out of business,” said Ross Dowling, an honorary professor of tourism at Edith Cowan University in Australia. “If they can’t adapt, they won’t be able to survive, and they won’t be able to get relief in any situation next year.”
Reykjavિકk, the capital of Isaac, in the winter view from above
As of February 1, air tickets issued for international travel over the next six months were 15.5% higher than they were in 2019, up about 2 percentage points from January 1, according to travel analytics firm Forwardkies. According to data company Sirium, scheduled flights this month are down nearly 50% globally compared to February 2019, with some markets down about 90% lower, according to data company Sirium.
U.S. In, hotel demand company does not forecast to return to the level of 2019 by 2023, room prices will not fully improve by 2025, according to a joint forecast by hotel-data company STR and Tourism Economics. U.S. Total travel bookings, including hotel, air ticket and car fares, are expected to remain below the 2019 level in 2024, according to travel market research firm Focusright. He predicts that recovery in Europe will still be slow.
“Vaccines were expected to be highly panacea, but at current vaccination rates, according to a recent estimate by UBS, less than 20% of the world’s population is expected to be inoculated this year,” said Charuta Fadnis, who led FocusRite’s research team. We want governments to be careful when reopening borders. “
Some destinations popular among local travelers are optimistic that the impact of increased visits by locals will be lessened. But while last summer in Europe helped, it is unclear whether governments will lift sanctions like last year, a move that contributed to a drastic second wave of continental epidemics.
Temporary changes in the industry may begin to become permanent. Airlines and cruise operators mothball aircraft and ships and land or infiltrate thousands of people worldwide. Some hotels have closed to save cash until more customers return. Workers are looking for new careers.
At Cambodia’s ancient temple complex, Kangkor Wat, Sam Sophia organized 150 trips a month during the season. Now, Mr. Sophia, who lives with his wife and two sons, is unemployed.
Tourists visit the Grand Palace in Bangkok on May 24, 2014. (Reuters / Eric de Castro)
The number of foreign visitors to Angkor Wat fell 82% last year, and was 99.5% lower last month than in January 2020, according to the site’s ticket office fee. Mr. Sophia is considering buying a truck to pull gravel for new roads, although he plans to ride with her first to see if she is physically demanding with her nephew.
Mr. Sophia said, “I feel a little sad, a little stressed.” “I hope the tourists come back.”
In Spain, where travel and tourism previously accounted for about 14% of GDP, the highest percentage in the developed world, the economy fell 11% last year – the biggest decline in the eurozone. International arrivals fell by more than 75% in 2020. The government has poured billions of euros into the economy and secured jobs through furlough programs, but those efforts may soon be over.
While Spain’s central bank is forecasting 6.8% growth this year, the economy is not expected to reach its pre-epidemic level by mid-2023, almost a year later than the overall eurozone. Spain will return slowly in part as tourism will take time to recover, a central bank official said recently.
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The travel industry wants to speed up recovery with so-called vaccine passports, which include smartphone apps that travelers use to notify governments of their vaccination status so they don’t have to be isolated. Airlines and airports are testing various systems.
The government’s responses, however, have been mixed. UK officials have rejected Europe-wide vaccine passports, saying it is unclear whether vaccines are effective in preventing the transmission of the virus and whether people are allowed to travel on the basis of whether they have been vaccinated. Denmark, however, aims to issue one by the end of the month.
It’s also not yet clear if people will find it pleasant to travel again. Becky Wentland, a high school teacher in Southern California, has no plans to make a home flight until her family is vaccinated. Before moving abroad, she was waiting for a significant reduction in the rate of Kovid-19 infection and is keeping an eye on potential vaccine-resistant strains.
Her family would have traveled to Europe this summer had it not been for her virus. Last year, they canceled a trip to Japan. The trip to Peru was postponed this June, but will almost certainly be postponed again.
“I like to travel, but losing those trips was not heartbreaking for me,” Ms. Ventland said. “Travel is a total luxury and I will not lose sight of how horrible things are right now.”
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Some businesses and countries are confident that paint-up demand will eventually lead to a boom. Minor Hotels, which is located in Thailand but operates globally, has been steadily expanding during the epidemic, adding hotels in Europe and opening new properties in Dubai and the Seychelles.
In Iceland, the authorities used the time without foreign visitors to improve the country’s tourism structure. A few months ago, Iceland completed a short-distance route to the north of the country connecting tourist destinations, including the falls and its oldest settlement.
At the onset of the epidemic, Elias Gilas, director of quality and development at the Icelandic Tourist Board, thought tourists would return late last summer. Now with a full re-Ice acquisition in 2023, Iceland expects to receive a third of the normal number of visitors this year.
“The truth is no one knows for sure,” he said. “It all depends on how vaccinations go.”
