The fallout from the pandemic is laid bare, but what impact will it have on long-term pricing?
A whole host of recent news stories last have highlighted both the damage to the travel and tourism industry caused by the Covid-19 pandemic, but also the challenge the industry faces going forward.
International Air Travel Association (Iata) revealed 2020 saw only 1.8 billion air passengers compared to 4.5 billion in 2019. Passenger revenue fell 69% to $189 billion, with airlines losing $126.4 billion. Iata Director General Willie Walsh said 2020 “was a year we’d all like to forget”.
These figures follow on from World Travel and Tourism Council (WTTC) data that revealed the global industry lost US$4.5 trillion in 2020. With 62 million jobs lost and the sector’s share of global Gross Domestic Product almost halving – standing at 5.5% compared to 10.4% in 2019.
Furthermore, a poll of 1,000 people in the UK – by Holiday Extras – found that almost half (48%) said the “hoops travellers need to jump through” to travel is putting them off of going on an overseas holiday.
Only one in three said they are concerned about catching Covid-19 while on holiday. So it would appear that the confusion and constant changing of the travel lights travel system is what is putting people off from a holiday. The Covid-19 pandemic and fears over health are having an impact but not as considerable as the “hoops travellers need to jump through”.
The WTTC has called for the traffic light system to be simplified. Acting CEO Virginia Messina said the system is “confusing and damaging” and called for just a green and red list alternative.
“The UK should now open its doors not just to fully vaccinated travellers from the US and EU, but to double-jabbed visitors from all over the world too – showing we (the UK) are open for business and ready to welcome all safe travellers,” she said.
Less than one in ten polled by Holiday Extras said the increased cost was putting them off an overseas holiday. However, the outbound UK travel industry will have another challenge in 2023 with British travellers having to pay €7 from next year for the EU’s new European Travel Information and Authorisation System.
It is required for non-EU citizens who are exempt from needing a visa and must fill out an online form and pay the fee. The authorisation lasts for three years, and allows multiple trips across different countries in the bloc. It will come in to affect before the end of 2023.
An extra €7 will not be enough to stop British travellers visiting European holiday hotspots on its own, especially as it covers multiple holidays. However, there are wider concerns of the impact of both the pandemic and Brexit will have on the costs on holidays going forward.
Flights for this year appear to represent good value, with reports of one-way flights to Ibiza in August for as little as £8. However, there are concerns of steep price rises in 2022 onwards as the fall out from both the pandemic and Brexit start to bite.
For the WTM 2021 Industry Report, released on the first day of WTM – Monday 1 November – we have asked both UK consumers and the travel industry if they are worried holidays will become the preserve of rich in the future.
The response from both camps will be very interesting indeed.
Holiday Extras research