Overview: what coronavirus means for the travel industry

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Helen Fanthorpe
7/2/2020

With government bans on non-essential travel, airline fleets grounded and bars and restaurants closed around the world, the tourist industry has been hard-hit by the coronavirus pandemic. But as lockdowns are gradually lifting and societies start to reopen – observing social distancing measures, of course – we ask what coronavirus will mean for the travel industry going forwards. Here, we share our projections for the rest of 2020 and beyond: and don’t worry, you won’t have to kiss your summer holiday goodbye just yet!

Taking a hit

Tourism has been one of the industries most damaged by coronavirus. Airlines, hotel chains, cruise companies, bars and restaurants and travel media have all experienced unprecedented losses; they are almost universally closed as people follow government guidelines to stay at home. Big-name players have not been exempt from the fall-out: Flybe went into administration as early as 5 March, Lonely Planet announced it would be shutting down most of its operations in London and Melbourne in April and just this week British Airways released plans to make 12,000 of its staff redundant. The big figures are no less worrying: a statement from the World Travel & Tourism Council suggests that across the sector we can expect a titan 100 million job losses due to the pandemic.

But what will airlines going under or scaling back mean for travellers going forwards? In the short term, carriers everywhere will be operating fewer flights and routes to match decreased demand. The good news? To give flyers more confidence to book, many airlines have changed their policies to increase flexibility, making it easier for customers to cancel or change their travel plans right up to the point of departure. Looking further ahead, as the industry begins to revive, routes will gradually reopen and flight numbers will rise – we’ve seen the industry recover before (think: 9/11) and we’ll see it again. While fewer routes could mean higher flight prices, there’s just as likely to be a raft of offers and incentives as airlines try to encourage travellers to take to the airs once more.

The lifting of lockdown

As countries around the world start to gradually lift their lockdowns, people everywhere are beginning to look towards the future. Restrictions are already being relaxed in European countries including Italy, Spain and France, while New Zealand has declared coronavirus “eliminated” within its borders.

Greece, meanwhile, has withstood the pandemic better than many expected, and is also looking to lift many of its lockdown restrictions. In a country where tourism accounts for one in five jobs and contributes 20 percent of the GDP, its government is already thinking about how to revive this lucrative industry. The Greek tourism minister has indicated that the country is looking to once again open up to visitors, but with a slew of new rules to protect public safety and ensure social distancing remains intact – measures including, for instance, middle seats being left vacant on planes.

Tourism provides an invaluable revenue stream for countries the world over. Given economies have been shaken to their roots during the crisis – by the collapse of entire industries as well as additional funding for healthcare resources and propping up small business – we are likely to see plenty of governments following Greece’s lead in the coming weeks in thinking of new and creative ways to start bringing visitors back safely to their shores.

We're dreaming of exploring again © Maria Savenko/Shutterstock

Bouncing back

Looking to China, where the outbreak began – and the first country to lift its lockdown restrictions – could give us some early indications of what we can expect here in the UK and further afield. The tourist industry in China is already showing some signs of recovery. Figures in early March reported by Bloomberg showed hotel bookings up 40 percent, and domestic flight bookings growing an optimistic 230 percent. Regional tourist boards are keen to bring back the punters, too, employing the same creativity and imagination that we’ve seen businesses harnessing around the globe to stay afloat in these unprecedented times. In Southwest China’s Guizhou province, a new online reservation platform has been rolled out, where you can book catering, accommodation and transport using a single QR code. In addition, more than 90 percent of the area’s tourist attractions have now reopened.

A domestic summer holiday

With the increased risks associated with busy airports and global movement, it looks like there will be a focus on domestic travel for much of the rest of the year. At present, there are still travel bans in force across the world, and some nations – such as Argentina – have extended flight bans well into the future (in this case, until September). But jumping in a car, filled with your immediate family, and hitting the road to shack up in a countryside cottage or seaside chalet? Yes, please. A holiday like this is obviously much less risky: there’s no crowds or danger of spreading the disease across borders. And with flights and bookings still subject to cancellations, delays and general uncertainty, there’s much less risk of losing significant sums of money on abandoned trips – especially when travel insurance covering Covid-19 is still hard to come by.

The good news is that there’s likely to be a strong appetite for domestic travel in the coming months. As lockdowns start to lift and life starts to adjust to a new sort of normal – still characterized by social distancing – people will want to break out of their confines, leave stifling cities behind and escape to the great outdoors. And with tourist boards everywhere keen to get people back travelling safely, it’s likely that we’ll see domestic travel start to rebound.

And that’s not to say that a summer holiday abroad is necessarily off the cards either, though there are obviously more risks involved. That said, many countries are introducing initiatives to help travellers feel safe and at ease: Austria has announced its hotels will be open from 29 May, while Portugal plans to attach a “Clean & Safe” stamp to tourist businesses that meet hygiene regulations aimed at protecting against Covid-19.

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    Into 2021

    Towards the end of 2020 and into 2021, we anticipate that the travel industry will begin to return to normal. As the world emerges from the coronavirus pandemic – with infection figures low enough that Covid-19 is essentially contained, potentially with a vaccine becoming available – confidence will start to return, and the appetite for international travel will be revived. Key players in the tourist industry – tourist boards, airlines and hotels around the world – will also invest in bringing visitors back in a safe way, which will mean some great deals to choose from.

    With a hard-learnt reminder to live every day to the full and plenty of time at home daydreaming, there will be as much desire to travel as ever before.

    Sarah Clark, Head of Publishing at APA, says: “While there’s no doubt that the Covid-19 pandemic is an unprecedented event in our lifetimes and has had an impact on a scale not seen before, the travel industry has been knocked by major incidents before and it always rebounded; rumours of the demise of travel tend to be greatly exaggerated. Although our freedom to travel as we did before may take a while to be restored, the appetite to do so is there – and I’m sure that our appreciation for holidays and discovering the world will be more profound than ever!”

    If you are planning to travel, visit our up-to-date article with the latest news on Corona virus and travel. And check out how to make sure that your travel insurance covers Corona virus.

    Top image © Ekaterina Pokrovsky/Shutterstock

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