Comment: A gruelling shakeout of the travel sector lies ahead

PC Agency chief executive Paul Charles asks what the future of the industry may look like

Amid the backdrop of a tragic and alarming number of coronavirus-related deaths, and thankfully survivors, we now need to prepare for what will be the most exhausting shakeout of the sector we love to work in.

It’s already begun with airlines like Avianca and Flybe going under, cruise lines such as Carnival laying off hundreds of people, and hotel groups putting off thousands of new openings worldwide due to lack of demand. We’re sadly only at the beginning of the beginning. After the generous UK furlough scheme comes to an end, the ‘R’ of this crisis won’t just stand for reproduction in a medical sense – it will mean restructuring and redundancies, but then hopefully rebuilding.

The travel industry will never look how it did in early 2020 as changing consumer demands and the risk of re-infection determine change. So what lies ahead?

The values of being caring and responsible will define the successful companies of the future. Customer services teams will be trained to care more; stakeholder happiness will be more important than profit.

Demographics will change. The baby boomers will make way for the 18-35 age group who will be ready to travel as soon as possible, and as far as they can, because they will be less averse to the risk of infection. The 60+ age group will find it hard to get travel insurance, be nervous of catching Covid-19 and will prefer to stay close to friends and family in the UK, as well as close to a proven healthcare system.

Airports will take on a different role, taking temperature checks and testing, in effect becoming filtering centres for those deemed healthy enough to fly. We will have less appetite to spend hours in the terminal eating or shopping before we fly, denying airports their major retail revenues.

Airlines will choose to fly only their most modern aircraft, with A350s and 787 Dreamliners healthier for us to fly in and cheaper for carriers to operate due to fuel efficiencies. They will remove extraneous weight onboard and become more sustainable. Out with the inflight printed magazines and plastic meal trays and in with the bamboo cutlery.

Destinations will need to reset and ask themselves what and who they are for? Several will pursue a high-value, low-volume tourism strategy focusing on higher spenders who stay in destination longer. Cities will need to find new reasons to attract visitors who are sceptical about being in built-up areas, taking public transport and including major indoor attractions on their itinerary. Space and privacy will win out. Outdoor and nature will be much sought-after.

Hotels will have to find new ways of keeping guests busy and entertained. Guests are likely to be shy of swimming pools and spas for some time, as these won’t fit with social distancing measures. Hotels will need to offer more activities such as cycling, walking tours and garden visits which guests will feel more relaxed and comfortable doing. Self-service will have to be more extensively offered, with buffet breakfasts switched to room service breakfast and bellboys stopped from carrying luggage to your room.

Unlike previous recessions and recoveries, this cycle will look very different. So deep and geographically widespread will be the impact that it will, unusually, be economy first, luxury last in terms of rebounds. That switch in itself will change the dynamics of travel for the next decade.


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