Consumers ‘sitting on huge pots of cash’ will fuel travel recovery

The recovery of the travel market will be buoyed by consumers’ savings, vaccines and air corridors, according to a tourism forecaster.

David Goodger, managing director for Europe and Middle East with Tourism Economics – part of the Oxford Economics forecasting consultancy, said the rebound will begin in 2021 but the market will still lag behind 2019 levels.

However, pent-up demand from consumers “sitting on huge pots of cash” and the economic recovery mean he is optimistic that the recovery will continue.

Speaking during the first day of the online Brand USA Global Marketplace on Tuesday (April 20), Goodger said leisure travel will lead the way, along with domestic and short haul. Surveys show increasing caution among UK travellers about their choice of destination, he explained.

Compared to 2019, UK outbound travel was down by 73% in 2020 but will be about 50% down in 2021.

For long-haul travel, there was an 80% fall last year and 2021 is expected to be 64% down on 2019.

It is not likely to return to pre-pandemic levels until 2024.

As well as pent-up demand, other factors supporting the recovery are the stability in the sterling exchange rate after Brexit; the rollout of vaccines; and travel corridors.

The virtual event also heard from aviation bosses about the transatlantic airline market.

Nigel Mayes, senior vice president at Airport Strategy & Marketing, said that there had been 1,100 weekly passenger flights across the Atlantic, connecting 71 city pairs, before the pandemic.

Now there are just 200 a week, linking 20 city pairs.

Bill Byrne, Aer Lingus’ global sales director, said he was “excited” by the airline’s four new routes from Manchester, the first of which starts in July, but said it was too early to talk about the potential for extra services to be added.

Bob Schumacher, United Airlines’ UK and Ireland director, commented that he was “delighted” about a new service linking Heathrow and Boston which will start this summer.

Like Byrne, he said carriers will build their networks back up according to demand and the “appetite for travel”.

Rikke Christiansen, vice president of networks, alliances and commercial planning at Virgin Atlantic, said the airline is currently relying on cargo for the bulk of its revenue.

She said the VFR (visiting friends and relatives) market will return first followed by leisure, then eventually the corporate sector.

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