A Leisure Travel Recovery Is Being Held Back By A Lack Of Standardized Testing And Foreign Entry Rules
A Leisure Travel Recovery Is Being Held Back By A Lack Of Standardized Testing And Foreign Entry Rules
The slow pace of development of a single global system for tracking and certifying the Covid-19 vaccination status of the world’s 7.8 billion people is delaying the beginning of a meaningful recovery of air travel demand.
No one is expecting business travel to begin recovering until late this year, and probably not even then. But the travel industry is desperately hoping to see the beginnings of a significant pickup in leisure-oriented travel this spring or summer. True, vacationers spend far less money on average than business travelers, but their typically huge numbers could help cash-starved travel service companies staunch the flow of red ink, bring back many of their laid-off workers and keep some of them out of bankruptcy.
Yet, even people who are tired of being cooped up by the pandemic, and who are eager to travel for fun again, likely won’t do so in large numbers until the industry and governments settle on a clear set of virus testing protocols and rules for crossing international, or even state borders. That’s according to a new study from travel consultancy IdeaWorks called 2021: How Airlines and Travelers Will Adapt as the Pandemic Recedes. It is a deep analysis of historical trends in human responses to major pandemics as far back as the 12th Century, and an analysis of current efforts to rekindle travel demand and the challenges that must be overcome to achieve that goal.
In a prior report the consulting firm projected that somewhere between 19% and 36% percent of the business travel traffic aboard the world’s airlines prior to the pandemic may never come back at all, or at least will take many years to do so. That’s because of adaptations businesses have made and continue to make in the absence of their ability to travel. The use of video conferencing tools like Zoom, Microsoft Teams and others, new ways of providing support, sales and training services online rather than in person, and other behavioral changes will continue to erode demand for certain types of business travel, it asserted.
While governments are intent on distributing vaccines as quickly as possible, “much of the world is unprepared for electronic health passports from technical and cultural perspectives,” the report says. “Creating a mobile application (to serve as an electronic health passport) is doable and deliverable. However, feeding that system with verified data from field locations throughout an entire country is a significant hurdle. This is an admirable and beneficial objective, but one that won’t be meaningfully achieved during 2021.”
Unlike most other economic sectors, which are expected to rebound strongly over the first four years after the current pandemic is perceived to be under control or eliminated, IdeaWorks’ analysis suggests that many of the effects of the Covid-19 pandemic on travel demand will linger for years. Business travel demand will be most heavily and negatively affected, and those affects will endure much longer than the pandemic’s affects on leisure travel.
That’s why, IdeaWorks suggests, travel service companies in general, and especially airlines now need to give serious thought to ways of attracting as many leisure travelers as possible. Though business travel is the motive behind just 29% of all passenger trips globally (and the motivation for as much as 50% of all trips on major global airlines that target business customers), business travelers tend to spend almost twice as much on their trips as the average leisure traveler. Thus, going forward airlines and other travel companies will need lots and lots of additional leisure travelers in the years ahead to partially make up for the lost revenue associated with whatever portion of business travel does not come back.
Jay Sorensen, IdeaWorks’ president, wrote in his prior report in December, “Recognizing that something significant and permanent is happening to our business culture is not a popular topic. The airline industry really wants a return to pre-pandemic spending on higher yield airline tickets for business trips. Most of this activity will return, but it’s crucial to realize that some will not.”
Changing the interior configurations of certain planes, especially widebody jets aimed at long haul and international routes, to increase the number of economy and “premium economy” seats – and reducing the number of premium class “suites” and lie-flat business class seats should be up for serious consideration at conventional airlines. Doing so could generate more revenue per plane load over the next few years – or longer. Currently, most big conventional airlines allocate larger-than-historically-normal amounts of space on their planes to seats typically bought by high fare-paying business travelers. Prior to the pandemic, and in most cases still today, conventional airlines’ business or first class seats feature spacious mini-office surroundings and/or seats that convert into lie-flat beds with partitions that enhance privacy.
“Consumers all over the world will continue their love of travel for vacations, adventure, relaxation, and to connect with family and friends,” Sorensen wrote in the new study. “Leisure travel has a significant advantage over business trips, because technology is no substitute for the sounds, tastes, and smells of being on a beach, in a forest, or on a mountaintop.” He suggests that the willingness people showed this past year to engage in outdoor recreational activities should grow and drive more demand for outdoor-focused travel later this year.
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