The Future of Travel in the Covid-19 Era

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After being shut down for nearly a year and a half, international travel has started to pick up again, with countries in the Caribbean, Africa, and Europe paving the way. The reopening of borders has been far from straightforward as the world negotiates inequities in Covid-19 containment, vaccine access, and economic recovery. And everything can change in an instant.

For airlines, airports, cruise lines, and hotels, the new normal is increasingly looking like the old normal; While advanced cleaning protocols are (happily) here to stay, social distancing and even mask requirements have started to peel away. A lack of cohesive guidelines from governing authorities mean that protocols are being patched together by individual properties and companies, leaving consumers to wade through fine print and determine what fits their risk thresholds.

If the wealthiest initially set the tone for the future of nonessential travel, the masses are now unleashing a storm of pent-up demand that has caused prices to multiply and availability to evaporate. Compounding those issues are labor shortages in many popular vacation destinations, already slim inventory gobbled up by last year’s cancelations, and a hampered import market that’s making it impossible to get a rental car or wrap up that hotel renovation. Consumers may feel safe traveling again, but it’s going to be a bumpy rebound.

Those of us who remain stuck in place can still daydream. According to the National Institutes of Health, simply planning a trip can spark immeasurable joy—and there’s high hope that the ongoing challenges of availability and border restrictions will iron themselves out by 2022. Getting into an adventurous frame of mind can remind us of the power of travel—not only in the billions of dollars in daily economic activity but also to forge cross-cultural connections and bring us closer to those we love.

Key Coverage

By The Numbers

  • $150 million The amount of cash U.S.-based airlines were losing on a daily basis as of March 2021.
  • 1.2 million Average increase of daily travelers passing through TSA checkpoints in June 2021, compared to June 2020. The number still represents roughly a 30% decline from 2019 figures.
  • 67 Percentage of people who would feel confident traveling once vaccinated.

Why It Matters

It’s not just your vacation or business trip that’s on the line. The travel industry customarily accounts for 10% of the global economy, rippling to the remotest corners of the world. Each trip a person takes sets off a domino effect of consumption that directs dollars to airlines, hoteliers, restaurateurs, taxi drivers, artisans, tour guides, and shopkeepers, to name a few. In all, the tourism industry employs 300 million people. Especially in developing countries, these jobs can present pathways out of poverty and opportunities for cultural preservation.

In 2020, the pandemic put a third of all tourism jobs at risk, and airlines around the world said they needed as much as $200 billion in bailouts. By December, the World Tourism Organization had tallied $935 billion in global losses from the tourism standstill, and was estimating that the ripple effects would result in a total economic decline exceeding $2 trillion. Even with international tourism now cautiously reopening, the organization expects that the world will not return to 2019 tourism levels until 2023.

According to data from the World Travel and Tourism Council, every 1% increase in international arrivals adds $7.23 billion to the world’s cumulative gross domestic product. Any improvement in this sector is significant—and it’s just beginning.

Americans, who have easy access to vaccines and command an overwhelming share of the international travel market, are back on the road; two-thirds intend to take a trip in 2021. In the U.S., flight capacity has climbed back to 84% of 2019 levels. The questions are what it will take for the rest of the world to catch up and how the industry must evolve to be flexible at handling future Covid-19 variants so travelers will feel safe and willing to spend.

Grounded for many months, airlines are beefing up their summer schedules—though the number of flights will be a fraction of their pre-pandemic frequency. Airports are still mostly ghost towns (some have even been taken over by wildlife), and international long-distance travel is all but dead. Around the globe, the collapse of the tourist economy has bankrupted hotels, restaurants, bus operators, and car rental agencies—and thrown an estimated 100 million people out of work.

With uncertainty and fear hanging over traveling, no one knows how quickly tourism and business travel will recover, whether we will still fly as much, and what the travel experience will look like once new health security measures are in place. One thing is certain: Until then, there will be many more canceled vacations, business trips, weekend getaways, and family reunions.

Travel will normalize more quickly in safe zones that coped well with COVID-19, such as between South Korea and China, or between Germany and Greece. But in poorer developing countries struggling to manage the pandemic, such as India or Indonesia, any recovery will be painfully slow.

All this will change the structure of future global travel. Many will opt not to move around at all, especially the elderly. Tourists who experiment with new locations in their safe zones or home countries will stick to new habits. Countries with strong pandemic records will deploy them as tourism marketing strategies—discover Taiwan! Much the same will be true for business, where ease of travel and a new sense of common destiny within each safe zone will restructure investment along epidemiological lines.

With the support of IATA and others, the International Civil Aviation Organization developed a global restart plan to keep people safe when traveling. Restart measures will be bearable for those who need to travel, with universal implementation the priority. It will give governments and travelers the confidence that the system has strong biosafety protections. And it should give regulators the confidence to remove or adjust measures in real time as risk levels change and technology advances.

Contributors: Nikki Ekstein

Source: The Future of Travel in the Covid-19 Era – Bloomberg

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Critics:

The COVID-19 pandemic has impacted the tourism industry due to the resulting travel restrictions as well as slump in demand among travelers. The tourism industry has been massively affected by the spread of coronavirus, as many countries have introduced travel restrictions in an attempt to contain its spread. The United Nations World Tourism Organization estimated that global international tourist arrivals might decrease by 58% to 78% in 2020, leading to a potential loss of US$0.9–1.2 trillion in international tourism receipts.

In many of the world’s cities, planned travel went down by 80–90%.Conflicting and unilateral travel restrictions occurred regionally and many tourist attractions around the world, such as museums, amusement parks, and sports venues closed. UNWTO reported a 65% drop in international tourist arrivals in the first six months of 2020. Air passenger travel showed a similar decline. The United Nations Conference on Trade and Development released a report in June 2021 stating that the global economy could lose over US$4 trillion as a result of the pandemic.

References

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