Tourism in the Corona crisis
What about the travel industry: is the entrance to the house burning or is the fire already raging under the roof?
The airlines are gently raising their flight plans again, border openings to nearby countries are in sight. Vanessa Bay, who led the virtual panel discussion together with Dominik Buholzer, asked the group whether the dry spell for the travel industry had already been overcome?
The Swiss Travel Communicators are the leading Swiss network for those who deal with media work in tourism. The network invites well-known personalities from the industry to panel discussions four times a year. On the subject of “travel industry – does the corona virus lead to bankruptcy?” discussed on the virtual podium:
– Max E. Katz, President of the Swiss Travel Association
– André Lüthi, Chairman of the Board of Globetrotter Travel Service
– Dieter Zümpel, CEO DER Touristik Suisse
– Martin Reber, Managing Director of Schär-Reisen Bern AG
1 – The current situation: Repayments in the millions
Tour operators and travel agencies have all been struggling with the same problems since the onset of the Corona crisis. The first phase was to support the customers so that they can return to Switzerland. This was followed by a flood of cancellations and rebookings. Dieter Zümpel from DER Touristik, one of the largest travel providers in Europe, which also includes Kuoni and Helvetic Tours, says: “In the past week alone, we had to repay customer deposits of CHF 10 million.” André Lüthi from Globetrotter confirms: “We have had thousands of annulations so far.” The situation is dramatic. It is a phase in which the industry has a lot of work to do. But this additional effort is hardly offset by income. Max E. Katz from the Swiss Travel Association says: “What annoyed me is that during the lockdown weeks, people mostly discussed hairdressers and florists. That they are the ones who suffer the most. » These professional groups actually had no work for six weeks, “but on the day when they were allowed to open again, they had full agendas again.” In contrast, travel agencies have had to cancel the work of months in the past few weeks. And now that they open again, hardly any bookings come in. After all, politics helped with a so-called legal standstill. The travel agencies will not be able to operate until September 30th. This creates some air for now. Time must now be used to find sustainable solutions for the future, says Katz. André Lüthi confirmed: “Politicians want to help, they are looking for solutions.”
2 – A key problem: the airlines
Martin Reber from Schär-Reisen finds clear words on one topic: «What really drives me crazy is the fact that the airlines collect the flight costs up to eleven months in advance and the money according to the snowball principle before the customer’s departure as Need business credit. » The other panelists also share this opinion. They confirm that the problem has been accentuated in this crisis. The following is the problem: If a customer books a flight in a travel agency, the customer money is transferred to the airline. However, the airline often does not perform until months later. In the Corona crisis, however, travel agencies that have already transferred the money to the airlines are legally obliged to repay the money to customers for the canceled flights. At the same time, the tour operators and travel agencies have to be patient with the repayment on the part of the airlines. In such a crisis, airlines sometimes skid because they have already spent customer money on services that have not yet been performed.
There is agreement that something has to change in the system. Is that realistic? Max E. Katz rhetorically asks: “If not now, when?” And immediately puts a possible solution on the table: «A so-called escrow system would be desirable. The customer funds would go into a blocked account, the airlines will only receive the money when the flight has been carried out. »
How airlines handle customer funds is just one of many problems in this crisis. Not to forget that the airlines themselves are also suffering from the Corona crisis. For example, Swiss is currently losing more than CHF 3 million a day. And has now been obliged to pay the outstanding payments to the tour operators and travel agencies by the end of September.
And now – hang your head?
Most DER Touristik travel agencies have been open again since last week. And they are frequented again, which Dieter Zümpel is pleased about. In general, he does not see the crisis as black, but wants to tackle it constructively. However, he says: “Customers are coming who want to book again – but the incoming booking is homeopathic, almost zero.” The coming time will be advice-intensive. And further: “There is a huge amount of work ahead of us.” Because the customers will need a lot of support, as the destinations will reopen at different conditions.
For 2020, it is agreed that sales will decrease by 50-70 percent compared to the previous year. With a 50 percent decline, one speaks of a “best case” scenario. “Every travel company in Switzerland has to cope with that,” says Martin Reber, otherwise the bankruptcy wave will come. Without an aid package for the industry, many travel agencies are likely to have to close. “Of the 1,300 travel agencies, 20 to 25 percent should not survive,” estimates Max E. Katz. Already in April he predicted that tourism in the overseas destinations would only be possible again next year. “I’ll stick to it,” he doubles. For André Lüthi, too, the big question is when the remote destinations will open again. The travel industry does not expect a “back to normal” until 2023 or even 2024. And Max E. Katz is certain that tourism will change. He says: “In the future, travelers will be looking for vacations with fewer people and closer to nature.” Does this make travel more expensive, more exclusive and no longer immediately available? He can imagine that, Katz confirms. What André Lüthi from Globetrotter is happy about and what he also sees as an opportunity: «That is what I have been telling mantra for years – but what is normal? For me, it would be more conscious travel, taking the speed out, fewer trips per year, fewer short trips, but learning and experiencing something along the way. »
In conclusion, it should be noted that none of the podium participants complained. The facts have been mentioned by name, but the crisis is just as positive, or at least to be tackled with a lot of commitment.