Summary
- The pandemic-battered travel industry is witnessing a ray of hope with promising developments in the vaccine.
- Travel players identifying the radical shift in the operating environment have revamped the business model that allows them to thrive in a challenging scenario.
- Australian airline Qantas Airways is planning to make vaccination mandatory for international travellers.
- In a bid to recoup, travel groups have moved towards technology platforms and strategic consolidation.
The tourism sector was fit as a fiddle, soaring high on the wings of the mass passion for exploring destinations while satiating the gypsy souls craving for liberation. And then came a pandemic!
Well, guess what? What was once deemed as a therapy to rejuvenate the weary spirits, was now itself in need of a therapy. Travel businesses were left circling the wagon to piece together the industry. And now, it appears as if the world is missing the exalted thrills that come wrapped up in the travel packages.
However, there is a ray of hope glimmering at the horizon already. Promising developments in the vaccine have escalated hopes for the travel sector grappling against the second wave of infection. Nevertheless, the pace of recovery remains an enigma as speculations are rife concerning which areas would be the first to take the centre stage during reboot.
However, despite a growing evidence that effective coronavirus vaccines may be available by 2020 or early 2021, Fitch Ratings recently indicated that global travel and tourism demand is expected to remain sluggish.
However, ASX-listed travel players are all as keen as mustard to push the developments. Let us explore some of the critical strategies that travel companies have been adopting to gear up their battered businesses.
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Dynamic Remodelling
Travel players tracing the radical shift in the operating environment have revamped the business model, enabling them to thrive in a challenging scenario. As the pandemic-struck business activities remained subdued for most companies, immediate remodelling was focussed on ensuring cost-effectiveness amidst remote work trends.
However, with the opening of Queensland-New South Wales border, airlines like Qantas Airways Limited (ASX: QAN) and Jetstar have been quick in revamping their operations. They launched several additional flights to be operational from 1 December 2020. Meanwhile, breaking the ice for pensive travellers is a major concern for the air carriers, that have come up with attractive discounts to get their business rolling.
Safety: The Top Priority
South Australia was recently gripped with similar paranoia, earlier witnessed across Victoria as COVID-19 cases linked to Parafield cluster in Adelaide’s north surged.
Amidst such rampant fear of pandemic outburst, Qantas Chief Executive Alan Joyce indicated that the airline is planning to make vaccination mandatory for all international travellers.
Meanwhile, the global airline body, International Air Transport Association (IATA), announced that it was advancing towards the development of a digitalised ‘Travel Pass’ to be launched early next year. It would offer necessary testing and vaccination information of the travellers, supporting international tourism.
While common grounds on vaccination remain vague, authorities and air carriers are more concentrated on testing to ensure safe travel.
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Technology to the Rescue!
The technological embrace has been quite a booster for the new normal in 2020. Meanwhile, travel players are also catching up to the trend as the situation renders better.
Australian mega travel agency, Flight Centre Travel Group Limited (ASX: FLT) focussed on productivity and revamping the operations, is also embracing technological platforms. The new AI tool rolled out by the Company promises to take detailed reporting and analytics to a whole new level.
While AI technology isn’t new to the industry, the innovative AI Reporting Tool from FCM Travel Solutions is a cutting-edge technology, empowering the client to identify and respond better to incidents. Meanwhile, FCM’s 4D Business Travel Consulting is another pioneering tool designed to maximise efficiencies and deliver insight to customers.
Strategic Collaborations in Corporate Travel
The border restriction imposed as an immediate measure to counter the pandemic wiped out early profits and organic growth of the travel and tourism players. In a bid to recoup the losses, travel groups have been stretching their capabilities through partnerships and trade deals with other companies.
The recent acquisition of Sydney-based travel technology company, Tramada Holdings by Corporate Travel Management Ltd (ASX: CTD) signals a shift towards consolidation in the Australian business travel space. Tramada Systems is a leading software solutions provider to travel businesses in Australia and New Zealand, offering automation of the travel booking process for the consultants.
Corporate Travel Management Group in late September also announced the acquisition of the US-based Travel and Transport Inc (T&T) including its Radius Travel business for AUD 274.5 million. T&T has a geographical footprint across North America and Europe.
Although tough times for tourism players seem far from over, a hustle and bustle in the travel landscape can be the harbinger of recovery process that has been picking up the steam. Meanwhile, the leisure tourists’ wanderlust and the consistent need of corporate travellers to put a face to a name can go a long way for travel sector in fast-tracking the revival of its dimmed glory.
Source: Kalkine Media
