The once-revered travel benefits and coupons became as useful as a chocolate teapot, immediately after border closures came into effect this year. The year 2020 has been a nightmare for globetrotters and travel companies alike, credits to COVID-19. While there had been many instances in the past that put travel businesses out of tune, an upheaval of this magnitude is unprecedented, at least for the last 100 years or so.
Australian travel landscape did not escape COVID-19 induced unnerving moments. Be it huge employee layoffs, negligible business income or several companies like giant Virgin Airlines going bankrupt- the country witnessed it all.
But times are changing!
Australian travel sector survived all odds and is on the road to recovery as recent developments pan out in favour of travel resumptions. While domestic travel in Australia has already hit the ground running, it appears that the reboot of international travel is not too far off.
In this backdrop, let us explore a few exciting events serving as a beacon of hope for international tourism.
Improving Pandemic Situation
The global pandemic scenario, which undoubtedly was the root cause of the travel industry ailments, has shown several signs of improvements. Australia appears to be riding out the storm on the back of several necessary implementations.
The outcomes have been fruitful, with Victoria, once the COVID-19 epicentre has reported an infection-free period for over a month. Meanwhile, NSW and South Australia are suggesting optimistic patterns, as expectations of free travel by Christmas rides high. Amidst the improving situation, authorities are mulling over international travel resumption in a subsequent phase of recovery.
Arrival of International Students
For the first time since Australia shut down its borders in late March 2020, international students finally arrived in the country. In a pilot programme focused on boosting the Australian education industry, a flight from Singapore carrying a batch of over 60 international students landed in the northern city of Darwin. Students will spend 14 days in the Howard Springs quarantine facility after being directly transferred from the airport.
Kalkine Group Image (Data Source: Australia Trade and Development Commission)
The Australian Government has often indicated that its priority remains on getting its citizens back home, before engaging with international students. However, the Government remains in discussion with all jurisdictions to ensure that international students enrolled in Australia (or wanting to) are back, safe, and secure.
Notably, education contributing largest towards Australia’s service export sector is vital to drum the economic reboot, which continues to remain a critical challenge for the nation.
Expanding Travel Bubbles
Australia kickstarted its one-sided travel bubble with New Zealand a few weeks ago. As per current norms, travelers arriving in Australia from New Zealand do not require to stay in quarantine. Meanwhile, Australia remains in a bid to revive travel between both the nations by Christmas and is pushing two-way bubble between the trans-Tasmanian countries.
Furthermore, current deliberations with several Asian countries that have been successful in tackling the pandemic is expected to rekindle Australian travel space.
ASX Travel Stocks
The announcement of BioNTech and Pfizer vaccines could be a tipping point for ASX-listed travel stocks as authorities’ eye ‘Vaccination passport’ as an instrument to resume international travel.
Market participants regard the anticipated vaccine development to bring a positive outlook for tourism. Webjet Limited (ASX:WEB) shares exhibited a return of 65% in November, with its share price edging up from $3.49 on October-end to $5.77 on 30 November 2020.
Qantas Airways Limited (ASX:QAN) has delivered returns of ~28% in the past one month, closing at $5.38 on the last trading day of November. Sydney Airport (ASX:SYD) also posted a return of 23% for November. SYD stock traded at $6.71 on 30 November 2020.
COVID-19 pandemic has not only smothered the free-will of travel by forcing travel restrictions but also repressed the revival ability of the companies by parallelly inducing economic crunch.
Notwithstanding several trials and tribulations, the industry is ready to get back in shape as glimmers of hope promise new dawn for the sector.
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