There is little doubt that the travel industry has been one of the hardest-hit sectors of the global economy during the COVID-19 crisis. Tourism revenues worldwide have tanked, millions of jobs have been lost, and many small and medium-sized travel companies will end up going out of business.
The Jet Set
I will be appearing on WGN Radio from time to time to discuss the implications of the crisis for the travel industry. This is what I discussed in the most recent segment, which aired on April 19.
I should mention that Chicago's hotel industry in particular has been very proactive during the crisis. Working with Mayor Lori Lightfoot, the industry was the first in the nation to offer free rooms to first responders, medical staff, and citizens suffering from mild symptoms in need of a place to quarantine. Other cities quickly announced similar programs.
This has allowed some hotels to keep on workers. However, with the cancellation of all festivals for the rest of the year, and the likelihood that conventioneers won't be returning to Chicago anytime soon, things will continue to be dicey for the city's hotel industry through next spring (as winter in the Windy City is generally a very low season for hotel occupancy).
The Good'ish News
The Good'ish News
But let's consider some good news. When stay-in-place orders are lifted, there will be pent-up demand for traveling. However, in order to feel safe, with a modicum of control, people throughout the world will likely travel close to home for the foreseeable future. Expect plenty of road tripping, with visits to family and friends top of mind.
Visits to nearby state and national parks, and to rural areas, will also be of interest. Trips to crowded big cities and overseas destinations will be slower to come back. And the cruise industry....forget about it. The cruise industry will be the last sector to recover....with a caveat. I am talking about ships that carry hundreds if not thousands of passengers. River cruising and expedition cruising may recover more quickly.
The Jet Set
It's going to be awhile before travelers feel comfortable hopping on a crowded plane. The first groups that might be willing to take the risk are wellness seekers and luxury travelers. Certainly, the craving for wellness vacations during this age of uncertainty is going to be high. Travelers will not only be seeking vacations to boost their physical health, but to regain their mental health as well. Meanwhile, high net worth travelers will still have the money they need to afford luxuries like private jets and access to exclusive getaways and high-end accommodations that will allow them to get away from crowds.
There's no doubt that the next two years are going to be a slog for the travel industry. But there is opportunity for smaller players to attract a large pool of travelers by focusing on the regional market. Additionally, those destinations that can develop effective messaging and hone practices needed to inspire confidence in travelers may find themselves ahead of the comeback curve.