While many business sectors have been terribly hard it by the COVID-19 pandemic, one that has been particularly badly being the travel agency business, with their core “stock in trade” international travel, banned rather like a hard drug is banned and cannot be sold, neither can international travel.
I have watched all the very plausible efforts made, especially by AFTA to secure $250m financial support for agents to help them get through, but it appears it has all been to no avail with no funds forthcoming from the government, other than that available for other industries, with the net effect that hundreds of agencies have closed down, many thousands of staff laid off, agents putting their businesses on hold and others barely survive.
I just wonder whether anyone in Canberra really listening to AFTA as time is marching, with the whole sector collapsing, with the relatively few survivors waiting with bated breath for international travel to be opened up, with in the interim desperately trying to sell domestic holidays.
One thing is for certain that the travellers stranded overseas or those that have had holidays cancelled have learnt the lesson of having an agent on side, with no doubt that repatriation and refunds were made much easier with an agent on side.
AFTA Chairman Tom Manwaring, who is CEO of Express Travel Group, is quoted by the ABC as saying he and AFTA have called on the Federal Government to provide the sector with a $250 million support package for 4,000 travel agencies and the 40,000 Australians they employ based on the contribution of $28 billion plus each year to the economy, adding, “Without a tailored support package, businesses will start closing,” estimating at least 25% of the sector will close, meaning job losses and more. But I wonder if anyone in Canberra is listening and I would have to say to Tom that sadly, it does not appear so as his appeals have now been going on for months, with no success.
Flight Centre chief executive Graham Turner has been quoted again by the ABC as saying Flight Centre will not hit pre-COVID earning levels until 2025, but could break even by 2021-22 financial year, adding, “We started pre-COVID with about 21,000 people employees internationally and we are down to 6,500-7,000 at the moment.”
He said, “We’ve kept our best locations and frontline people so that we can cope with a fair bit of businesspeople coming back”, but he thinks it won’t be until June 2025 where their earnings lift to pre-COVID levels.
He says, “We will have a significant loss this financial year and it will be the year after, 2021-22, when we should make a small profit or break even that year, but he says with interstate travel still largely restricted and COVID infections in North America and Europe, “it is going to take a bit of time to get back to any level of serious normality”, adding, “International [travel] we believe will start returning in the next six months, it will be generally bilateral arrangements, places like Japan, South Korea, perhaps China, Japan and New Zealand of course.”
With Turner saying his view is that we need to learn to live with the virus until a vaccine is successful, “by controlling and supressing, not eliminating”, with which I agree, he says, “By June/July we will see much more travel coming back and will have much better protocols to protect people both before and after [getting on the plane], so the risk of travelling will be very low of either catching it on a plane or spreading it once people arrive here.”
Regardless, in the meantime the tills are not ringing and the credit card machines are not swiping with the outlook bleak for travel agents, with Turner concurring that “A lot of small businesses in travel and tourism are really going to suffer over this next period, if they indeed survive,”
In the meantime, what is the government saying?
Well, it appears nothing except the promises that the Chair and CEO of AFTA have had as they left Canberra that the government would look into it, but no real action, with in the meantime the clock ticks on, as the travel agency sector continues to collapse, with the words Nero, fiddling and Rome burning sadly coming to my mind.
A report by John Alwyn-Jones
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I’ve been running my travel agency for 33 years . It’s my passion and my livelihood. We have faced many onslaughts over the years but this one is Armageddon.
I fear even if we survive that the industry will cut commissions as the suppliers have also suffered greatly.
It’s so sad.
CDM Travel