The year 2020 will be remembered as the worst year for travel and tourism industry in the coming years. The COVID-19 pandemic brought down the industry to a sudden halt. International borders remain closed since March 2020. There had been a total lockdown in countries across the globe. Airlines, airports, hotels, cruiseliners, theme and amusement parks were shut to minimize the impact of COVID -19. With vaccine for the pandemic coming up, there is a hope across the industry that 2021 should be a better year. Experts of the industry are of the opinion that it will take 3-5 years for industry to come back to normal. T3 carries here the opinions of some experts of the industry.
Deep Kalra, Founder & Executive Chairman MakeMyTrip
“Travelling is innate to humans and having spent time indoors people are yearning to connect, explore and travel more than ever before. While COVID-19 had a crippling impact on the entire travel & tourism industry – the promise of effective vaccine rollout is good news as the year comes to a close. Revenge travel is going to gain further momentum as we enter 2021. The massive pent up demand is going to fuel that need to travel further with a lot of people yet to take their first flight or first real holiday. Even with multiple variables at play, we remain hopeful that we will see a total rebound much sooner rather than later.
There is an opportunity in every adversity, and we believe this crisis will help galvanize efforts to grow domestic tourism. With international travel remaining largely inaccessible to leisure travellers, domestic travel will continue to grow strong as more and more Indians look inwards to explore their own homeland. To seize the day, the government as well as the industry will need to rise to the challenge of transforming top Indian destinations as world class tourist attractions. This requires an integrated, inter-sectoral approach and investment from the government to build supporting infrastructure while the industry should focus on innovation, stellar service and customer experience that will propel domestic tourism in India like never before.”
Dr Ankur Bhatia, Executive Director, Bird Group
It has been a tumultuous year for the hospitality industry. Even post lockdown when businesses began to reopen, hotels had to walk a tightrope as all protocols and safety measures needed to be in place to restart. The year is now ending, and the international scheduled air travel has not resumed yet. However, the hospitality industry has shown resilience and managed attracting decent occupancies offering best rates to domestic travelers and staycationers. The industry is focussed on contactless dining, gourmet deliveries and experiential travel.
October-December period, which is traditionally the peak season for Indian hospitality industry, was of course not as busy but hotels did decent revenue per room as there was pent-up demand among domestic travellers. Staycations and Drivecations emerged as strong trends for hotels. Luxury hotels witnessed demand for intimate weddings as well.
So while there have been green shoots of recovery, the industry continues to grapple with a weak demand and high costs. There hasn’t been any help from the government, but we are hoping that in the Budget in New Year the government will not give short shrift to the sector that employs millions.
With vaccine now almost here, we are hoping that the sector will revive in 2021 but that also depends how soon international travel starts and domestic airline capacity returns to pre-Covid levels. It’s important that the international flights resume as most of the countries around the world have a defined quarantine procedures and passengers can decide accordingly. Since international travel hasn’t started travel and hospitality sector continues to suffer.
Indeed 2020 will go down the annals of aviation history as the watershed year for all the wrong reasons. Airlines bled with losses mounting crores per day. Allied industries such as airports, hospitality and travel trade have been hit hard as well. Thousands of travel agents have shut shop and many have been rendered jobless. While India continues to operate Vande Bharat flights, scheduled international flights are still not operating and the situation continues to look grim for the sector.
Hopefully the government will look into this and start international flights at least to countries where we have current air bubble arrangement. . Normal Pre Covid Civil Aviation rules and norms should be reinstated now as Each country has defined its quarantine procedures and it should be left completely to the passengers who would like to travel
Sarbendra Sarkar, Founder & Managing Director, Cygnett Hotels & Resorts
It's been a year of absolute chaos for the hospitality industry, but we braved through the storm and survived. This pandemic has really pushed the entire industry to innovate, transform, and rethink how we do business. With the holiday season here, our hotels are running busy. We've even created specialized experiences, events, and holiday menus. We are excited that domestic leisure travel is picking up pace. We have re-opened 16 properties and all our leisure destinations are doing good business. We have received a large number of reservation requests for the new-year weekend!
However, with Work from Home imposed by most organizations MICE and corporate events will take a while to revive... with the vaccine already introduced this should pick up by mid-2021.
Abhinash Manghani, Chief Executive Officer, WelcomHeritage
The year 2020 has been a challenging year for the hospitality industry but we have faced the challenges with dignity, courage and hopes. At WelcomHeritage, we utilised the lockdown time to develop new strategies to attract travellers and introduced new technologies in our working environment. We adopted a proactive approach and introduced various innovative packages like 'Work from Home’ packages, ‘Drivable Holidays’, Staycation packages etc, to suit the requirement of different types of travellers. To tap the burgeoning domestic travel market, we also partnered with leading airlines - ‘Indigo' and introduced special packages for their clients. Furthermore, WelcomHeritage collaborated with the leading travel companies Thomas Cook and SOTC, to offer special packages for their customers across India. We have seen a growth of approximately 50% in occupancy month-on-month in the second half of the year, especially during long weekends in August and Diwali. Since the lockdown has been lifted, the queries received at our Guest Experience Centre have almost doubled. Many of our properties were completely sold out during long weekends. For this upcoming festive season, most of our properties are at nearly 80% occupancy, which is very encouraging. We have high expectations from 2021 and we have started preparing for the upcoming holiday season as well. We are also working on new business strategies to tap the burgeoning domestic market that is looking for relaxing and safe holidays and, here WelcomHeritage can be the best option. Our properties’ USP is their location which offers natural social distancing, greener environment and huge spaces, thus naturally adhering to Covid-safe environment. In 2021, we will also be adding new properties in our existing portfolio and we hope that 2021 will be a fruitful year not only for us but the entire hospitality industry.
Sean Hunter, CIO, OakNorth
When it comes to commercial lending, banks rely on risk models to make decisions. These models have been built up internally over decades of lending across thousands, if not tens of thousands of loans, but COVID-19 has exposed unexpected flaws in them. For example, these models are based on historic data which doesn’t adequately reflect the unique situation we now find ourselves in or take into account the future challenges that the world will be facing as it enters into the worst recession in three centuries. They also make broad assumptions about entire sectors rather than developing an understanding of the portfolio at the granular loan level and taking into account the individuality of each business.
I believe the only way to course-correct for “the new normal” is to take a fundamentally different approach to commercial lending than what’s been done for decades, and technology will be central to this.
In the future, banks are going to have to combine backward-looking data with a forward-look view, as well as take a granular, loan-by-loan approach rather than an overall portfolio or sector-level approach to credit analysis. They are also going to have to conduct reviews on an ongoing basis, rather than annually; update parameters to reflect the ever-changing situation; and use alternative data such as foot traffic to inform their models.