WATCH OUT FOR THE TIPPING POINT

A perfect storm continues to ravage the travel industry and consumer confidence is at an all-time low. Airlines and airports are having to reassess the size of operations in the face of a slow and difficult recovery that could take up to two years to return to pre-covid-19 traffic levels.

This, coupled with low demand, initially saw high fares on popular routes. Now supply is starting to open up and airlines are trying to stimulate demand, fares are stabilising on popular routes and we're seeing extremely low fares on other routes.

I see lower airfares continuing in the short and medium term as low fuel prices, excess capacity and weak demand prevail. A tipping point will happen and we will see an upswing in traveller confidence, brought about by a reduction in travel restrictions, a vaccine or when testing is the norm. Then we might see air fares rise.

Hotel prices, meanwhile, have varied depending on location and facilities, with rates in some European cities dropping up to 35%. Hotels were swift to reduce operational costs and will further look to reduce distribution costs to negate the new expense of making the hotel experience touchless and safe. Hotels have looked to their local markets and taken advantage of the staycation trend to buffer a dramatic decline in occupancy, which is helping to stabilise prices.

Edel Doherty, CEO and Founder of Beyond Business Travel, a Focus Travel Partnership partner