Do you ever have this weird nightmare that the entire world is stricken by a global pandemic, the stock market crashes and entire cities are locked down and you want to go out but you can’t even if you want to because you don’t want to potentially infect your parents so you just remain sad, lonely and anxious with your own thoughts and try to work from home to create an illusion for yourself that things are normal and then you wake up and remember… that’s just reality now.
Yeah, me too.
I am sure you are up to date with all the COVID-19 coronavirus news and know the number of cases everywhere. I hope you’re taking all the necessary precautions and are practicing social distancing. But I also know that there are hundreds of questions in your brain right now — what’s gonna happen to my travel plans to Europe? Is the travel industry still making money?
Impact of COVID-19 coronavirus on travel and tourism industry? What happens to the economy if everyone stays home?
It gets better, Are we going to make it to 2021?
I can’t answer all the questions, but I will try to answer a few to put your mind at a little ease.
How coronavirus could affect the travel and tourism industry?
Coronavirus and the travel industry
So when you talk about a business making profit you know that the supply and demand need to go hand in hand. And after the pandemic struck the demand for travel has gone down drastically. With the state and international borders of most countries being locked down, it’s a no brainer to guess that the travel industry, be it — flights, railways, hotels or tourism isn’t going to get new customers for the upcoming months. But that’s the simplest thing to deduce. What about the people employed in these sectors?
Global Economy hit by coronavirus. Booking cancellations acceptedJ
Currently the tourism industry contributes up to 10% of the global GDP. It employs up to 50 million people globally, and all of them are right now in a slump. The current predictions say that the lock downs can last up to 3 months but still the industry can take up to 10 months to recover. About 30 million of the currently employed people may lose their jobs, which will create a huge effect on the global economy.
Next, answering a big question — what happens when you already made plans for April and now you have to call it off? Unfortunately, most travel insurances don’t cover the reason of trips being cancelled due to a “global pandemic”, but you might have better chances of claiming your insurance if you intended to travel to or are currently in a country with coronavirus outbreak.
Most flights across the world have adopted to one of the three policies —
If you booked a flight before 10th March, 2020 for anytime between 11th March to 30th April and your flight was cancelled, you can opt for a full refund (Dates may vary for different flights).
Most airlines have also waived off their cancellation fee. Another option airlines are providing is to cancel your booking and retrieve travel credit of the same value. This travel credit can be used to book another flight from September 2020 to December 2021.
The last option is the waive of change/reroute fee. This option allows you to make a one time change to your booking dates free of cost.
You see, both you and the airline industry is going to suffer from loss in this case, but these policies help optimize the losses incurred on both sides.
How about the hotel bookings and Hospitality sector after hit by Corona?
Unlike flights, hotels usually do not take all the payment in advance. Bigger chains of hotels such as Radisson, Four Seasons and Sheraton are offering free cancellations until 30th April, 2020. Other hotels are levying upto a 10–15% charge on the booking fee.
AirBnb also modified their policy for cancellation for all bookings upto 14th April, 2020. If a guest cancels they will receive a full refund and, the hosts can cancel without charge or impact on their Superhost status.
Coronavirus – Affects Travellers, Foreigners and Travelling visa!
Most countries have now suspended visas till 30th April 2020 but there’s quite little information on how this is going to work. Italy announced a few days ago that anyone with a Schengen visa valid from February 1st to June 30th 2020, which they received from the Italian Embassy in Armenia, can re-apply for a new visa. To be eligible, the Schengen visa has to be unused and you must not have asked for a refund of your trip. Upcoming visa interviews have also been rescheduled in most countries. The governments will most likely allow change of dates on visas. We should be hearing more on this in the upcoming days.
Impacts all startups from tourism and travel industry
The next affected set of people are travel startups from the tourism industry. Most travel startups act as a facilitator between flights, visas, hotels and the customers. All these startups have now found themselves in a huge revenue crunch. As more and more customers are looking forward to cancellations they now have to drive at full gear towards improving their customer support. At this time, the only way they can manage to stay afloat is to help customers with a smooth cancellation experience and ensuring that they will come back to their platform again. Some of them are issuing gift cards or credits which will ensure that the customers will look forward to their platform again once this is over.
I know you didn’t expect your dream trip to Italy will be cancelled by a global outbreak of a virus but we will get through this. The whole world is at a halt right now! Experts predict that the global tourism industry will incur a loss up to $1 trillion, about a loss of Rs 200 crore for the Indian tourism industry.
Surely it will take time for the world to come out of this pandemic, I hope I have answered some of the questions running through your mind. Until then, stay home, stay safe and please wash your hands! 🙂
Check out Impact of Corona virus on tourism industry.
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