Hello and welcome to my latest Podcast!
When I travel, like many others, I pay my own way, I ask no favours or special treatment; I owe nothing to no one and ‘they’, whoever they may be, owe nothing to me. What you see is what you get, someone who has always enjoyed travelling, from a very young age, and someone who believes in fair play and justice in our daily consumer lives.
Imagine how I feel at this moment in time, when I read an ever decreasing number of newspaper or magazine articles on Consumer travel, because of the impact on our ability to get away. Those that do comment provide a frenzied look into far away destinations (because you might be able to travel there), but fail to realise that for the vast majority of the British Public, travelling such distances are beyond their pockets. Then there are those who unrealistically flash up the latest travel deals and cut prices, against the uncertainty found in many countries.
Some go as far to get themselves on that first flight and wizz around with great literary bravado, trying to persuade you perhaps that it is safe to fly, failing perhaps to realise that recent proclamations have been timely contradicted by a recent report from Eurosurveillance!
For me the issue is simple and it’s based around one word; pandemic!
The word connotes to the world at large that something is amiss and that we should take steps to stop this dreadful virus in its tracks.
I can assure you that this Travel Commentator, with the exception of days out and one long weekend staycation, that my passport has stayed firmly in its wallet.
If anyone reads, follows or act on what I say, I believe that it is important to them that I lead by example, so I’ve stayed at home.
Believe me, I am as frustrated as you, for I would rather be jetting, sailing or driving to new and exciting destinations, either on holiday or to complete some of my projects.
But it is what it is and we should all do what we can to control our Consumer impulses, not just for our benefit, but for everyone around us.
Now that is not to say that I don’t have great and sincere sympathy for the Travel Industry. Their lot is not a happy one, against the indifference of the UK government; it is leading, and I say this with deep regret, to many companies going out of business and many people will lose their jobs. Since February/March, I have had plenty to say about this in support of this Industry.
Regardless, I don’t see too much general commentary in favour of them and what I do see, fails to bring into the minds of their readers, the sense of panic and urgency to this problem; most journalistic articles are too busy fantasising about the travels to come!
In the same way, little is spoken about the plight of many holidaymakers and air passengers, still waiting for their refunds; I am one of them! Instead, we hear from people who should know better that no Consumer has been left behind, when the reality suggests otherwise.
In truth, my fellow travel commentators are all looking in the wrong direction; they are failing to read the runes, because that will tell them what we should expect to see in the future, thus developing their commentary on managing Consumer expectations.
The other day, the Director-General from EuroControl, the pan-European Air Traffic Control Centre, issued their projections about how quickly air travel could recover to its 2019 levels, if a vaccine was produced and made available. The results were in some ways surprising.
In their first scenario, they suggested that if a vaccine was available in 2021, then it would take until 2024 to achieve a full 2019 air traffic recovery.
In scenario two, they offered that if a vaccine is available by 2022, then 2019 full air traffic recovery level would not be achieved until 2026.
The third and final scenario suggested that if any vaccine produced and offered was proven not to be effective, then a recovery to 2019 levels of air traffic would not be achieved until 2029.
So the outlook toward a 2019 air traffic recovery, ranges from anywhere between 4 and 9 years!
Remember, airlines and aircraft manufacturers have already carried out their own analysis and acted accordingly. Since March 2020, airlines have taken whole fleets out of service with some aircraft types being retired. Airlines are also delaying deliveries of new aircraft and in many cases, actually cancelling orders for new aircraft.
When others have been looking to government, I have directed my gaze toward the airlines and general aviation industry. They are the barometer of travel; the same could be said for the cruise companies.
Into this mix, the news broke yesterday that a potential vaccine was producing protection from the virus of up to 90%. The excitement in the British press was more than palpable and perhaps not managing public expectations very well.
If you thought the mechanics and logistics of COVID19 was difficult, imagine trying to inoculate the world’s population; it is not going to be quick nor instantaneous?
If you excuse the pun, the Travel Industry will see this development as a shot in the arm; the panacea to all their ills. But recovery in travel will depend not just on how quickly the UK inoculates, twice it seems, most of the British Public, but also how quickly and safely other countries will do so.
An important thing to remember is this; Consumers will face a new barrier in this COVID-age. In my opinion, receiving countries will abandon the requirement for testing to secure entry, they will be looking for confirmation that you have been inoculated, twice! Borders will become depositories of proof and truth and unfortunately not trust!
We are all going to have to adapt!
But for UK Citizens, adaption also comes in the form of the glorious full Brexit to come. I have gone well past the point about ‘Leave’ or ‘Remain’, the issue is not now about the claims of a flawed democracy, it is about common sense and facing up to the reality to come.
Unfortunately, for many media outlets, when I privately speak with them about a ‘story’ up next, we sometimes touch on the ‘B’ word. When I speak with some producers, you can feel them shake and quiver in fear that you would say something that would upset their listeners. What have we done to ourselves I wonder?
With that said, I think its important to be realistic with Holidaymakers about their prospects in this post-Brexit/post-COVID world, so, Consumers should expect:
- Less choice, simply because of the reduced schedules that will be offered by airlines and travel companies;
- Less choice will mean that you may have to pay a higher premium:
- For example, with a family of 4, 2 adults, 2 children, booking a 2 week all-inclusive holiday to Spain and receiving a free child place, may have expected to pay around £2,000 for their holiday, prior to the EU Referendum in 2016;
- Key to the cost that Consumers will pay, is dependent on the rate of exchange between the £ and other currencies;
- After the vote in 2016, the value of the £ fell by around 20%, recovering to a level of 15% below a June 2016 value. However, as January 2021 approaches and the likelihood of a no-deal or an expected extremely weak deal, I would suggest that confidence in the £ will fall back to about 20% below the pre-Referendum level;
- This means that for this family of 4, they will have to pay an extra £400 for the same 2016 holiday, just based on currency fluctuations;
- Then there is the COVID premium, which let’s just say adds another 5% to the cost, adding another £120, delivering a bill to our family of £2,520;
- Our family will need spending money, so that they can buy treats and trips out from their all-inclusive hotel. Let’s assume that our family of 4 decided in 2016 that they would bring or allot £1,000 spending money either in cash or through a credit card. The fall in the £ means that they should logically cater for the fact that their money will buy less in their chosen destination, meaning that they should add 20% to their calculations, meaning that they will have to find an extra £200, meaning that their spending money will rise to £1,200. But, I would also suggest that they need to think about the potential for inflation in their destination, not unrealistic in the circumstances. I would factor in an extra 5% to account for this potential, meaning that our family would need to find another £60, meaning that they should carry with them, £1,260 for the holiday spenders!
- Then there’s the issue with Travel Insurance. This is because come 1 January 2021, the European Health Insurance Card will be no longer available to UK Citizens and the signs are that there will be no reciprocal agreement made for travelling health payments! Travel Insurance will be interesting to watch. I predict that we shall see 2 things happen; firstly an increase in premiums (maybe not at first, but as we go through 2021 and into 2022), probably rising by 10%. But the important issue in my opinion may come through changes to the excess you may have to pay. It is entirely possible, that you may be required to pay 10% or 20% of a medical bill, out of your own pocket, before the Insurance company will pay the rest!
- Let’s assume that our family of 4 were buying an annual policy for £100 in 2016, this would mean that the cost for the same policy could increase by £10, meaning that the same policy would now cost £110, but
- The really important issue is what would an excess cost to the family if one of them became seriously ill?
- If this is how the market is going to go, then in calculating an excess, we should consider the average cost of a medical treatment could be around €6,000. If we then assume that the excess is set at 15% of the cost of the medical bill, this would mean that our family would have to pay €900 at the hospital or medical centre, before the Insurance Company would pay the rest;
- There are those listening who might say, well I’ll cut my costs by not having Travel Insurance. Be sensible! You would then have to pay the €6,000 and if there are repatriation costs, you would have to pay those, meaning that could be many thousands of £’s out of pocket; you really have no logical choice but to protect yourself and your family by taking out comprehensive Travel Insurance!
- Our family will also lose their rights to watch their favourite films through their subscription service (that’s your geo-locating rights applied to services when you travel within the EU). In addition, it looks like our family won’t be able to rely on roaming and may face extra charges for using internet, texting or making calls from their mobile; let’s conservatively call that £50 extra for their 2 week holiday!
- So, by my estimation, our family of 4 are going to have to budget an extra £840 on top of the original cost of the holiday, spending money and travel insurance. And heaven forbid that one of them should become ill and are faced with an excess to add to their burdens!
- The issues of finance almost pale into significance the real prospect that, they will face airport border entry queues (with their young children), unless of course they pay extra for fast-lane passage!
- Whereas once before our family enjoyed being able to bring back virtually unlimited drink & other products, having paid local taxes, they are now facing the possibility of the return of Duty Free Limits - operating both ways - with a consequent tax on any excess they carry;
- And on top of this, there is COVID and a vaccine - and I have no doubt the UK government will look to the private sector to deliver inoculations, quite possibly at a price to the UK Holidaymaker. If you think I’m wrong, who do you think pays for the testing now being carried out at UK Airports - here’s the clue - it’s not the taxpayer!
Who said Travel was easy?
These are the issues that face ordinary families throughout the land and yet media dialogue is sparse, uninformed and fails to concentrate on the things that matter to ordinary Consumers.
It may be that Consumers are exhausted or fatigued by everything that has happened since 2016, but in all honesty, Consumers need to wise up and recognise that these important issues affect not just how they live their lives, but how it will affect their pockets.
I for one look forward to the return to ‘normal’, but I think that a great many people do not yet realise that the ‘normal’ of the future is not that of the past. We are all on an important journey, and we haven’t even left the comfort of our own homes yet!
Until the next time
(This is the script for Frank's CreatingRipples™ Podcast - Brexit, Disease & Travel Commentators. You can listen to Frank's Podcast here. Please note that the content, unless otherwise stated, is the copyright of Frank Brehany © 2020)