It’s been a grim few months for the aviation industry.
First the volcanic ash cloud descended over Europe from Iceland, closing airspace for six days and causing travel disruption for thousands of people. Now a series of British Airways strikes threatens to put the nail in the coffin of any hope of a summer revival in international travel.
It couldn’t have come at a worse time for a sector that has already seen several airlines going bust during the recession, and is struggling to recoup the rocketing cost of jet fuel.
Figures show global airline traffic fell 2.4% in April, with flights on European carriers dropping nearly 12%, according to the International Air Transport Association. The group, which represents more than 240 airlines, places the blame firmly on the ash cloud.
“The ash crisis knocked back the global recovery – impacting carriers in all regions. Europe’s slow recovery from the global financial crisis and its currency crisis are already a huge burden on the profitability of its airlines, ” says Giovanni Bisignani, IATA’s Director General and CEO.
So as the airlines count their losses, it seems consumers are getting savvy, with a new trend for “flightless” holidays emerging. Email bulletins from travel companies are entitled “Beat the Ash Cloud” with offers on trips based closer to home, ferries, car hire or cruises.
In the UK, figures from the Office for National Statistics show that foreign travel by Britons went down by 9% in the first quarter of 2010 – and spending by domestic tourists increased. So perhaps the trend for stay-at-home tourism that began in the height of the credit crunch — the so-called “staycation” – is set to continue.
Peter Smith, a travel expert from Travelsupermarket.com, thinks so:
“Given the strikes, and the ash cloud, people don’t really know if they’re going to get away – or if they’ll get back home. That uncertainty means an increasing number of people are opting to stay closer to home for their holidays, booking cottages or hotels and opting for rail or car hire rather than flights.”
This view is supported by holiday firm Activity Breaks, which cites a 25% increase in enquiries for no-fly holiday packages. Commercial Manager Dearbhaile Mulholland says the trend means a more localised approach to travel:
“We’ve had a huge increase in demand for customers wanting packages that don’t involve flying. Customers are looking for places they can travel to easily overland – for example Italians are buying breaks in surrounding countries such as France, and more people in the UK are booking breaks in Scotland.”
It’s not just package holidays that are benefiting – hotels are seeing an increase in bookings too.
“Searches since the first airport closures in mid April have soared for UK destinations, with double digit growth for destinations including Bath, which is up 73% year on year, and Edinburgh which is up 42%,” says Alison Couper, the Global Communications Director of Hotels.com.
But Sarah Long, from Visit England, says it’s too soon to say what long-term effect this will have on the UK tourism industry. She also points out that a drop in flight bookings doesn’t necessarily result in any economic benefit:
“Clearly there’s a shift in attitudes in terms of people taking breaks at home, as happened last year with the credit crunch. Interestingly our research suggests many of those who did take a domestic holiday last year said they’d do so again, which may be a factor in why the trend is continuing.
“But it cuts both ways. Flight disruption means more Brits might holiday at home, but there’s also likely to be a drop in inbound passengers.”
Other external factors have also had a big effect on the drop off in international travel. The weak pound means British travellers are thinking of how their spending money will be affected when visiting Europe, and similarly those in the Eurozone will avoid going to the US due to the drop in the Euro against the dollar. The upcoming World Cup also means more people will be likely to stay in their home nations during June to see how their team fares. All this coupled with the darkening cloud of economic warnings predicting a return to global recession, and it’s not surprising that holidaymakers are going native.
The new UK government is also moving away from a focus on air travel – with both sides of the Conservative-Lib Dem coalition being opposed to airport expansion. And it’s likely to mean a boost for rail travellers, according to a spokesperson for the Department of Transport:
“As part of our plans to make Britain greener, we made it quite clear that we would not support additional runways at Heathrow or Stansted. Our focus is on improving the experience of passengers. A key element of this will be to provide good links to a high speed rail network.”
That’s a move welcomed by environmental campaigners. Greenpeace transport campaigner Anna Jones says:
“A high speed rail network will help the UK slash carbon emissions and hit our climate targets as an alternative to Heathrow’s third runway and other airport expansion plans around the country. The government is taking a first step towards creating a transport system fit for the 21st Century low-carbon economy.”
So with all these factors combined, will this really mean an end to our dependence on flying?
Peter Smith from Travelsupermarket.com doesn’t think so. He suggests this is just a temporary phase — and that people will return to flying:
“People will still want to go on holiday, and I don’t think this will stop anyone flying in the long term. The flight industry has been through this type of crisis before and has come through it. Flying is still the most efficient and convenient way to get where you want to go.”
Francesca Naish (28) from London is a frequent flyer – and says her attitude to flying hasn’t altered at all since the ash cloud.
“If I had been going away in April I might have investigated alternatives, but now I think I feel the same as pre-ash cloud. I’ll shortly be booking flights to Budapest.
“It all comes down to affordability. There are loads of promotions for UK breaks at the moment but I think people still like a foreign holiday. Some, of course, will be affected by the ash cloud or environmental concerns but I still think most people will opt for the cheapest mode of transport.”
And perhaps that’s the point. Foreign travel has become as accessible and affordable as taking a train or ferry in recent years, but it wasn’t always like this. Before the advent of budget airlines such as Easyjet or Ryanair, flying was seen as a mode of transport only available for the wealthy, or a luxury to be saved up for. With all the airlines now looking for ways to make back their losses, will there be a shift back to how things used to be – and will the customer have to take the hit?
Peter Smith believes the last few months could have a knock on effect on prices:
“In the short term we’re seeing huge bargains as agents try to shift their stock, with examples such as return flights to Spain for £25 and a week’s all-inclusive holiday for £250. But in the longer term, the airlines will have to recoup these losses somehow, so we will probably see more “hidden” fees introduced. More carriers will also start to act like budget airlines by charging for baggage or paying a fee if you don’t check in online.
“We’ll also see more mergers between airlines — such as between Iberia and BA or between the US carriers Continental and United Airlines — so they can pool resources and spread the costs.”