The travel industry is hiding its head in the sand over how deep the economic downturn is likely to be, a senior figure has warned this week.
Responding to questions from the floor at Travolution’s Question Time Hoseasons’ chief executive Richard Carrick said the recession would be deeper than most were anticipating.
“The difference between this and previous cycles is that in the past events have affected people’s willingness to travel but this recession will affect people’s ability.
Consumer confidence is shot to pieces and every single indicator is heading the wrong way.”
Carrick added that the level of complacency surprised him with people believing that the holiday would be the last thing to go.
“If you look at the last few years people have been taking three, four and five holidays. There is no way that is going to happen. There is the possibility of a million more people entering the job market and there is a hunkering down mentality with people staying closer to home.”
Other panellists agreed there would be a tightening of purse strings.
Kayak UK and Europe managing director Faisal Galaria said: “At a macro level what worries me is the capacity we have to print money, which will lead to inflation and at the same time the job market is tightening.”
STA director Dick Porter predicted a ‘massive clean out’ in terms of consolidation and failures particularly within the airline sector. He added that opportunities would also be created.
Google head of travel Daniel Robb said tour operators had taken the right steps in terms of reducing capacity but a questionmark remains over how far demand will fall.
He also said online spending levels where holding up with no major cutbacks but that there was a general drive for efficiency.
“Peter Long has been talking about getting his house in order and the feeling that at this time attention to detail is paramount within marketing strategy.”