Tests and checks threaten the travel industry's near future

It is dawning on governments, business, and individuals that the pandemic is far from over, and one of the hardest hit industries, travel, weighs the impact of measures for several years yet.

Why it matters

The world remains far away from the easy travel arrangements of 2019. Testing ahead of travel is set to continue beyond next year, which will likely cause a drag on demand – since pre-travel testing is private and expensive especially compared to low-cost carrier prices – while inconsistencies between territories adds further confusion.

Travel brands will have to think about spurring demand, making the process easy, and baking flexibility into their offer for years to come.

What’s happening

Around the world, signals that 2022 will be smoother than the first two years of the pandemic are fading fast.

• In the UK, the FT reports that the government has engaged consultancies to extend the COVID-19 test and trace system and monitoring of travel potentially up to 2025.
• In response to the new, apparently highly-contagious Omicron variant, additional testing measures ahead of travel have hit the aviation industry hard with representatives warning of “permanent scarring”.

But it’s through deeper trends the impact of the pandemic will be seen, specifically in the lucrative business travel segment that is likely to remain depressed into the next year, warns the Economist Intelligence Unit’s (EIU) Industries in 2022 report.

• A hit to business travel is not just the result of COVID-19 risk, the EIU states, but also a growing awareness around a company’s climate impact that reduced air travel can significantly decrease.
• International tourism is adapting to vaccine passports and other health certification, but the lack of interoperability is a real drag.

Sourced from the Financial Times, Economist Intelligence Unit