Travel is one of those industries that will change forever never to return to anything like what it used to be.
For most people when they think travel, they think of taking a vacation at a beach or mountain destination. A large portion of travel is a result of business travel. It is another thing that this does not contribute a great deal to the turnover or the bottom line of companies since businesses find a way to negotiate cheaper rates. The global travel and tourism industry is estimated at USD 9.25 Trillion according to Statista. There are several components of this massive industry that employs 100s of Millions of people.
I foresee a drastic decline in business travel once COVID ends. With the increasing use of video calls and work from home norms, the need to meet in person will reduce significantly. This will also be seen as a source of cost savings by many companies. This will, in turn, hurt certain components of this well-oiled machine in a big way.
Once people have been used to making calls and getting work done from home would they see a point in travelling? Most business travellers end up with red-eye flights and punishing travel schedules. Not to mention time away from home and family. I have undertaken full days trips often to get a couple of meeting done. The rest of the time spent was often spent commuting within the city. If there is a possibility to get on a video call and finish it, why should I waste 20 hours?
A decline in business travel will affect airlines as well as city hotels which are great beneficiaries of this kind of travel.
At the same time, a lot of business travel is also undertaken to attend meetings, conferences and exhibitions. I do not know how much of this will get back to normal levels after this pandemic passes.
Is there a possibility to create a digital experience which could reach even more people and help exhibitors find more audience? Can the Car-Expo be done online? Saves a lot of logistical costs and the companies might be able to provide a better understanding of its capabilities from their factory.
Is there another way to replicate the experience of a conference – virtually? Would it be possible to enable better engagement between people with a lot of contextual information about a person made available rather than just running into a stranger and discovering them? Would we lose the serendipity or can we enable it online?
The JW Marriott in Bangalore has already started food delivery because traffic is unlikely to return in the short term. But their requirements are quite stringiest with a high bill value and 6-hour advance order.
Though in the short term this would be reduced to quite an extent, I expect personal travel and vacations to come back up. In fact, in a work from home reality, might it be possible for your spend a week at a resort and still put in the 8 hours that you need to?
Countries like Thailand and Indonesia are already pitching themselves as safe destinations with low Coronavirus cases and also cheap destinations where westerners can come live and work from. All you need is good internet access. This would be in continuation with the disruption of real estate, where alternate forms of real estate stand to gain.
The upshot of more work from home would be much-reduced traffic on the roads and lower commute times. This will perhaps increase the car ownership considering most of those who gave up cars did not want to drive for 2 hours at a stretch.
Ride-hailing services have already started raising their prices to be more profitable rather than be seeking new customers. These services will find it hard to get back to similar levels that they were at pre-COVID. The exodus of drivers who had come from other cities to make a living would leave the driver pool much smaller. A greater number of people working from home implies lower demand. Also, the increase in price would result in fewer people using the services. By extension, all of the bike-sharing businesses will also have it tough going forward.
Would airport retail be as valuable if not as many people are flying? Would the business model and income potential of airports themselves need revision?
Every piece of this economic puzzle will struggle to rise back up. Perhaps a new model will emerge changing