People ‘again reluctant to travel’ – travel agent association president

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People are once again reluctant to travel given the rise in Covid-19 cases, President of the Federated Association of Travel and Tourism Agents Iain Tonna told this newsroom.

Tonna was contacted to provide an overview of the situation in his industry since the airport reopened last July, given that a number of mass events were recently cancelled due to the rising number of Covid-19 cases.

He described the outbound travel industry as “slowly limping along”. 

“With the recent rise in Covid-19 cases, apprehension has once again hit the market, so we are seeing people being reluctant to travel.”

“Even though there is no lockdown or anything like that, in terms of appetite for travel we are probably back to square one.”

Asked specifically whether the cancellation of the international parties has resulted in a decrease in inbound travel, or cancellations by tourists, he said: “in general I don’t think we have seen any reduction that can be attributed to the cancellation of parties. If you speak with those who were handling the particular events directly then the answer would be different, but overall we haven’t noticed a reduction in bookings because of it.”

He did say, however, that “the Covid-19 numbers have put us back in the spot light, and we have already seen quarantines introduced for people travelling from Malta in certain countries. We are waiting with bated breath that our major source markets – the UK, Germany Italy and France – will hopefully not follow suit, as that is when we will see significant changes in the pattern.”

Asked for the percentage difference in terms of travellers when compared to the same period last year, Tonna said that July probably ran at around 20%-25% when compared to July 2019. “The prediction is that August might be a bit better. For the first 15 days in July flights were only available to and from certain countries, with the larger source markets being included in the safe corridor list in the second half of the month. August will hopefully be a full month with open corridors between these destinations.”

“We are always conscious of the main source markets – the UK, France, Germany and Italy. Obviously all other markets do impact, however those four account for a big chunk of our tourism. This month we will probably be looking at around 35% to 40% of the amount (of tourists) we saw in August 2019.”

Tonna spoke about the current government aid for the industry, citing that they still fall under schedule A of the Covid-19 wage support scheme. “The scheme is confirmed up until September” he said, but added that they are in discussions with the government to extend this support scheme. “It is going to be a long winter for us.”

Aside from this, he said, “we are looking for different kinds of support in different sectors. For example, in the case of destination management companies, which are companies that try to attract conferences to Malta for example, there is a specific task force working with the government to see how to incentivise companies to consider Malta as their destination of choice. That will be a medium-term aim, as I do not think we will see any meaningful recovery before next spring in this sector.”

In terms of the outbound sector, he highlighted that FATTA has been in talks with the government to seek support for travel and tourism agencies to refund customers whose holidays were cancelled.

“We need support to refund customers as it is taking time for us to get the refunds from the companies themselves.”

 Asked if there has been any movement on this front, he said that it has been going ‘hot and cold’ repeatedly. 

“At the moment we are still talking. We are looking at what other EU countries are doing and trying to work with the government to see if we can adopt one of the schemes that was implemented in other European countries.”

“The Package Travel Directive specifies that when a customer books a package through a travel agency or tour operator, and if that operator is unable to perform the service, then the operator is obliged to refund the customer in full. The complication is that for many services we would have contracted with airlines, hotels abroad etc and would have paid them in advance. So we can only refund the customers when we get the refunds back from those suppliers. In the normal course of business you would refund the client before you yourself get the refund as it works within your cashflow. But in this particular situation, where we have been at a standstill with nearly zero revenue from mid-March only starting to trickle in now, when compared to the number of cancellations and therefore the amount in refunds that need to be handed over, there is a gap.”

“We are in talks with the government over possible schemes to provide state aid to help us bridge the gap between our obligation to refund the customers, with us actually getting the refunds back from suppliers, as it is taking suppliers a long time to get the money to the travel agents.”

Turning to the current tourism market, he said that the conference market is practically frozen. “What we are seeing at the moment is some people looking at picking up their packages which had been cancelled during the lockdown period and are availing themselves of them now, in terms of outgoing travellers.”

“In terms of incoming travellers, it is mostly individuals or families. We have not really seen the leisure group business come back yet. To be fair July and august is a slow season for leisure groups, which normally picks up in September or October. I am referring here to groups of 25 or 30.” Currently, the majority of tourists coming to Malta are aged 18-35.