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Travel Is Bouncing Back

Domestic passenger traffic improved to about 4.52 million in the first three weeks of August, up from 3.31 million, 1.91 million and 1.41 million passengers in the same period during July, June and May

An article in a leading travel portal shouted “Travel Is Bouncing Back Strong, and Airlines Are Racing to Keep Up”. Investment bank Morgan Stanley in a report predicted that Airlines in India will bounce back to 80% pre-Covid capacity in 2021. Remember, travel and hospitality were amongst the first segments to get impacted adversely by the deadly Covid-19 induced pandemic. 

Domestic passenger traffic improved to about 4.52 million in the first three weeks of August, up from 3.31 million, 1.91 million and 1.41 million passengers in the same period during July, June and May, respectively, according to data collated by aviation website Network Thoughts.

Air traffic in the same period during February, March and April stood at 5.73 million, 5.30 million and 4.40 million passengers, respectively, the website stated.

The analysis and statistics as above points to one big reality, “Human nature opposes being caged”. We are free spirits. Setbacks, situations etc can create a temporary pause, worse, get us to go into our shell; however, these are all temporary in nature. We crave to come back to normalcy. Normalcy, where we explore, discover, socialise, and build. We are human beings, after all

The statistics post 1st wave and subsequently post the 2nd wave clearly indicate that people in general by their own decision were swarming every possible getaway location. Goa, Rajasthan, Himachal, Uttarakhand were struggling to handle the mad rush of people who wanted to be normal.

Business travel is a different animal. There is a purpose behind this travel, and it is certainly not to let out steam. The purpose here is driven by the need to grow and the need to build. It is not an individual alone who decides this action, it is always a combined decision by the business and the market scenario and very less about the traveller himself.

In India over 60% of the companies are in the MSME space and they cumulatively contribute to over 30% of the GDP. Add to this, the highly buoyant start-up ecosystem and we have a big segment of businesses in India that cannot afford to be confined.

The recent industry numbers indicate a recovery of around 30% between Jul’20-Feb’21, post the 1st wave. The 2nd wave recover was more aggressive at over 40% between May’21 to Aug’21. These recovery trends clearly indicate the pent-up demand. The demand to make up for the lost time.

The temporary pause in business travel can be reasoned as below.

This pandemic brought out in the open, an urgent need to control costs. If revenues are beyond control at least the costs should be within reign. This urgency to rein in costs while ensuring business continuity, has prompted most companies to take the below actions:

  • Encourage work for home for backend functions
  • Curtail non-essential travel
  • Reduce the office maintenance cost, per employee
  • Prune employee count to optimise

The above actions are valid and just. Business have lost many months of revenues, thus leaving no choice, but to curtail non- essential expenses. 

This will continue till they reach the tipping point. The tipping point is, where they have made up for the lost opportunity and now is ready to scale. This tipping point can vary with different businesses. Companies with large cost structure might take longer to reach here. Hungry and funded to grow companies will accelerate to the tipping point.

Sales, relationships and interactions set stage for growth. These are necessities that can be temporarily pushed out but not eliminated. If the economy must grow, so do businesses that power it.

Businesses wants to ensure employee safety; it also wants to ensure growth for the company. The fact that majority of India is vaccinated with the 1st dose and a significant corporate man force is vaccinated completely gives confidence to businesses to reset normalcy. Customer locations are opening up too, as offices are opening up for business.

Overall, the sentiment is upbeat the economic indicators are pointing north. Normalcy is cautiously returning and so is travel.

French philosopher Gabriel Marcel defined the human nature to move around as “Homo Viator,” which means a person who travels. There is no reason why travel will not bounce back with that, I rest my case.

Source: Business World

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