Commenting on the latest ONS overseas travel and tourism statistics: Ian Bell, head of travel and tourism at RSM, said ‘A drop of 73 per cent of inbound and outbound travel last year just reinforces the severity of the downturn for the travel sector; and the hoped for roadmap for recovery this Summer lacks the certainty that the industry needs.
‘As hopes for a strong summer season remain uncertain, travel operators need urgent action to open up travel corridors and lift restrictions to enable them to plan and prepare effectively.
‘This summer could be the last play for many operators that have used up reserves and taken on extra debt to ride out 2020. Without further support or capital injection, we could see major distress in the sector and a domino effect as significant failures have a ripple effect across the industry.
‘Even if operators survive another turbulent year, the looming output from the CAA consultation which looks to make changes to ATOL and financing requirements could still put the brakes on recovery. The plans will fundamentally change the financial model on which successful businesses have been built in the past and will strip out crucial working capital at a time when businesses are strapped for cash - suffocating the market further and reducing competition.
‘Demand for travel will come back, but without targeted support we could see unprecedented redundancies and business failures; and the Government needs to step in and act on calls from ABTA, to prevent acute business distress across the sector.’