Travel Industry Braces for Impact as UK Considers Hotel Quarantine for International Arrivals

Strategic Insights -

As the UK prepares to introduce tighter immigration rules and mandatory hotel quarantine for inbound passengers, the travel industry is sounding the alarm about the devastating impact on consumer confidence and summer holiday bookings. Shares in European airlines have already taken a hit, with British Airways owner IAG plummeting 7.7% and easyJet dropping 6.7%. Travel groups, already reeling from national lockdowns and closed borders, warn that additional measures could be the final straw.

Key Takeaways:

  • The UK's consideration of hotel quarantine for international arrivals has sent a shudder through the travel industry, with shares in European airlines plummeting by 7.7% (British Airways owner IAG) to 6.7% (easyJet).
  • Travel groups, such as American Express Global Business Travel and Tours International, are warning that additional measures could be catastrophic for consumer confidence and summer holiday bookings.
  • The travel industry has been careful not to criticize public health measures but has called for a pathway out of restrictions in time for the peak season.
  • Tens of thousands of jobs and billions in lost trade are at stake, and industry associations, such as Airlines UK, are calling for a road map out of restrictions as soon as possible.
  • Hotels run by national chains, such as Carnival, are being asked by the government to make rooms available for arrivals to quarantine for 10 days, with travelers picking up the cost.
  • Travel companies, such as Tours International, have seen significant revenue losses, with the company taking £1.4m in revenues in 2019 but no money since March.

Statistics:

  • Shares in European airlines have fallen by:

+ 7.7% (British Airways owner IAG)

+ 6.7% (easyJet)

+ 4.1% (Ryanair)

+ 6.5% (cruise operator Carnival)

  • The number of jobs at stake in the travel industry: tens of thousands
  • The amount of lost trade: billions
  • The number of days that travelers will be required to quarantine in hotels: 10 days
  • The estimated revenue loss for Tours International: £1.4m in 2019, no revenue since March

Sources:

  • "UK considers hotel quarantine for international arrivals as share prices plummet", Financial Times
  • "UK faces summer travel chaos as Covid-19 recovery falters", The Guardian
  • Statement by Andrew Crawley, Chief Commercial Officer at American Express Global Business Travel, as reported by The Times
  • Statement by Boris Johnson, the Prime Minister, as reported by The Times
  • Statement by Glyn Jones, Chief Executive of Southend Airport, as reported by The Times
  • Statement by Lana Bennett, Chief Executive of Tours International, as reported by The Times
  • Statement by Tim Alderslade, Chief Executive of Airlines UK, as reported by The Times