(IPW COVERAGE 2) A 2022 Recovery Just Might be Attainable
Prior to the White House announcement that the Biden Administration was opening up travel to the United States from the EU and England, it was—to put it plainly—a tough sell, even to one’s self, to suggest to wholesale travel buyers in these countries that Visit USA traffic was what they should buy.
The No-Market Indicators: From March 2020 onward, the market has been below flat. Period. And it kept declining. Cancelled contracts. Job layoffs. Budget reductions. Smaller staffs. Bans on visitor traffic from every Top 20 overseas source market. Fear of travel on the part of consumers.
Such was the environment as buyers, suppliers and journalists gathered last week at the new extension of the massive Las Vegas Convention Center for the occasion of IPW. The emptiness of so many rooms and the smaller-than-usual numbers generated by the trade show (the last edition was held in May 2019) only contributed to the barrenness of the setting. There were no crowded aisles and no queues of delegates waiting for doors to open for lunch and, because tables were distanced and luncheon times were staggered, no one was waiting for lunch, either. Indeed, many took their boxed lunches with them, opting for sunnier atmosphere outside.
Some numbers gleaned from presentations and discussions include the following:
It seemed that just about every measure of IPW 2021 was about one-third of what it was in 2019 at IPW in Anaheim, California:
—As for the overall number of delegates, it was about 2,600.
—There were 700 international delegates from 52 countries.
—The number of journalists totaled about 300.
—Number of journalists from the UK/Ireland market in 2019: 52
—Number of journalists from the UK/Ireland market this year: 17
What the Outlook Was as IPW Convened: At the outset of IPW, on Sunday, as suppliers worked on their booths and as international delegates and journalists enjoyed fam tours of Las Vegas, and prior to the news that the White House had opened up international travel, the consensus outlook from U.S. travel sellers and destinations that we heard was something like this:
—There is no prospect that travel sellers and destinations will have any success whatsoever in Q4 this year.
—There is a chance, as more countries increase the number of its residents who have been vaccinated against the COVID-19 virus, that there will be some first quarter recovery early next year. Meanwhile, there was not enough demand for winter product to make a difference.
—There is the possibility of some Q2 recovery, possibly anchored by the travelers from those markets which observe the Easter holiday, which falls on April 17, 2022.
—A similar scenario plays out for the all-important-but-inactive Chinese market, where the national holiday, Labor Day, May 1st, falls on a Sunday.
—April will also be important for the dormant market of Japan, where there is a Japanese Golden Week that runs from Friday, April 29, and ends on Thursday, May 5—suggesting that some Japanese might expand the week even further.
—The summary outlook answer, then, is that the beginning of some meaningful, yet tepid, industry recovery—the opening of borders is a must—is possible in mid-to-late Q2.
What the Outlook Was as After the News: The first person we talked to after the news came out on Monday morning that the Biden Administration was allowing vaccinated people from England and the EU to travel to the USA, was Jason Hackett, senior vice president, sales and marketing, SUMMIT One Vanderbilt, in New York City. A frequent speaker and panel discussion moderator at industry events, Hackett, a New Yorker, was quick to tell us in a New York Minute that yes, if nothing “wonky” happens, the numbers, elements and consumer indicators are there for the beginning of a modest recovery in Q1-Q2.
Like others, though, he was a little tentative about predicting, in hard numbers, what a recovery might look like vs. 2019 (which, by the way, was a record year for more than half of the Top 20 overseas source markets for travel to the U.S.). Because they expected that the 18-month COVID-19 crisis would continue, he suggested, some suppliers were going to be short in personnel and would have to restock their product shelves with missing inventories and itineraries.
But Hackett was keen to the possibility of how British and other European markets are ready to explode in order to satisfy a pent-up demand for their holiday in the USA. If so, he reasoned, we should begin to see and feel the impact of recovery in the second quarter of the year.
Peter van Berkel is as knowledgeable as anyone in the United States when it comes to discussing major European markets and the state of inbound tourism in America. Fluent in Dutch, English, French and German, he has led TRAVALCO, a major Southeast receptive tour operator, for 36 years. And for nearly six years, he has served as chairman of the International Inbound Travel Association (IITA).
He likened the difference between “before” and “after” the news that Visit USA travel will be accessible to the difference portrayed in the “Tale of Two Cities.”
“The industry is elated,” he said, noting that the reopening of the U.S. on a date certain (early November) will help the industry gear up in order to “work through the logistics” required to: meet, greet, transport, house, entertain, conduct tours for, and feed (a difficult challenge because many restaurants shut down or went out of business during the pandemic?) visitors.
However, van Berkel (as have his colleagues in IITA) sounded a warning about an issue that seems to have been pushed into the shadow, yet will represent a serious challenge once international travel to the United States from abroad returns to a “new normal.” And that is the serious backlog in the processing of application for a visa required to visit the USA.
The visa issue has not been an issue while there has been no travel to the United States, van Berkel explained. But he pointed out, there is a backlog of thousands of visa applications in both China and India—both are Top 10 overseas source markets for the USA—that will have to be processed. Other nations will also have to face the challenge. If not, he said, many, many thousands of potential visitors will not make it to the United States.
