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Old 30th Aug 2022, 02:10
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Bbtengineer
 
Join Date: Oct 2018
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Originally Posted by OzzyOzBorn
Some excellent points raised in the exchanges above. I would like to add my voice to those cautioning against unbridled optimism for the UK aviation industry in 2023. We need to be factoring in recession, and that means airlines retrenching and conserving cash. Some came close to extinction during the covid era, and their reserves remain weakened and depleted. UK carriers in particular received very little help from government, barring those generic schemes which were available to all employers. They need a period of stability and cannot afford to gamble.

MANFOD and Rutan16 explained the looming challenges well. But I would like to add some additional points. Firstly, the 'voucher redemption bulge' which fuelled exceptional demand in Summer 2022 has largely worked through the system now. It will be a far lesser factor for the industry in 2023. Although in certain respects that is a good thing, as the affected carriers were in effect working off historic liabilities with voucher redemptions not bringing in fresh cash.

2022 also saw a surge in demand for travel from those who had not been able to meet up with friends and family for upto three years previously. Much of that demand has now been satisfied; many of those delayed reunions have now taken place. Exceptions would be Australia, New Zealand and some Asian nations which retained harsh covid entry restrictions upto a much later stage than most of their European counterparts. Some of the delayed Australasia demand will be satisfied in the coming UK Winter season (Antipodean Summer). Certain countries such as China remain too restricted for discretionary leisure travel to return; students and essential business travel will endure the necessary hurdles as their payback justifies it. Even the US was relatively late to lift covid restrictions for visitors.

War in Ukraine remains a major problem. The human suffering is self-evident and I acknowledge it 100%, but for the purposes of this discussion I will stick to the implications for air travel. Fuel prices have soared, and further rises cannot be ruled out. The impact on airlines need not be further explained to most readers on here. Sanctions and airspace closures have imposed longer routings requiring extra fuel-burn for many key routes. Carriers such as Finnair and Air Baltic have seen their East-West business models destroyed overnight. Travel between the UK and Russia is at a virtual standstill. There are calls to ban Russian tourists from vacationing in EU states. Some destinations in Eastern Europe have seen demand for city breaks impacted by perceived proximity to the war zone.

MANFOD touched on exchange rates. The "everything sell-off" in the financial markets has seen the USDX (US Dollar Index) soar to a twenty year high, making Dollars comparatively expensive versus other major currencies. In general, when investment assets are sold payments are made in USD, so demand for these naturally soars when a major sell-off hits. However, whilst we see a very challenging GBP/USD exchange rate, the Euro has endured a torrid run due to perceived reliance of Euroland on Russian oil and gas. So the GBP/EUR exchange rate is far less daunting, and destinations such as Turkey with the cratering Turkish Lira appear to offer great value to travellers. So, as MANFOD alluded to, I would expect to see a continuation of increased demand for destinations which offer 'bargain' prices. Folks might not axe travel altogether, but they may book a fortnight in Antalya rather than Orlando. We also see this effect by airline as well: a carrier such as Ryanair can benefit from customers trading down from premium carriers which they may have preferred previously. So the no-frills short-haul carriers may be better placed looking ahead than those relying on Transatlantic demand, for example.

The cruise industry continues to suffer. They put out upbeat messages to give the impression of business as usual, but demand is muted and caution abounds. Just look how many cruise ships continue to operate loops around the coast of the British Isles. Many more adventurous itineraries continue to get cancelled. Some older customers continue to fear cruise ships as potential vectors for mass-infection. Even those who don't (like me) do fear being confined to one's cabin for a fortnight in the cell if spotted using a tissue. Fly-cruise business will remain challenging for a while yet, and that is another blow to Florida and the Caribbean in particular.

One more factor to keep in mind too. Many customers endured a poor air travel experience in 2022. Airport delays, queues, late cancellations, lost luggage. I've had so many friends tell me they've been put off travelling abroad again for the foreseeable. Companies such as TUI, BA and EasyJet have lost alot of goodwill. This will take time to return. And the administrative aftermath from disrupted travel is an enduring nightmare: endless forms, unanswered phones ("your call is important to us"), staff in India / China sympathetic but not empowered to actually resolve issues when the phone does miraculously get answered. E.Mail communications routinely ignored. I and close family / friends are beyond hacked off with this merry-go-round of failure and frustration. It is actively putting me off making new bookings. Just looking at my own track record, I felt like a full-time travel agent pursuing refunds and juggling vouchers in 2020 / 2021. I'm still awaiting an Air Europa refund from early 2020. SAS refuse to refund an expensive 'non-refundable change fee' despite it being THEY who cancelled the new flights with the customers ready to travel. I'm in dispute with Wizz Air who refuse to refund £95 in 'Wizz Credits' which they neglected to set against my rebooked flights despite me doing everything correctly to enable this to happen as intended. My nephew recently had his outbound travel luggage delivered by Aer Lingus to a remote log cabin in Idaho - two weeks after he had returned home to the UK. He has found it impossible to contact Aer Lingus by any communications channel to discuss this. This year, when covid restrictions had broadly ended, I felt that it was safe to put a toe back into air travel in the form of new bookings. RYANAIR cancelled my return trip MAN-ORK, they took over £250 from my credit card for the "free" rebook to alternative dates option. It took me six months to get that back. EASYJET cancelled my Summer MAN-IOM trip; as I'd committed to ground arrangements on the island I had to rebook with Loganair at a far higher fare than if I'd booked with them in the first place. WIZZ AIR cancelled my August 2022 RIX-LTN booking ... the one I was already in dispute with them about for not applying my Wizz Credit to the booking. I had to rebook Finnair RIX-HEL-LHR as I was already committed to MAN-RIX with Air Baltic. And, speaking of Air Baltic, they have now cancelled my MAN-RIX-MAN booking for four passengers in September.

I realise that the above paragraph is a yarn, but it illustrates an important point. Leisure travel is meant to be FUN. And for too many customers in 2022 it hasn't been anything close to that. I've personally had SIX flight sectors cancelled on bookings made SINCE covid restrictions were lifted in the UK. They all generate another round of thankless admin which I naively thought I'd left behind post lifting of covid restrictions. I know I'm not the only one experiencing this. IT MAKES ME RELUCTANT TO BOOK NEW FLIGHTS. I have only two sectors booked at this point; I'd usually have around 20. That is purely down to avoidance of further administrative hassle, not household budgeting. I can't be the only one who feels hacked off with the airline industry at this point. I completely understand the problems they have faced, but I won't subject myself to more of this until the industry gets its act together. And I want my refunds sorted too. The Wizz Air one is off to arbitration in some EU department. I'd get banned if I wrote what I really think about them on here. Suffice to say that they'll be getting no more business from me or anybody I advise on air travel bookings.

So, in summary. 2023 will be tough.

- The voucher bulge has largely worked through the system.
- Cost of living crisis stressing disposable incomes.
- Exchange rate concerns, fuel costs, geopolitical fears.
- Folks at the end of their tether with the dysfunctional leisure travel experience.
- Continuing cancellations, changes, unanswered communications, delayed refunds, lost luggage, nightmarish admin hassle.
- Fear of sudden new covid restrictions; confinement to cabin / hotel room if seen with runny nose / getting stranded overseas.

ANYONE FOR A HOLIDAY?
I cannot disagree with the frustrations but would offer some counterpoints.

Employment is full.

Fuel prices are declining, as now is inflation.

Work is increasingly remote for many, far more opportunities to travel and still get paid.

Industry overshot to the down side on staffing and will now over correct the other way.

All of these point to increased supply, lower prices and renewed participation.
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