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Booking Holdings ( Kayak, OpenTable, Agoda, Priceline, etc ) recently had their latest earnings call, and amidst announcing an 84% decline in earnings YoY, Glenn Fogel, Booking CEO, also made a prognostication on the travel industry as a whole. He forecasted that travel is unlikely to bounce back until after a vaccine. Of course, just because there is a vaccine doesn’t mean you’ll actually be able to get it, and apparently the majority of Americans have expressed doubts as to whether they will want to jab themselves with the fastest ever vaccine produced. Regardless, his forecast is pretty gloomy for those of us who love exploring the world.
You can read the entire transcript here if you like, but this is the portion where he anticipates that travel won’t rebound for years.
We continue to believe that in order to recover to pre-COVID levels, we will need to have a vaccine or effective treatment, which will take time to produce and distribute globally at the scale needed. We are pleased to have recently read news about progress on this front. But we believe it will be years and not quarters before the travel market returns to pre-COVID volumes.
In those countries and regions where shelter-in-place rules were relaxed and economies reopened, we witnessed booking trends improve quickly. We believe part of this initial burst of demand is due to people’s pent-up desire to go somewhere after being in a lockdown situation. It also demonstrates people’s deep desire to travel, providing it to safe.
Let’s juxtapose these comments alongside the comments of the CEO of AirBnb who famously said “travel as we knew it is over.” While Fogel isn’t going that far, he is indicating that their analytics speak to similar trends: people don’t want to go that far from home, and they don’t want to go to city centers.
In line with our growth in domestic travel, we are seeing that bookers are choosing to stay closer to home, and are more interested in less urban areas than pre-COVID.
Time will tell, but I’ve been living in hotels since July 3rd. None of my travel was for “leisure” and all of it was either to stay close to family and I would classify that as “close to home,” or travel to an area that I may move to and tour properties – or close to my future home. I haven’t taken a “vacation.” I’ve been bathing hotel rooms in bleach, using disposable plates, cups, knives, and forks, and if I lived close to family I wouldn’t be doing any of this since it’s a big pain in the butt and I don’t really feel at ease. The trend these CEOs are talking about, I would say I’m a part of, and despite contributing to the bottom line of several hotel chains in the last 30 some days, I don’t see myself taking a “leisure” trip for quite some time.
What do you all think?
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