Nearly six months since Australia lost the life it once knew, thousands of would-be travellers are still caught in “loops” waiting for holiday refunds and insurance claims.
Some are waiting for travel agencies, accommodation providers and airlines to process their cancellations, but others are waiting on insurance providers.
“There’s a few scenarios where people are just caught in a loop, waiting for a credit or a refund,” Choice travel expert Jodi Bird told The New Daily.
“Probably the most common consumer inquiry that we get is from people that are still chasing airlines.
“Or they could be in these kind of situations where they might have travel insurance that actually did cover their trip.
“The provider at the same time said that it will give them a refund, but they haven’t done that yet. But then they can’t also claim on travel insurance.”
Thousands in the waiting lounge
It’s estimated that refunds could take up to a year to come through for some travellers, according to Australian Federation of Travel Agents chairman Tom Manwaring.
“You’re dealing with 52 international carriers into Australia, 60 to 70 cruise liners, hundreds of different hotel options – so all of those individual businesses have their own individual (terms and conditions), ” Mr Manwaring told ABC, estimating there was about $10 billion in untaken holidays to be processed.
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Short-term gain for long-term changes
David Beirman has been in the travel industry for almost 40 years, in retail, wholesale and now as a lecturer at the University of Technology Sydney.
When we are able to travel again – the latest bet is 2024 – airlines will be desperate to get bums back into seats, Dr Beirman said.
“In order to get people excited about the fact that we can fly again there will be a period where there are a lot of cheap fares around, because airlines, tour operators, hoteliers are going to want to start getting business back,” Dr Beirman told TND.
Don’t expect these to last for long, however.
Dr Beirman explained: For the past 50 years or so, the travel industry has worked on a basis that if you sell enough tickets, fill enough hotel rooms, book enough airline seats, you can run on a razor-thin margin.
“But what’s happened is that when things got bad during the coronavirus, those companies actually had no reserves to fall back on,” he said.
“In tourism, airlines are usually operating on yields of less than half of 1 per cent. So for a $2000 airfare, if they make 10 bucks, they’re doing actually pretty well.”
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What does that mean for consumers? It means the airlines have had the wake-up call that was a long time coming.
“They’ve realised, we can’t operate like that any more,” Dr Beirman said.
“So what you’ll find is there will be a couple of good lead-in deals around – but they’ll be very hard to get – and after that the cost to travellers will probably go up.
“I don’t think (the tourism industry) can afford to go through what they’ve just gone through, a second time.”
On the sunny side
Although the travel industry will be one of the worst hit from the pandemic, there might be some silver linings to what is a very dark cloud.
Mr Bird believes travellers will take more responsibility for reading the fine print on the products they’re buying.
“They’re asking, what happens if they need to change their trip?” he said, saying there are some Aussies beginning to try domestic travel.
“Their eyes are wide open as to the possibilities that affect the trip in the future.”