September 2022 Newsletter
Travel is a Majority Decision
The pandemic brought lots of opinion on how it would impact the world of travel and many opportunists were keen to make their view of the future heard. Just how many of these same people would wish to hear their opinions a couple of years on is a totally different question as the majority of these opinions were certainly coming from empty vessels. Two possible shifts that were frequently predicted to impact the world of business travel either directly or indirectly are worth noting. They are the move to remote working and the taking of longer but fewer business trips.
Taking the duration of business trips first, recent surveys by the German Business Travel Association VDR, has found that the popularity of the one day business trip has been waning since 2020 with most trips now being at least two days in duration with travellers cramming more into their trips than previously. As for working remotely, this is a story that wont go away fast and opinions are divided in whether employers want their staff in the office or be allowed to work from home. There currently appears no definitive answer and the trend may indeed differ from industry to industry. Cost savings for an employer can probably be made through remote working as office space is reduced in size and hence rental payments decrease, but the potential loss of productivity and creativity from employees as well as potential issues with training new staff may lead to false conclusions about the merits of home working. However the tail may be wagging the dog currently in this area with employers having to appease not only existing staff by offering home working options, but also being forced to offer likewise to ever more demanding potential new talent. The full impact, benefits or otherwise of the work from home v work from office game will take a few more years to clearly identify itself.
One other area that the VDR noted that was coming more and more into play in the world of business travel was the rule of sustainability. The need to be seen to be doing the right thing has been prevalent in many larger organisations for some time, but again, the pandemic gave people more time to think and the result is an even greater need for employers to be seen to be doing the right thing for our planet. What this translates to is “what sort of carbon footprint is travel leaving behind” and thus is travel avoidable? Actually, the answer is no travel is not avoidable if it pays the bills, keeps people employed and keeps the company financials in black ink rather than red. The VDR reports suggests that larger cash rich companies view this topic as more of a ‘’today issue”’ with 82% paying significant attention to the issue of sustainability whereas in the SME sector, it is more bothered about trying to survive and just 28% of those with less than 500 staff see sustainability as worth bothering with.
As we have all seen, the rhetoric from green leading agendas during the pandemic was largely tossed out of the water once the world returned to some sort of normality. People want the joy and thrill of travel to widen their own horizons. Families want to stay in physical contact with each other now that the world is a village and that village means that people live and work in places our grandparents could only dream about. Business’s need their staff to travel to ensure their own survival and to pay their own employees in order for them to pay their own rent or mortgages, to put food on the table and to have their own further ability to travel to visit far flung locations for either personal satisfaction or to simply visit friends and family. The travel industry is here to stay whether people wish to admit it or not. It is a choice but as is apparent, it’s a majority decision in a democracy.
Jamadvice Travel | BCD Bulgaria
Wizz Air is to purchase another 75 aircraft as it continues its march across Europe and indeed further afield. The deal with Airbus is to take 75 A321 neo planes which had been part of a deal struck with Airbus in 2021. The A321 plane is the largest in the A320 family and typically carries around 220 passengers and more importantly, the plane has to capability to reach mid-range destinations
Wizz intends to have 500 planes in its fleet by the end of this decade and also to reduce its carbon footprint by some 25% in the same time frame.
Hertz has penned a deal with car manufacturer General Motors for delivery of 175,000 electric vehicles over the next five years. The deal will see General Motors deliver a range of Electric Vehicles (EV’s) from its Chevrolet, Buick, GMC, Cadillac and BrightDrop brands. The vehicles will range from compact and midsize SUV’s to pick-ups and luxury vehicles.
Whilst the march towards adoption if electric vehicles will not be stopped, one does wonder if the increasing cost of charging electric vehicles outside the home will slow the process somewhat? That cost is many countries is now the same as filling up with normal fuel. Electric cars are also more expensive to buy than normal petrol cars currently although the difference is expected to diminish in the years to come.
Back to Normal in France
How do you know when the world of travel is back to normal? Simple, its when there is a strike in France by some group connected with the aviation sector. This time it’s the Air Traffic Controllers who went on strike on the 16thSeptember and (at the time of writing) plan more strikes before the end of the month.
What is curious is that French Laws protect domestic flights in France but anyone over flying the country, regardless of whether they are operating from or to anywhere in France, are forced to either cancel or make a huge and costly diversion.
Protection of the right to strike: yes, but also the right of those impaired or who suffer financial losses to sue the Air Traffic Control unions should also be protected.
Hyatt’s Make their Mark
The Hyatt chain is new to Sofia with their first branded property opening relatively recently in Sofia, that is about to change with a further five and even six properties about to enter its Bulgarian portfolio.
Five Black Sea Hotels that were formerly under the Riu brand are to become Hyatt’s under a multitude of brands: the Secrets Resorts and Spa’s. Dream Resorts and Spa’s Breathless Resorts and Spa’s and Alua Hotels and Resorts. These are all a part of the Apple Leisure Group Portfolio that Hyatt acquired in 2021 and specialises in resort brands.
Bulgaria will be the third European country to welcome these All-inclusive brands alongside Spain and Greece.
Major hotel brands have become increasingly active in the luxury All-inclusive sector with rival groups Accor and Melia also launching similar collections. Meanwhile Marriott is aiming to have 33 All-inclusive properties in its collection by 2025.
As a further footnote, the Pravets Hotel near Sofia, one of the most popular locations for meetings and events is currently closed and undergoing a huge refurbishment that will also see it re-open and carry the Hyatt name though the actual brand type is not officially made public.
Four or Two
The narrative of “going green” is something only the bravest will challenge; however flaky the arguments are to suit that narrative. A good example of this is the news that Israel will ban air four-engined aircraft from March 2023. Not that from a commercial aircraft point of view it makes much difference as currently there are no commercial airlines using four-engined planes flying into Israel, although it was thought Emirates were considering using a four-engined A380 sometime in the near future. The reasoning from the authorities being that such a ban is being adopted due to environmental noise and sustainability concerns. That approach sounds a reasonable one and one that will win brownie points from the green brigade but there are a few facts that might bring into question that actual logic.
Aircraft with four engines and not always less environmentally friendly than two engine ones. The A380 for example due to its larger passenger capacity has a lower fuel burn per passenger than many two-engine aircraft. Having four engines also does not necessarily mean they are noisier: modern technology adopted on new aircraft engines means that newer four engine planes are invariably quieter than older two engine planes.
So what is white isn’t always as white as it may first appear, but if the wind of change, as well as financial grants ensue together with a broadly plausible green business plan, only a fool would challenge it.
The hotel scene across Europe has seen a steady stream of openings in 2022 with just under 450 new properties seeing the light of day for the first time. 188 of these opened in the first six months of the year bringing some 28,350 rooms into the market. These will be joined by some 250 hotels in the second half of the year which will bring with them 36,500 rooms. Looking further afield 840 new hotels are expected in Europe in 2023/2024 with a total of 126,000 rooms.
In terms of hotels in the pipeline, the UK leads the way with 309 projects followed by Germany with 258 and France 152. The city with the most hotel projects is London with 80 which will add 14,000 rooms to the capitals room total. Dusseldorf is second with 46 followed by Paris with 35. Lisbon and Istanbul follow close behind with 34and 32 projects respectively.
In terms of which hotel brands are the most active, Accor owned Ibis has 92 projects on its books whilst Hampton by Hilton has 69. Holiday Inn Express has 60 followed by Marriott’s Moxy brand which has 51.
World Record starts and finishes in Sofia
Sofia Airport had a global audience recently as a 17-year-old British-Belgian pilot became the youngest in the world to circumnavigate the globe. Mack Rutheford’s global adventure spanned 52 countries and took five months having set off from Sofia on March 23rd before landing back in Sofia on August 24th.
The journey took him over Italy towards North Africa before heading over the Gulf region and onto India, Thailand, Vietnam, Philippines, Taiwan, South Korea and Japan, before heading across the Pacific towards the USA, Canada and Mexico. The final leg saw him head across the Atlantic and passing over the UK before landing back in Sofia.
On arrival Mack said one of his most “memorable’ legs was when he arrived just before nightfall on a deserted island with no lights on the runway. He slept in a small shed at the side of the runway before taking off again in the morning.
Spot the Difference
The difference between so-called Low-Cost Airlines like Easyjet and Ryanair and traditional airlines like Lufthansa and British Airways has blurred over the years to the point nowadays where its not unreasonable to question if indeed there is any difference at all. That applies not just to the on-board service – or lack of – but also in the way fares are constructed and sold to the general public. The thin line that differentiates the two models may about to become even hazier as EasyJet is launching a trail for its passengers who buy more flexible tickets to gain access into the sacred heartland of traditional airlines, namely, the airport lounges.
The three month trial is already in operation at its London Gatwick base where EasyJet is the largest operator. During this trial period access into the Gateway Lounge will be granted if buying the carriers flexi fare which also includes cabin and checked baggage, fast track security and boarding as well as free changes to tickets. Additionally, other EasyJet customers can buy access for 18.99 GBP.
Next? Probably Low Cost Airlines will introduce frequent flyer status levels and thus removing the traditional airlines “USP” and then there will be no difference in the aforementioned business models, except that is one will be cheaper to travel with than the other and the rest is all about marketing!
The Star Alliance group of airlines comprising of 26 member airlines and led by the likes of Lufthansa, Austrian and United, is pushing for at least half of its members (airlines) to have adopted biometric technology by 2025. This would mean for example the use of face recognition technology when issuing boarding passes, at baggage drop off points, at security and at the gate prior to boarding an aircraft. What the concept does require however is airports to join in with the plans; a factor that may in reality be harder in practice than in theory.
The recent Flu Pandemic saw the initiation of the need for change in what was, at the time and arguably still is, a chaotic aviation industry. Contactless technology initially was seen as a mechanism to prevent the spread of a virus, but as the Covid Virus dies down and a new one has yet to be introduced, the staffing shortages at airports also showed that the whole passenger experience at airports would benefit greatly from such technology, pushed no doubt by airlines with the customer experience in mind but followed not too far behind by the fact that such a process may also save them money; especially if they can convince the airports its they would should invest in the technology to facilitate this and not the airlines themselves.
In Europe, the current use of biometric passports means the transition to biometric technology has in fact already started, but the up take globally differs markedly with some regions being more technically capable than others plus privacy laws differ greatly by region. Finally, aviation technology provider SITA reports that some 38% of airports worldwide plan to have some form of biometrics in place in the next three years which is a big shift from 3% last year.
The Air is not Blue
Romanian Low Cost airline Blue Air has suspended flights until 10th October. Apparently, the airline owes 2m Euros in fines relating to more than 11,000 flights that were cancelled between April 2021 and April 2022.
Blue Air were particularly strong in connecting Romania with Italy and rival carrier Wizz Air has not been slow in moving into the void and has based another five aircraft at Bucharest Airport. Indeed, both Wizz and Ryanair are offering so called “rescue” fares on affected routes for passengers who have had their Blue Air flights cancelled.
Watch this space to see who will come out on top in this “opportunity”.
We frequently hear about airlines going bankrupt and also occasionally the same with hotels, but rarely do we hear about an airport closing because of its financial viability. UK regional airport Doncaster Sheffield has just bucked that trend with its announcement that it is to wind down its operations from 31st October. The decision comes even after numerous attempts by various bodies to find finance from either state or private sources to keep the airport open. Airport owners the Peel Group made the point that regardless of whether they accept any short-term aid or not, the airport is not financially viable so any funds poured into it now will be lost regardless.
The airport has always struggled to attract airlines and was dependent on a handful of charter flights and a small presence by Wizz Air whose withdrawal from the airport during the summer proved to be the final nail in the coffin. Indeed, Wizz Air serviced Sofia from Doncaster Sheffield in past years. The closure of the airport will also leave one of the UK’s largest Urban areas without a major airport.
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