02 Dec 2020
By Stuart Patrick, Chief Executive of Glasgow Chamber of Commerce
When the final government restrictions are lifted and people are free to make their own decisions once again, how quickly will demand for overseas holidays and business travel re-emerge and what shape will the aviation industry be in to respond?
These questions are crucially important for Glasgow’s economic recovery. The success of the city’s economy and its airport have to date been profoundly intertwined.
The range and depth of our international air connectivity has an impact not just on leisure tourism, upon which so many of our local businesses depend, but on inward investment decisions in financial services and healthcare industries, on the location choices made by literally hundreds of business conferences which have been the mainstay of the Scottish Events Campus and on the ability of global industries like whisky and engineering to reach their markets all around the planet.
It is now a commonplace to suggest Covid-19 restrictions and the rise of web conferencing and home working are permanently changing our habits and substantially reducing the need for travel. That though would break a long-standing complementary relationship. Telecommunications usage and travel have essentially grown in lockstep for decades.
There are signs that there is pent up demand for foreign leisure trips. When the Pfizer/BioNTech vaccine was first announced, travel website Skyscanner saw a 48% jump in transactions for Easter and summer breaks. EasyJet reported a 50% boost in bookings.
Perhaps there will initial caution especially amongst those more vulnerable to the virus but it remains quite hard to believe that we are ready to give up our summer sun, our city breaks or our long-haul visits to friends and family.
Business travel may take longer to recover now that companies have discovered what can be achieved without corporate travel budgets, but the SEC also reports many of the business conferences that fell victim to Covid-19 restrictions simply re-booked for later in the calendar.
Demand may recover but will the familiar flight options still be available? Airlines have been reducing the size of their fleets to cope with the collapse in travel demand. Some aircraft like the Boeing 747 are being permanently retired.
Every airport in the world will be pressing airlines to reopen their routes and the airlines will be choosing their priorities with care. Scottish airports are going to be in a vicious competition to claw back lost connections.
Some governments are well aware of the challenge. Last month the Irish Government announced an expanded package of €80m financial support for its aviation industry on top of its own version of the Job Retention Scheme. Minister for Public Expenditure and Reform Michael McGrath commented that ‘Ireland is an open and global economy and it is vital for our economic progress that we have a strong aviation sector.’ Ireland has also reduced its quarantine requirement for arriving passengers from 14 days to five if they have a negative test.
Glasgow Chamber’s own feedback suggests that Scotland’s main airports do not feel so well supported. Granted airports have received rates relief this year but there is no sign of the Scottish Government replicating the UK Government’s decision to use testing to reduce quarantining requirements.
The UK Government issued its Global Travel Taskforce report last week committing to a variety of safety measures and tourism and aviation recovery plans. Perhaps the Scottish Government could do something of its own design making short term moves on testing, revisiting its position on Air Passenger Duty and supporting route development funds in return for industry commitments on net zero.
Our economic recovery will be much faster if we take our airports more seriously.
This article was first published in the Herald Scotland on 2 December 2020.
