UK air passenger arrivals slumped 98% during first pandemic wave

Government urged to reopen international travel by May 1 as industry stands ‘on the edge of a precipice’

UK air passenger arrivals fell 98.3 per cent in the first wave of the pandemic, causing alarm for the sector as a new action group demanded the government restart all international travel by May 1.

Monthly arrivals to the UK fell to 112,300 in April 2020 from 6.8 million in February, according to the Office for National Statistics, backing up concerns from the lobby group Save Our Summer that the industry must have a fixed reopening date to protect jobs.

The group, made up of UK travel companies whose total annual revenues came to more than £11 billion ($15bn) before the Covid crisis, wants reassurance the sector will reopen after the government advised UK residents not to book a holiday either in Britain or overseas.

"The travel industry stands on the edge of a precipice. A minister's job is to protect our industry, not destroy it," said Henry Morley, chief executive of True Travel and co-founder of Save Our Summer.

The UK’s travel and tourism sectors were hit hard by the pandemic in 2020 after the first wave of coronavirus saw many countries shut their borders to international arrivals.

International travel was first discouraged by the UK government on March 16, before a nationwide lockdown started a week later on March 23. While a slight easing of restrictions over the summer saw flights pick up, this was followed by a further hit to the sector in November and last month due to the second and third English lockdowns.

In the latest blow, England, which is home to about 85 per cent of the UK population, launched a hotel quarantine system on Monday, demanding that passengers arriving there from any of 33 'red list' countries spend 14 days in a hotel room under new border restrictions designed to stop the spread of new Covid-19 variants.

The disruption has discouraged British expatriates across the globe, including in the Middle East, from travelling to the UK.

In the second quarter of last year, overseas residents made 96 per cent fewer visits to the UK and spent 97 per cent less than they did in the same three-month period a year earlier.

There was also a 91.3 per cent drop in traffic through EuroTunnel in the first wave of the pandemic, with only 19,862 passenger vehicles travelling through in April 2020 compared to 227,393 in the same month in 2019.

The drop in passenger arrivals across the sector saw turnover in travel and tourism businesses fall to its lowest level in May, at just 26 per cent of February levels.

Accommodation and travel agency businesses were the hardest hit with turnover in May falling to 9.3 per cent of February levels.

Employment has also been a challenge, with pilots forced to switch to lesser paid roles, such as working as a coffee roaster, after flights were grounded.

The number of Britons listing their main job as travel or tourism 10.8 per cent lower in the third quarter of last year than in the same period in 2019. The sector also had higher rates of people on full or partial furlough leave than other industries in the UK, and

Ruth Gregory, senior UK economist at Capital Economics, said the possibility that international travel restrictions could remain in place this summer implies that the rapid vaccine programme “won’t be enough to ensure a swift return to normality” for the sector.

Last week, the government suggested that countries could be added “within a few hours” to the ‘red list’ of countries from which returning passengers must isolate for 10 days. Meanwhile, transport minister Grant Shapps said Britons might have to wait for other countries to catch up with the UK's vaccine drive before international restrictions can be lifted.

The SOS action group, which includes travel companies Trailfinders, Easyjet Holidays, DialAFlight, Celebrity Cruises and Elegant Resorts and Teletext Holidays, said "the industry is united in outrage" over the government's mixed messages on booking holidays.

“Senior government ministers have done a good job of torpedoing recovery in the travel sector and threatening jobs across travel and tourism. UK citizens should ignore their conflicting advice and book summer trips with confidence,” said Paul Charles, of the PC Agency and a co-founder of SOS.

Ms Gregory said while international travel restrictions were always likely to remain in place longer than domestic ones, which will increase the pressure on the government to support the industry in the Budget on March 3, there are two main sources of comfort.

Passengers arriving at Heathrow's Terminal 5 are escorted by security staff to buses on the first day of the UK's hotel quarantine scheme. Getty Images

The first is the tourism sector is small relative to the total economy, with foreign tourism directly accounting for just 0.5 per cent of gross domestic product (GDP) in 2019, even before the pandemic crushed it. This means domestic tourists are five times more important for the industry as they account for about 7.5 per cent of GDP.

“Second, the domestic tourist sector may pick up some of the slack. And since UK residents usually spend more money abroad than foreign visitors do in the UK, there could be some favourable substitution effects,” Ms Gregory said.

“So longer lasting travel restrictions are unlikely to throw a rapid rebound in the economy off course once the Covid-19 restrictions are eased from Q2. Instead, it’s more important to have the domestic economy open than the international tourism one.”