Voices in the travel and tourism industry are renewing their calls for greater support for travel firms following the losses they incurred during the Icelandic volcanic ash crisis.
Senior figures in the travel industry have long been saying travel companies were right to demand financial compensation for the losses suffered, because the regulatory authorities over-reacted and misjudged the crisis; the excessive closure of airspace making the impact of the ash cloud much worse on travellers and firms, especially airlines.
Airlines lost millions in revenue daily due to the closure of airspace, but many companies subsequently argued the decision-making to close European airspace so widely and for so long in April 2010 was mishandled.
The World Travel & Tourism Council (WTTC), a leading members association of business leaders in the travel and tourism industry, is the latest organisation to enter the on-going debate.
The WTTC, whose members include CEOs and other senior figures from companies such as Accor, British Airways, the Beijing Tourism Group, The Hertz Corporation and Etihad Airways, is insisting the European Commission re-examine compensation legislation following the Eyjafjallajoekull volcanic ash disaster earlier this year.
The demand comes as debate reignites about how much airlines and tour operators should foot the bill when it comes to compensating passengers.
“While passengers should certainly be reimbursed for out of pocket expenses – the fallout of the volcanic ash cloud is unduly impacting an industry that is already subject to excessive regulation and taxation, says Jean-Claude Baumgarten, President and CEO of the WTTC.
“This situation originated from force majeure – and not as a result of mismanagement by airlines and tour operators. We believe it is time the EC recognise this and re-examine how the legislation is applied in such circumstances.”
WTTC believes that, while governments were right to take precautionary measures at the first sign of the ash cloud, restrictions went on too long and were undertaken without proper consultation with those most affected – the airlines and tour operators now having to meet the resulting cost.
“Tourism is being hit with a double whammy: the loss of business as planes were grounded and now the cost of reimbursing passengers. With evidence that some operators – particularly small and medium sized enterprises which make up more than three-quarters of the industry – are struggling financially this year, it is an unwanted and unwarranted burden. We cannot help but think tourism is being punished for circumstances not of its making,” says Mr Baumgarten.
According to WTTC, legislation is too prohibitive in its current form and does not allow for circumstances beyond the control of the aviation industry.
“One of the biggest industries in the world, travel and tourism has real potential to drive economic growth and rapidly create employment opportunities in the future,” Baumgarten adds.
“But we rely on governments to consult with the private sector and develop measures to combat barriers to growth and help the industry thrive.”
As well as compensation legislation, harsh economic sanctions the WTTC says are facing the industry include visa policies and processes, taxation such as the UK’s Air Passenger Duty and infrastructure restrictions such as airport expansion, and not least the cost incurred by airlines who have to pay for increased security measures at airports worldwide.
The tourism industry is worth US$5.7 trillion/£3.67 trillion to global GDP and employs 235 million people worldwide.
With new markets emerging all the time, these are expected to grow to more than US$11 trillion/£7.08 trillion and 303 million respectively by 2020.
