BUSINESS NEWS of travel’s hoped-for restart. By Ian Taylor


Wratten: Business travel won’t pick up until autumn


Corporate travel leaders expect the leisure sector to lead the industry’s restart with business travel not expected to pick up until September at the earliest. Clive Wratten, chief executive


of the Business Travel Association, said: “You’re probably looking towards September and the autumn for a pick-up of any scale in business travel.” He told the Travel Weekly


Future of Travel Forum: “There is pent-up demand, but we need a successful leisure season this summer to give people confidence in a return of business travel.” However, Wratten warned: “By the time we get to September, our


members will have gone 18 months pretty much without trading. Leisure travel had a little spike last summer to get some cash in. The corporate business has not had that.” He added: “In many ways, the


hardest time is when you start trading again and bringing people back and costs start coming back. “It remains a serious situation.


The only thing that is going to save us is lifting the travel restrictions and getting us moving again.”


Clive Wratten


Catch up with all the Future of Travel sessions: vimeo.com/showcase/futureoftravelspringforum


Travel’s restart will be ‘dangerous time’ as businesses take on costs


The restart of international travel could prove “the most dangerous time” for outbound businesses, industry financial advisers warn. Chris Photi, head of travel and


leisure at White Hart Associates, described balance sheets as “shot to pieces” and said: “We’re going into an extremely difficult phase.” Speaking at the Travel Weekly


Future of Travel Forum, Photi said: “I expected more failures. Businesses have managed to keep going by controlling their liquidity, but my worry is what happens in relation to bounce-back? It’s impossible to raise investment during such uncertainty. “This is the most dangerous time.” Photi argued: “There is pent-up demand. There are good amounts of


disposable cash. But these have to be offset by the state companies are in. And if you need money for marketing and you haven’t got it are you going to be able to make use of bounce-back? “We’re in a hiatus period. It’s all


about survival. [But] there are a lot of businesses at the end of their fuse.” Adam Pennyfather, head of


financial consulting at the Travel Trade Consultancy, said: “We’re seeing evidence of pent-up demand, but if it’s stop-start you risk turning the taps on [and] if bookings don’t come to fruition, you’re back in the same scenario. You’ve got to have people in to issue refund credit notes and administer refunds, and that comes at a cost which most businesses can’t afford right now.”


‘Atol renewals incredibly difficult’


The March Atol renewals are proving “incredibly difficult” but there will be no extension to the deadline, say industry financial experts. Adam Pennyfather, head of


financial consulting at the Travel Trade Consultancy, warned: “Balance sheets are worse than at the last renewal [in September]. Many businesses don’t have the facility to top up balance sheets or inject cash to correct a liquidity position to where the CAA expects it to be.” Speaking at the Travel Weekly


Future of Travel Forum, Pennyfather described the Atol renewals as “incredibly difficult”, and said: “It is getting too late if you need to top up [liquidity]. [But] we’re told there will be no extension to the deadline.” Chris Photi, head of travel and


leisure at White Hart Associates, agreed: “It’s incredibly late in the


travelweekly.co.uk The CAA has no


desire to precipitate failure but it’s not going to drop its pants as far as its rules are concerned


process [and] the head of Atol told me unequivocally there will be no 28-day extension.” He explained: “The CAA


has two sides to it and there is a resource issue on the smaller Atol side. On the larger licence side, they are monitoring more or less on a monthly or quarterly basis. There is a relatively simple liquidity test.” But for smaller Atol-holders,


Photi said: “The CAA has an automated scorecard. You go to a portal and submit your financial


Chris Photi


Ian Taylor


Adam Pennyfather, Travel Trade Consultancy


Krystene Bousfield, Travlaw


data. It produces a result and they email saying ‘In order to renew your licence, you need to inject £700,000’. Then it boils down to have you got someone to negotiate with the CAA?” Despite the prospect of travel


restarting from May 17, Photi told the summit: “The CAA is not going to drop its pants as far as its rules are


concerned. They have no desire to precipitate failure. But they can’t say, ‘We’re going to let everybody renew and keep our fingers crossed and hope nothing happens’. “If they renew a licence in March


and it fails in April-May, it’s going to come back to them. So they are between a rock and a hard place.”


25 MARCH 2021 47


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