Travel sector to see resurgence in 2023, says Thomas Cook
As concerns about a severe recession in the West recede, India’s travel business will recover stronger than before in 2023 on the back of high domestic travel demand, recovery in business travel and India’s hosting of the G20 summit, said Madhavan Menon, chairman and managing director, Thomas Cook India Ltd.
“India’s travel recovery has stood out globally at an economic level and that is very visible in our industry also. People are going to continue to take holidays,” Menon said in an interview.
Aviation industry is grinding through a shortage in supply of new aircraft, and many airlines have not returned to their full seat capacity. These factors have driven up fares, but Menon expects fares to fall towards the end of the year. On the other hand, hotel rates will be set by supply and demand. Globally, they may settle down only after the second quarter of the new fiscal year.
“Domestic demand, though, is huge in India, especially in locations like Goa, Rajasthan and Kashmir. Even city hotels are exhibiting high prices and the domestic demand, both tourism and business-linked, will continue to stay high,” said Menon. Fairfax-owned Thomas Cook India was earlier focused heavily on European travel in terms of international outbound leisure tourism, but today, Asia and domestic travel dominate its business, with Europe re-emerging and the US expected to re-emerge later. Menon is confident that for long-haul travel too, this year will be better than last when it suffered due to visa issues, capacity caps and high airfares.
“Covid changed the way we viewed the customer. We value them much more than we did before. There is a so-called “new customer” who had never transacted with us before. We discovered a younger generation approaching us, and this was partly aided by the fact that we updated our technology and made it an omni-channel approach,” added Menon. Earlier, only about 4% of the company’s transactions happened digitally. Today, that number has grown to 14%. It intends to take these up to 35%. India’s presidency of the G20 could also add to hotel demand, for which the company is providing services to the government. While Menon did not comment on how much he expects the government to spend, industry estimates peg it at ₹900-1,200 crore.
