Holiday cancellations soar as Coronavirus epidemic spreads
As winter draws to a close and signs of spring are in the air, it’s usually a cue to start thinking about booking holidays. In a normal year, this would be a time for people to make plans for a short getaway, an Easter minibreak or some summer sunshine, hiring a car to give them that freedom to roam. But this year is not a normal year. Since the outbreak of coronavirus in China in December last year, the travel industry has been hit hard with cancellations and a drop in bookings.
Coronavirus - also known as COVID-19 - is an illness which affects the lungs and respiratory system - and is contagious, spreading very easily across the world. Despite efforts to contain the virus and slow its spread, there has been a huge spike in holiday cancellations in the last few weeks, as a result of imposed travel bans from governments or airlines, and as people’s fear of catching the virus grows.
This decline in travel bookings can be clearly seen when it comes to car hire. Here at DiscoverCars.com we have seen total bookings drop by a third (around 30-35%) during the period of the end of February and beginning of March, both to areas affected by the virus and more generally.
Italy’s tourism is hardest hit
Italy has seen one of the largest outbreaks of coronavirus in Europe. Though the outbreak was confirmed in the country on the 31st January, it wasn’t until three weeks later that a larger cluster of cases was discovered in northern Italy, prompting a number of towns to be put into lockdown by the italian authorities and causing many visitors to the country to cancel their plans immediately.
With over 4600 people confirmed to have the virus in Italy, it’s perhaps no surprise that customers are being more cautious about visiting the country. When giving reasons for cancelling, many DiscoverCars.com customers said that they did not want to risk it, either because they are travelling with young children or babies, people with existing health conditions, or because they are pregnant and are worried about contracting the virus.
Before the italian outbreak at the end of February, only around 2-3% of DiscoverCars.com customers had cited coronavirus as a reason for cancelling their trip - but within a fortnight, that number had soared to 30%.
Since 23rd February, there has been a 47% drop in customers hiring cars in Italy - a number which could well increase as more cases of the virus are diagnosed.
This pattern of customer cancellations can be seen in other countries, too. Germany has had a much larger number of cases, with over 550 people diagnosed by the 5th March, and the drop in visitor numbers has reflected this; down 41% since the end of February.
Governments impose travel restrictions
Not all car hire cancellations are down to fear of contracting the virus. Governments around the world have been reviewing their travel advice for different countries on a daily basis, with some countries restricting entry entirely to people who have travelled through the worst-affected areas.
The spread of the virus in Italy has had a knock-on effect for Italians wishing to travel abroad too, as many countries have imposed travel bans for citizens from parts of Italy - which in turn has led to cancellations in car hire. At the moment, there is a ban in place on Italian residents visiting many countries, including Jordan and Turkey, which have both seen a considerable decline in car hire in the last fortnight (down 31% and 19% respectively).
Other countries are doing the same. New Zealand has imposed entry restrictions on people travelling from mainland China and Iran, as well as parts of northern Italy and South Korea, where there have also been high numbers of diagnosed cases of the virus. These safety measures are hitting the tourism industry hard. Air New Zealand slashed the price of 1000 domestic flights to just $9 last week, in response to low traveller numbers, and DiscoverCars.com has seen bookings drop in the country by 37%.
The Canary Islands thrive off tourism and are a popular destination all year round for driving holidays - but these islands are also starting to feel the economic effects of coronavirus. In February, around 700 tourists were quarantined in a Tenerife hotel after at least four guests were diagnosed with the virus. Since then - and with mounting uncertainty - car hire bookings to the Canary Islands have fallen by 18%.
People still want to travel to “safe” destinations
But it’s not all doom and gloom for the travel industry. Although it’s abundantly clear that the spread of the epidemic is hitting some countries hard, it’s not putting people off travelling altogether. In fact, 13% of customers who made cancellations went on to book another destination, particularly those who had cancelled trips to Italy - so there is some feeling that some countries are safer to visit than others.
Destinations that have seen a small but significant increase in customer demand since the February outbreak include Ireland, Croatia, the Azores and Malta: all countries with much fewer reported cases of the virus.
The UK sees rise in staycations
Our figures also show an increase in local tourism. For example, UK travellers are renting a car within the UK with 17% increase compared to two weeks ago.
What will it mean for summer 2020?
As well as the shorter-term cancellations, coronavirus is proving to have an impact on our longer-term travel habits, too. Our data shows that customers are now much more reluctant to book a car in advance. Last year, on average, people would choose to book a car around two months before a trip, whereas now, people are leaving their bookings until the last minute, perhaps reflecting the huge uncertainty surrounding the spread of the virus. This could mean that people will leave it a lot later to plan any summer travel for 2020 - if they choose to travel at all.
The rise in cancellations so far this February/March shows that customer confidence in travel safety can change practically overnight. As coronavirus continues to spread and new cases are diagnosed all over the world, there will be a very worrying few months ahead for the travel industry, whilst companies try to work out what the real scale and economic impact of the epidemic will be.