Minutes of Y's Men Meeting of January 19, 2017
The travel industry is an incredibly important one. It accounts for:
· Seven trillion in revenue
· 266 million jobs
· The largest source of revenue for 83% of the globes nations
· 9% of global GDP
Up until fairly recently, France was the most popular travel destination with the U.S. in second place.
But in 2016 three major travel destinations were hit with events that adversely affected their travel status. These were: France, Turkey and the U.K. The events in France and Turkey were all terrorist related, but the U.K. had Brexit. All travel to these destinations suffered greatly and travel to Turkey has ground to a halt. This is especially telling now as the third week in January is typically the busiest travel week in the year.
Tauck started the travel industry in this country, but has suffered from prior crises that have affected its ability to do business. The first of these was the great depression of the 30s. Then during WWII the government ordered the industry to shut down for the duration.
Following the war travel blossomed again with the advent of airlines being able to use some former military airports and with the U.S. National Parks becoming popular travel destinations. Tauck expanded its travel capabilities to Europe beginning in 1991, which continued to flourish until 9/11/2001 when the terrorist attack again slowed down tourism. And like before people bounced back from the crisis and began traveling again. Tauck initiated the concept of river boat cruises to further service the European business. Now 85% of Tauck’s business involves international travel.
Tauck’s experience is typical. International travel has grown tremendously and shows no signs of stopping. In the future much of this travel will emanate from China and India.
9/11 was a wake-up call to the industry. Now the industry plans for crises. Each year brings with it a new series of crises and they too are growing in number. The industry has to plan for them as safety is paramount when our customers are considering travel. One example would be our anticipation of a recession in the U.K. following 2017.
Other developments include the forecasts that the U.S. will soon become the number one travel destination and that an increasing amount of travel bookings will occur on-line. We also expect that future travel will focus more on single regions rather than multiple countries. A 4% growth rate is anticipated for the travel industry.
Q. How do you view South American travel?
A. South America is one of the fastest growing areas. It had to wait until the infrastructure was developed to allow for easy intra-country travel.
Q. What are your views on Cuban travel?
A. Cuba is a must destination. Most of the emphasis has been in the western Havana area. But travel to the east. You will see a lot of things the way it was.
Q. Can you use timeshare credits to purchase travel?
A. Not at Tauck. I don’t know much about this type of thing.
Q. What are your views about Iran travel?
A. I would love to go. Tauck doesn’t go there yet. If you go, go with a group and allow 4 months to get your visa.
Q. Why doesn’t Tauck go to Iran?
A. It is like most of the Middle-East. There is a lot to see there, but events have diminished the amount of interest to where it doesn’t pay.
Q. What are your views on trip insurance?
A. More and more travel companies are following the Tauck example and allowing cancellations up until the day of departure for any reason. But I do recommend travel insurance.
Q. Don’t travel groups represent the most efficient time savers?
A. Travel companies can move you around faster than any other way. This is especially important if there is a crisis.