Ireland’s tourism sector is truly reeling from the pandemic. Having lost out on 2020, it is now facing another near wipeout in 2021.
ast year there were those wonderful weeks of taking a short holiday at home in Ireland, which provided genuine financial respite for the hotel industry in certain parts of the country.
The only way that hotels could even attempt to make a profit last year was by availing of all state supports they could, and in many cases, having to hike up prices as they did their best to get the most from a captive holiday-at-home market.
It looks like the same thing will happen again this year with Irish staycationers paying more. This looks like price gouging but is less about profiteering than survival for a lot of hotels. But by 2022 even the most committed domestic tourists will want to take their break abroad.
The real market for tourism is foreign visitors. This week Fáilte Ireland, together with Tourism Ireland, is running its 46th annual flagship trade event. Usually, this involves Irish tourism providers heading to cities like Boston, New York or Berlin, and backed by a government minister, sitting down face to face to sell the Irish holiday experience to travel companies.
As someone who attended these trade events in the past (way back in the mid-1990s when Enda Kenny was Minister for Tourism and Trade), I saw how Irish tourism operators are wonderful at face-to-face selling. A virtual event will be very hard to pull off in the same way – even for them.
A second arm of the approach involved industry operators and journalists from place like the US and Europe, coming to Ireland to “familiarize” themselves with the tourism product. They would be wined and dined in the name of research and the whole thing worked like a dream.
This year not only does the event have to be virtual, but our tourism operators and hoteliers are trying to sell trips for 2022. It is a tall order.
The last time the industry was in deep trouble was after the financial crash of 2008. Big markets for us had been hit by the crash and during the Celtic Tiger years, the industry had become overpriced and complacent.
In 2009 foreign visitor numbers tanked by 900,000 from 7.8 million in 2008 to 6.9 million. The following year they fell again to 6.1 million before beginning to climb back up. It took until 2015 for the previous 2008 high to be breached with 8.6 million foreign visits that year.
It kept on climbing, to 10.9 million in 2018 followed by a slight dip to 10.8 million in 2019, the year before the pandemic hit.
How did the industry recover so well even though it took a few years? Everything was re-priced. Restaurant menus, hotel stays, the lot. Ireland became a better value for money destination than it had been before the crash.
With so many businesses hanging on this time round, it is hard to see how the same will happen post-Covid.
The development of the Wild Atlantic Way was a stroke of marketing genius which helped. The growth and recovery of Dublin after the crash helped drive more international visits, along with the real investment in the overall tourism product.
This time round, we still have the Wild Atlantic Way. Dublin will not recover as quickly as a tourist destination until everything opens up fully and people are comfortable with big cities again.
Pricing and solvency remain real problems. It will be very difficult to offer cut-price anything coming out of this crisis. Many businesses are eating into whatever savings they have.
Hotels along the west coast are gearing up for what they can salvage from a staycation summer whenever it finally gets going. But some are genuinely worried about summer 2022. Will any Irish person take a holiday at home next summer after spending two staycations under duress?
Hence the imperative of getting as many international visitors as possible back for next summer. The infrastructure developed within the tourism industry in recent years has helped drive the sector to record heights. It has extended the holiday season and now caters for different types of visitor. This base should help again, but many businesses could go under before summer 2022.
The way the travel industry operates complicates the recovery further. Ireland will be slow to get back on track due to the likes of mandatory quarantine and a sluggish and muddled vaccination programme. The country may lose out to other markets.
Airline capacity is a key driver of tourism growth. Airlines that shift capacity to other routes will have to be convinced to bring it back on Irish routes again.
The industry and the marketers in Fáilte Ireland will have a real battle on their hands to make the case for holidaying here over somewhere else.
The United States has administered 183m vaccine doses. A sizeable percentage of its population has already been fully vaccinated. Many of those will want to go somewhere this year.
They won’t be coming to Ireland. Even small markets like Iceland are moving quickly. The tiny island nation doesn’t expect to have 75pc of its population vaccinated until July at the earliest.
But they are allowing all international travelers into the country if they have a vaccination certificate. Icelandic tourism operators are taking bookings from Americans for this summer.
The tourism sector is the biggest indigenous employer in the country. It provides vital jobs in parts of Ireland that have not benefitted so much from the foreign direct investment boom.
The government has a job to do. It cannot afford to take its eye off the industry as it didduring the boom. It must continue financial support it can for as long as it can, or we will be years away from achieving anything like the 2019 visitor numbers that provided so many jobs and income.
