How Coronavirus has Affected the Prices of Flights and Hotels

The effect of the coronavirus is one too numerous. It brought about a lot of changes that nobody ever foresees to happen. From the extinction of the daily commuting pattern to transforming one’s relationship with food. Covid-19 is changing the world already, and in some ways, it looks set to get even better.

International lockdown and the effective suspension of social and commercial activity across countries have changed how economic, social, and political systems operate. People get forced to begin a global conversation on how they may need to alter critical structures to make room for this new normal that can barely be changed.

Amongst the sector undergoing a lot of Transformation is the Aviation and hospitality industry. That is because they are among the few of the sectors greatly affected by the pandemic. Individuals’ unwillingness to travel and seek comfort away from their homes makes survival difficult for the industry.

To ascertain safety to commuters, Aviation industries of different parts of the world had to develop different rules and safety guidelines. The strict layout of these rules makes passengers worry about a significant rise in fares. Others have an assurance that fares may remain the same or could probably drop in the coming months.

Amongst the various reasons given for a possible decrease in fares include:

·       Encouraging Travels

Most airline companies are looking beyond the pandemic. The drop in the number of commuters resulting from the pandemic could spell doom for the sector if it continues like this for too long. The low turnout of people going on trips could be disastrous for the Aviation and hospitality industry. To ensure continued patronage, Airline companies get to make price cuts to encourage passengers to journey.

·       Competition

Price remains a significant factor people consider when choosing what airline to fly. That also rarely changes with the coronavirus situation. People visit review websites online, such as Norskeanmeldelser, to compare the various airline charges to decide which airline to fly. The ongoing competition forces airline companies to reduce costs as much as possible to remain competitive.

·       Other Sources Of Revenue

Airline operators do not make their revenue solely from the seat-fares paid by commuters. Commercial airlines stand at a more significant advantage of generating revenue from passengers beyond airfares alone. Airline revenue is made up not of the basic fare but also extra charges. Airlines can charge passengers for baggage fees, seat assignments, and priority boarding privileges. These additional revenue patterns allow them to increase fares as passengers would also have to pay for these additional charges, and an increase may be too difficult to bear.

·       Reduced Operational Cost

While specific overhead costs remain constant irrespective of the number of passengers, other operational costs usually get increased due to increased passengers. The noticeable reduction in the number of commuters, thereby means a reduced operation cost. Costs such as fuel and other operating expenses have fallen due to reduced flight schedules. That means airline companies can retain the current price level without having to run at a loss.

A continuous reduction in flight schedules may subsequently result in increased uncertainty regarding pricing, and fewer flights could eventually result in higher ticket prices. But for airline operations and hoteliers to survive during this pandemic, the determining factors will not be whether they put their fares up, but if they have enough cash in the bank or can powerfully lobby the government for aid to stay afloat. Irrespective of the cost, travelling has a whole lot of other benefits to people. One can visit a website like I Amsterdam to have a glimpse of the wonders of visiting Amsterdam.