The travel industrys recovery since 9/11
has been well documented, but trouble spots remain -- and we dont
mean just the airline industry. We mean the international side of
it all, the inbound market, the part of the travel business that
brought 46 million foreign visitors to the U.S. last year and added
$87 billion in consumer spending to industry coffers.
These are good
numbers and they showed healthy increases in 2004, but they still
lag behind the peak year of 2000 when the U.S. hosted 51 million
foreign visitors, who spent $103 billion. That means we still have
to close a $16 billion gap. U.S. travel companies need that $16
billion. The U.S. economy needs it. The U.S. balance of payments
The weak dollar has
been doing its part to attract foreign visitors, but the image of
the U.S. overseas is still not everything it once was, and U.S.
entry requirements seem to be more daunting than they ever were. In
the global competition for international travel, the U.S. has been
losing market share to more welcoming countries.
The Travel Industry
Association (TIA) has been doing everything it can to spread the
See America message in foreign markets, and the centerpiece of that
effort is about to unfold in New York this week, with the opening
of the 37th annual TIA International Pow Wow.
At this conference
and marketplace, U.S. suppliers from Alamo to Wyndham and U.S.
destinations from the Adirondacks to Wyoming, will set up shop in
1,200 booths to meet with 1,500 tour operators and travel arrangers
from 70 countries. We did the math: The result is a gazillion deals
for bringing group and individual travelers to the U.S. from
U.S.-based travel sellers and suppliers that are principally
focused on U.S. residents, there may be little reason to care much
about TIAs annual Pow Wow. But you neednt be directly involved in
the inbound market to understand and appreciate how the entire
industry benefits when this sector is performing well. We can think
of 16 billion reasons to care.
So even if youre
not at Pow Wow this week, we invite you to join us in wishing TIA
every success in its efforts to invigorate the U.S. inbound
The GDS wars took an interesting turn last
week when G2 SwitchWorks disclosed that a gaggle of airlines had
agreed to prepay the booking fee for several million transactions
to jump-start the fledgling alternative GDS.
We cant remember
the last time an airline willingly paid a GDS booking fee in
advance, which makes this up-front payment from the cash-strapped
airline industry somewhat thought-provoking.
It seems to speak
volumes to G2s credibility, but it may also indicate that G2 needs
the cash more than the airlines do -- or that the airlines merely
want to show the GDSs how much theyd rather switch than
G2 claims to be
cheaper and better, but it probably doesnt have to be. For todays
airlines, cheaper is better.